---------- Forwarded message ----------
Date: Mon, 29 Oct 2001 10:31:07 -0500
From: Africa Action <[log in to unmask]>
To: [log in to unmask]
Subject: USA/Africa: Economic Policy, 2
USA/Africa: Economic Policy, 2
Date distributed (ymd): 011029
APIC Document
Africa Policy Electronic Distribution List: an information
service provided by AFRICA ACTION (incorporating the Africa
Policy Information Center, The Africa Fund, and the American
Committee on Africa). Find more information for action for
Africa at http://www.africapolicy.org
+++++++++++++++++++++Document Profile+++++++++++++++++++++
Region: Continent-Wide
Issue Areas: +economy/development+ +US policy focus+
SUMMARY CONTENTS:
A statement (distributed in a separate posting) was released today
by Africa Action,Oxfam America, and ActionAidUSA, at a briefing for
the international and White House press corps on the occasion of
the first U.S.-Sub-Saharan Africa Trade and Economic Cooperation
Forum. The statement highlights four broad policy changes needed
for U.S. policy on economic relations with Africa, in the areas of
debt, international trade negotiations, development assistance, and
U.S./African trade in particular. The groups argue that the
present approach, focused on the African Growth and Opportunity Act
(AGOA), is too narrowly limited to trade and unhelpful to promotion
of sustainable development of African countries.
This posting contains selected web links for more information on
the issues discussed in the statement, as well as excerpts from a
March 2001 U.S.-African Trade Profile with statistics on U.S. trade
with sub-Saharan Africa. Despite AGOA, the data make clear, U.S.
imports from Africa are still highly concentrated on a narrow range
of products (oil and strategic minerals) and a small number of
countries.
+++++++++++++++++end profile++++++++++++++++++++++++++++++
Selected Web Links for Background Information on
issues raised in October 29 statement by Africa Action,
Oxfam America, and ActionAidUSA
Note: This is not intended to be a comprehensive list, but a short
list of what we recommend as good starting points for particular
topics.
Debt Cancellation
http://www.africapolicy.org/action/debt.htm
Includes links to other sources, as well as to documents
distributed on the topic through the Africa Policy Electronic
Distribution List. Also the June 2001 Africa Action position paper
on Africa's Debt.
International Trade Negotiations
http://www.twnside.org.sg
The Third World Network website has the most comprehensive and
recent information available on the positions presented by African
and other developing countries in World Trade Organization
negotiations.
http://www.ictsd.org/weekly
BRIDGES Weekly Trade News Digest, from the Internatonal Centre for
Sustainable Trade and Development, has regular summaries of the
state of trade negotiations.
http://www.africapolicy.org/action/access.htm
Includes links to other sources, as well as to documents
distributed on the topic through the Africa Policy Electronic
Distribution List.
Official Development Assistance
http://www.africapolicy.org/docs01/ldc0105.htm
Includes several recent documents from the May 2001 Brussels
conference on Least Developed Countries, and other references.
http://www1.oecd.org/media/release/ODA_april01.pdf
Latest official statistics from the Development Assistance
Committee of the OECD
http://www.devinit.org/realityofaid
Reports from the Reality of Aid project, with critical reviews from
Northern and Southern non-governmental organizations.
http://www.usaid.gov/regions/afr/
The Africa page of the official site of the U.S. Agency for
International Development.
U.S./Africa Trade Information
http://www.agoa.gov
Site dedicated to the African Growth and Opportunity Act. Has
detailed information useful to businesses, as well as links to
statistics and reports from the US Trade Representative's office
and other agencies. In addition to the profile excerpted below, the
latest trade statistics (through June 2001) are available at:
http://www.agoa.gov/Resources/0601trst.pdf
http://www.africacncl.org
The Corporate Council on Africa, which is hosting a U.S-Africa
Business Summit in Philadephia on October 30 - November 2.
http://reportweb.usitc.gov/africa
Links to most recent statistics, including query for detailed
country-level information.
**************************************************************
U.S.-AFRICAN TRADE PROFILE
Prepared by: G. Feldman U.S. Department of Commerce,
International Trade Administration, Office of Africa
March 2001
[brief excerpts only; for full text see
http://www.agoa.gov/Resources/TRDPROFL.01.pdf]
Two-way trade between the United States and Sub- Saharan Africa
recovered strongly in 2000 from a lackluster performance in 1999,
propelled by surging prices for imported crude oil and modest
increases in U.S. exports to South Africa and Nigeria. Total trade
(imports plus exports) soared 50%, to $29.4 billion.
* U.S. exports to Africa grew 6.4% to $5.9 billion, although sales
did not recover all the ground lost in 1999 from the record 1998
total. The increase was led by sales of aircraft to South Africa
and Kenya, and oil field equipment to Nigeria.
