U.S. transnationals seek greater profits in Africa
The U.S. State Department opened a conference in Libreville, Gabon, on Aug. 24 to promote trade between Wall Street and Africa. It is ostensibly designed to promote the African Growth and Opportunities Act, in place since 2000 to facilitate trade between Africa and U.S. companies. While the U.S. says that AGOA represents the cornerstone of its economic policy in Africa, in reality it is an imperialist tool. Congress recently reauthorized the program.
An Aug. 21 State Department press release read: “The theme of this year’s Forum is ‘AGOA at 15: Charting a Course for a Sustainable U.S.-Africa Trade and Investment Partnership.’” It raises the importance of all sectors in “promoting trade, expanding inclusive and sustainable economic growth, and generating prosperity.” Also, it reported that government officials from the U.S. and the “39 African beneficiary countries” would attend.
Gabon, a former French colony, is an oil producer. The government has maintained friendly relations with Paris and Washington. Imperialist France has increased its military presence in Gabon, where its troops have been activated against mass demonstrations and instability.
U.S. imperialism’s goals
When President Barack Obama recently visited Kenya, he hosted a trade conference there emphasizing African entrepreneurship. He also delivered a speech at the new African Union center in Addis Ababa, Ethiopia. His administration has great concerns about the decline in the value of trade between Africa and the U.S. The decrease in oil and commodities prices exemplifies this phenomenon.
Simultaneously, Wall Street and Washington have emphasized maximizing profits — which come at the expense of working people and their communities.
Critics of the U.S.’s AGOA strategy say it empowers large transnational corporations and further marginalizes local producers and workers. Through AGOA, clothing and other factories have been established in Kenya, Lesotho and other states. These production centers attract rural dwellers to urban areas and working-class jobs. Nonetheless, when demand declines and there are gaps in U.S. funding of AGOA, workers are laid off and forced to return to their villages.
Significantly, Washington utilizes AGOA funding to exercise its policy imperatives in attempts to influence African states’ internal and regional affairs. Consequently, AGOA is a tool to exert U.S. imperialism’s political will.
Washington’s role in Africa has been characterized by its military intervention. The U.S. Africa Command (AFRICOM) stations thousands of troops in Djibouti and maintains other intelligence stations, airstrips and naval operations to protect U.S. corporate interests.
Foreign investment boon to corporations
Although Africa is designated as a rapidly growing region and a center for foreign direct investment (FDI), structural issues emanate from capitalism’s continuing dominance. Most Western investment is designed to enhance the profit margins of the transnational corporations and banks — not to empower the workers, farmers, youth or even local business interests.
Jostein Lohr Hauge, University of Cambridge Ph.D. candidate, wrote on Aug. 20 in African Arguments that Africa is the fastest-growing region for FDI worldwide. “From 1990 to 2013, FDI inflows in Africa increased 19-fold from $3 billion to $57 billion. This trend … is typically seen as a good thing for low-income countries. And especially in Africa, where most countries have small stocks of savings, attracting FDI to grow the economy and create jobs can be crucial.”
However, Hauge concludes, “This trend is all well and good for the huge companies involved — and usually for the economies of the countries in which they are based. But the problem with the expansion of powerful multinationals is that it can allow a small number of actors to capture larger shares of profits over larger markets. They do this so easily … because they have dominant technologies (often fortified by strong intellectual property protection) and brand name recognition.”
China helps Africa build infrastructure
International attention has increasingly focused on the People’s Republic of China’s growing economic and political role with AU member-states. China is the largest trading partner with the continent. Unlike the former colonial rulers, it is emphasizing the construction and maintenance of infrastructure projects related to national affairs, medicine, science and transportation.
A multitude of joint projects between Beijing and AU member-countries include construction of the modern AU conference center in Addis Ababa. China is busily constructing a new railway line covering vast areas across East Africa. It will enhance trade and employment opportunities for people in the region, where the legacy of colonialism and imperialism has hampered the free flow of people and goods.
Agreements to build a new railway line in East Africa with Chinese help were signed in Nairobi, Kenya, reported the BBC on May 12, 2014. “It is to run from Mombasa to Nairobi and will extend to Uganda, Rwanda, Burundi and South Sudan. … In Kenya, the line [will] replace a narrow-gauge track built more than 100 years ago during British colonial rule. China is to finance 90 percent of the first stage, put at $3.8 billion, with work carried out by a Chinese firm.”
Independent economic program needed
A continental strategy independent of imperialism is the only solution to capitalist domination of Africa’s economic development. This can only be carried out when African states place the needs of their people above those of the global corporations and banks.
A prerequisite for genuine independence is the enhancement of industrial, agricultural, educational, medical and scientific capacity in postcolonial African states. Dependence on the West is a byproduct of the legacy of slavery, colonialism and neocolonialism.
Socialist economic construction in Africa poses an alternative to the world capitalist system. In China, where the people gained liberation from imperialism nearly 66 years ago through a profound revolution, tremendous strides have been made through a state-controlled economy. In recent decades China has allowed private capital to operate and grow, but the basic infrastructure and the land are owned and under the control of the government, led by the Communist Party.
Revolutionary Cuba has outstripped U.S. imperialism in providing advanced medical services to its people and millions more in Latin America, the Caribbean and Africa. This accomplishment has been made despite a nearly 55-year blockade and U.S. attempts to overthrow the socialist government.
With considerably more natural resources and agricultural potential, a socialist Africa could become a bulwark for economic growth and set standards forthe rest of the world.