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US Investment in Africa Emphasis on Sub-Saharan Africa

US Investment in Africa Emphasis on Sub-Saharan Africa. Anthonie Lombard PhD MBA. All of us share a common vision for the future of Africa. We look to the day when prosperity for Africa is built through trade and markets.

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US Investment in Africa Emphasis on Sub-Saharan Africa

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  1. US Investment in AfricaEmphasis on Sub-Saharan Africa Anthonie Lombard PhD MBA

  2. All of us share a common vision for the future of Africa. We look to the day when prosperity for Africa is built through trade and markets. — President George W. Bush to delegates at the African Growth and Opportunity Forum in Mauritius, January 15, 2003

  3. The African Growth Opportunities ACT (AGOA) • Advantages • Manufacturing in Africa becomes more attractive due to duty benefits; • Sourcing finished products also attractive • Selling to firms producing for the US • More U.S. government support available for investment or exports. • Product Category Examples • Footwear • Machinery • Apparel • Vehicles • Fruits and nuts • Prepared vegetables • Leather products • Cut flowers • Prepared seafood • etc.

  4. Economic Growth Forecasts for Sub Saharan Africa: A Rising Tide? • 4% average growth in GDP between 2000 – 2005, 5.6% by 2006 • 22/48 SSA Countries achieved above 4% growth in GDP 2000-2005 • Real GDP 2-3% above world averages

  5. Economic Growth Forecasts for Sub Saharan Africa: A Base for Growth? • Requires 25% of GDP in Investment vs actuals of 19% • Foreign Direct Investment at 25% in 1970 vs 5% in 2004 • Per capita GDP • $575 2005 • $590 1980

  6. US Trade with Sub Saharan Africa (SSA)

  7. U.S. Investment in Sub-Saharan Africa • At year-end 2006, the stock of U.S. direct investment in sub-Saharan Africa was $14 billion, or less than 1% of the $2,380 billion in total U.S. direct investment abroad. • U.S. capital outflows to Africa (including North Africa) doubled from 2005 to 2006, from about $1 billion to $2 billion, though they are still below the 2003 peak of $2.7 billion. • U.S. investment in Africa is heavily toward natural resources: 47% of total U.S. investment in Africa is in the mining sector (including petroleum)

  8. US Trade and Investment in AfricaA New Dawn? • What should the focus areas be? • What is the role of technology transfer? • What should the role of South Africa be?

  9. ENERGY FACTS • World population without electricity: 1.7 billion • Africa's proportion: one-third • Per capita electricity consumption Africa (2004): 494.9 kWh • Per capita Canada (2004): 15,744 kWh

  10. Global Macro Trend Positioning Energy Supply / Demand Rate of Change Energy $ Volatility Information Technology China Food Safety Sustainability Water Climate Change India Impact Lifecycle

  11. Water Shortage Worldwide Water Stress Indicator • Already about one-third of the world's population lives in countries suffering from moderate-to-high water stress Source: WaterGap 2.0 – December 1999.

  12. Delivering on the Value Promise Through Innovation – A Generic Model Business Units Fuzzy Front End Technology Requisition Value Creation Existing Application 1 Existing Application 2 New Application 1 Value Delivery 15

  13. The Role of South Africa

  14. AGOA and Trade referencehttp://fpc.state.gov/documents/organization/112461.pdf Thank you!

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