* U.S. imports from Africa surged by two-thirds to nearly $23.5
billion, due to soaring prices for crude oil.
Total trade had decreased narrowly in 1999, as a dramatic fall in
U.S. exports was offset by higher U.S. imports caused by rising oil
prices. Average crude prices began to climb in March 1999, and
escalated nearly 150% by year-end 2000.
The U.S. merchandise trade deficit with Sub-Saharan Africa doubled
in 2000, to $17.6 billion.
The cumulative imbalance over the last five years is nearly $52
billion in Africa's favor, but the associated transfer of financial
resources benefits only a handful of African countries which supply
substantial amounts of crude oil or strategic minerals to the
United States.
* Nigeria, Angola, Gabon, and South Africa accounted for nearly 94%
of the U.S. trade deficit with Sub-Saharan Africa in 2000. The
first three were major oil suppliers, while South Africa provided
platinum and diamonds.
* As trade increases between Africa and the United States it also
grows more concentrated, with a small number of African countries
accounting for a greater share of the total for both imports and
exports.
Africa's Global Trade. Sub-Saharan Africa's total imports declined
7.5% in 1999 (the latest year available), to $77.2 billion from
$83.5 billion in 1998. The contraction was due in large measure to
the delayed impact of the financial crisis which gripped Asia and
other emerging markets in 1997-98. The crisis exerted downward
pressure on Africa's terms of trade, as world prices fell for most
of Africa's export commodities.
Sub-Saharan Africa's share of world trade continues to decline,
increasing Africa's marginalization from the global economy and
excluding the region from growing world prosperity. In the last two
decades, the volume of world trade has tripled while Sub-Saharan
Africa's trade has grown less than 10%. As a result, Africa's share
of global trade has fallen from just under 4% to less than 1.5%.
The U.S. share of Africa's total import market was 7.3% in 1999,
down from 8% in 1998 due to appreciation of the dollar on foreign
exchange markets. The dollar appreciated nearly 5% against the euro
in 1999, while the United States slipped from second place to third
among Africa's industrial country suppliers behind France with a
9.7% share and Germany with 7.6%. EU suppliers combined enjoyed a
38.6% market share in 1999, virtually unchanged from 39% in 1998.
The dollar appreciated still faster in 2000, gaining a further 20%
in value against the euro. The trend could have negative
implications for U.S.-African trade in years to come.
Sub-Saharan Africa accounts for less than 1% of U.S. merchandise
exports, and less than 2% of U.S. merchandise imports. In
comparison, the region accounts for 3.6% of global exports and 3.7%
of total imports for the European Union (EU). However, the United
States is Africa's largest single market, purchasing 19% of the
region's exports in 1999. The United Kingdom was second at 6.8%,
and France third at 6.4%. The EU combined absorbed 40% of Sub-
Saharan Africa's exports.
Impact of Asia Crisis. The Asian financial crisis was slower to
affect Africa than most other regions, due to the undeveloped state
of most African financial markets. However, the crisis eventually
took a major toll on Africa's terms of trade due to lower demand in
Asia for Africa's principal exports. Crude oil, gold, and copper
were particularly hard hit, and only oil has recovered.
* Average world crude oil prices fell from $23 to under $10 per
barrel between 1997 and 1999, then climbed to nearly $34 during
late 2000 before a small decline.
* Meanwhile, gold prices which fell 24% after the onset of the Asia
crisis in 1997, have continued to slide. In 2000 they averaged 27%
below their pre-crisis levels, partly in response to large sales by
the U.K. and Swiss national banks.
* World copper prices were approximately 38% lower in 2000 than in
1995, although declining stockpiles caused a mild uptrend in prices
near the end of the year.
* According to IMF data, in late 2000 the metals commodity index
was nearly 17% below the 1995 level, and the index for agricultural
raw materials was down 28%.
* The World Bank anticipates a decline in crude oil prices in 2000-
2001, and modest increases in prices for metals and agricultural
raw materials. However, African exporters of coffee, tea, and cocoa
would still face prices well below the levels of the pre- Asia
crisis. ...
U.S. Merchandise Exports in 2000
U.S. merchandise exports to Sub- Saharan Africa were $5.9 billion
in 2000, a 6.4% increase from the 1999 total. The expansion was led
by sales of oil and gas field equipment to Nigeria, and aircraft to
South Africa and Kenya. Exports had contracted sharply in 1999, due
to dramatic declines in sales to the three largest U.S. markets in
the region: South Africa, Nigeria, and Angola.
* Sales of aircraft and oil field equipment tend to be volatile,
suggesting that export growth may not be sustainable in the longer
term.
* In 1998, exports of aircraft and parts to South Africa and oil
field equipment to Angola pushed U.S. exports to their highest
total ever. A dramatic decline in these items in 1999 caused a
large fall in total U.S. sales.
