US allocates $5.4bn to deepen trade ties with four African countries

The United States of America is committing more than $5.4bn through its agencies to develop trade relations with four African countries: Ghana, Ethiopia, Kenya and Côte d’Ivoire.

US Secretary of Commerce, Wilbur Ross, who announced this in Accra on Thursday, said Africa was very important to the global economy and that the USA was taking a whole governmental approach to significantly deepen her commercial engagements with the continent to create new pathways for long-term trade and economic partnerships.

As part of his four-day visit to Ghana, Ross made a speech at the first USA-Ghana business forum at the Accra Marriott Hotel saying; “The agreement demonstrates our commitment to a sustainable high-quality infrastructure development to benefit millions of Africans and create good jobs both in Africa and US.”

The forum was on the theme, “Strengthening U.S.-Ghana Commercial Partnerships towards a Ghana Beyond Aid.”

Members of the US delegation, led by Ross, included leaders of more than 20 major US corporations and leaders of virtually all the government agencies involved in Africa, including the Department of Commerce, the State Department, the Treasury Department, officials from the National Security Council, the USAID, the US Trade and Development Agency and the US Africa Development Foundation.

Those agencies, Ross said, were in the country to demonstrate their support for what was going on in Ghana and in Africa.

He said the trade and investment partnership was an indication of how the US was moving from an aid-based relationship with African countries to long-term trade partnerships.

“Trading and not aid should be our collective mantra. This is already happening in Ghana with the government’s “Ghana beyond aid” campaign and you are bound to attract foreign direct investment,” he added.

Painting a picture of how trade between the US and Africa had declined in recent times, Ross said, “US exports for Africa in 2017 were only $22bn, which was not more than half of what they were in 2014.”

“US imports from Africa also fell around the same period by nearly one-third to $25bn from last year,” he added.

Corruption

On corruption, the US Secretary of Commerce urged African countries to be extremely comfortable with US companies because US companies operating in Africa were required to abide by the US Foreign Corrupt Practices Act prohibiting them from bribing foreign officials or engaging in other corrupt practices to win contracts.

He said he was pleased that Ghana had already taken steps to combat corrupt practices and added that the appointment of the special prosecutor was proof of the government’s determination to clean up the situation.

He pointed out that the office should receive more financial support.

Fiscal discipline

The Vice-President, Dr. Mahamudu Bawumia, who was the special guest of honor, gave an assurance that the government was putting measures in place to ensure that the macro-economic gains that the country had made so far were not reversed.

“I understand that there are concerns in the investor community about fiscal discipline post the conclusion of Ghana’s IMF programme but we are committed to maintaining fiscal discipline for our own sake,” he pointed out.

 Bawumia also outlined some of the structural measures being implemented to tackle some of the long-term structural issues, such as a new fiscal responsibility law which would cap the budget deficit not to exceed five percent for a fiscal year, from 2019, along with limits for the debt to GDP ratio.

“As part of the new law, we will establish an independent fiscal council to oversee the implementation of fiscal policy and also operationalise a Treasury Single Account (TSA) to consolidate all government funds at the Bank of Ghana,” he said.

The vice-president also said the government would also adopt the competitive tender process to eliminate wastage and also prevent corruption.

“As we lay a solid macro-economic foundation for businesses and the private sector to grow, we have not lost sight of key strategic elements that hold the greatest potential to anchor the investments we desire,” he added.