Obama Announces Initiatives to Boost Africa Trade, Coca-Cola Follows Suit

President Barack Obama announced $7 billion in new financing resources on Aug. 5 to promote U.S. exports and investment on the African continent through aviation, construction and other projects, as part of an administration-wide effort to bolster trade under the umbrella Doing Business in Africa campaign (here). The $7 billion figure includes $3 billion in Export-Import (Ex-Im) Bank lending over a two year period, along with a host of other financing initiatives from different agencies. The announcement came as the U.S.-Africa Leaders Summit convened for the second day (see 14080501).

Specifically, Ex-Im will commit to financing $563 million to support General Electric locomotive sales to Transnet, a South African freight transportation company, said the White House. The credit agency faces an uncertain future, as Congress continues to battle over reauthorization legislation (see 14080509). The Agriculture Department’s Commodity Credit Corporation will also offer $1 billion in financing guarantees for U.S. exports to Africa, the White House added.

Meanwhile, Coca-Cola, along with African bottling partners, pledged $5 billion on Aug. 5 in new investment to be made over the next six years (here). The company said the pledge will bring its total African investment figure to $17 billion between 2010 to 2020. "We can do more to source agricultural ingredients locally, with significant supply potential that’s underdeveloped and underutilised," said Coca-Cola Chairman Muhtar Kent. "Tapping this potential could accelerate the growth of our business and Africa’s emerging economies, making our supply chains more cost effective and enabling sub-Saharan Africa to supply more ingredients to growing markets in Africa and beyond.”

Obama also issued an executive order on Aug. 5 to mandate that the Secretary of Commerce establish an Advisory Council (here) on Doing Business in Africa within 180 days. The council will comprise industry representatives from the agriculture, consumer goods and other sectors, and is designed to advise the president on ways to increase U.S. private sector investment in Africa, including in infrastructure development, foster growth in African agriculture and increase financing for U.S.-African trade, among other recommendations. Obama authorized the council for two years, after which it will terminate unless the president extends its charter.

Among other programs and projects spanning across the administration, the Office of the U.S. Trade Representative (USTR) signed on Aug. 5 a Trade and Investment Framework Agreement with the Economic Community of West African States (ECOWAS), as part of the Doing Business in Africa campaign (here). While declining to elaborate on the specifics of the agreement, USTR touted bilateral US-ECOWAS trade that reached $23.3 billion in 2013. Aside from energy products, leading ECOWAS exports to the U.S. market in 2013 also included cocoa and cocoa preparations, rubber and rubber products, aluminum and titanium ores, and edible fruits and nuts, said USTR.