The 6.4% increase in 2000 shipments to Sub- Saharan Africa lagged
behind gains in most other regions, with the exception of Eastern
Europe where exports were flat and the Middle East which fell 9%.
U.S. exports increased 21% in East Asia, 9.7% in the former Soviet
republics, 7.4% in Central and South America, and 12.6% worldwide.
Despite the relatively slow growth, U.S. exports to Sub-Saharan
Africa were 78% greater than those to the Newly Independent States
of the former Soviet Union, and 86% greater than to Eastern Europe.
U.S. exports to South Africa alone were a third greater than our
sales to Russia, whose population is more than 3.5 times as large.
As U.S. exports to Sub-Saharan Africa grow, they become
increasingly concentrated among a small number of countries. The
top four markets--South Africa, Nigeria, Kenya, and Angola-
accounted for 72% of U.S. sales in 2000, with South Africa
accounting for 52%, Nigeria for 12%, Kenya for 4%, and Angola for
3.8%. In 1999, the top four markets represented less than two-
thirds of total exports. ...
U.S. Merchandise Imports in 2000
U.S. purchases from Sub- Saharan Africa totaled $23.5 billion in
2000, a 67% increase from the 1999 total, due to sharply higher
prices for crude oil and a 40% increase in imports of platinum
group metals.
Crude oil accounted for $16.3 billion, or 69% of U.S. imports from
the region. In 1999, U.S. imports of crude oil from Sub- Saharan
Africa were $8.1 billion, or 58% of total imports.
* Although crude oil imports from Sub-Saharan Africa doubled in
value terms in 2000, the increase in total barrel volume was only
16%. The average price per barrel escalated more than 73% during
the year, to $28.79.
* Sub-Saharan Africa supplied 18% of U.S. crude oil imports by
value in 2000, up from 16% in 1999. In comparison, Persian Gulf
suppliers provided 25% of U.S. imports, unchanged from 1999.
* Nigeria, the number five U.S. supplier, provided $10 billion of
crude oil to the United States, 11% of total imports. Angola was
the eighth leading supplier, at $3.4 billion. Gabon ($2.1
billion), Congo-Brazzaville ($ 348 million), Congo-Kinshasa ($168
million), and Equatorial Guinea ($107 million) also ranked
among the United States' top 25 suppliers of crude oil.
The second leading U.S. import, platinum group metals, constituted
6.5% of purchases. This category also includes iridium, palladium,
and rhodium, among others. Partially refined petroleum products
represented 4.1% of U.S. imports from the region.
After crude oil, platinum, and diamonds, imports of woven and knit
apparel experienced the strongest expansion in 2000, growing 28%.
The upsurge came before the apparel provisions of the African
Growth and Opportunity Act (AGOA) were in force. Enacted in May
2000, AGOA provides for duty-free and quota-free importation to the
United States of finished apparel from eligible African countries
when they have met certain stipulated requirements. As more
countries meet the requirements, the apparel sector could become an
export growth engine in Africa.
U.S. imports from Africa remained highly concentrated among a small
number of suppliers, even more so than U.S. exports. Four
countries-- Nigeria, South Africa, Angola, and Gabon- accounted for
more than 87% of U.S. purchases. Three were major crude oil
suppliers, while South Africa was an important supplier of
platinum, diamonds, and steel.
EU imports from Sub-Saharan Africa were only slightly more
diversified. The six leading suppliers-- South Africa, Nigeria,
Cote d'Ivoire, Cameroon, Angola, and Ghana-- accounted for 70% of
EU imports from the region, with crude oil constituting nearly 19%
of the total, diamonds 11%, and gold 6%.
Generalized System of Preferences. Duty-free importation of goods
from Africa under the U.S. Generalized System of Preferences (GSP)
jumped 54% in 2000, to $2.4 billion. However, the increase does not
represent wider GSP utilization by African countries. Instead, the
increase was dominated by oil shipments from Angola, Congo-
Kinshasa, and Equatorial Guinea.
* Angola moved to third place among GSP beneficiary countries
worldwide from fifth place in 1999. South Africa was the eighth
leading beneficiary due to a 30% jump in shipments of ferro-
chromium. For the second straight year, these two countries
accounted for 80% of total GSP benefits in the Sub-Saharan region.
Five countries accounted for more than 94% of GSP utilization in
Africa.
* Angola, Congo-Kinshasa, and Equatorial Guinea benefitted from a
measure first implemented in 1997 that made imports of crude oil
and partially refined oil products from least developed beneficiary
countries GSP-eligible.
* Leading GSP items from Africa in 1998 were: crude oil, partially
refined petroleum products, ferro-chromium, and cane sugar.
************************************************************
This material is distributed by Africa Action (incorporating the
Africa Policy Information Center, The Africa Fund, and the
American Committee on Africa). Africa Action's information
services provide accessible information and analysis in order to
promote U.S. and international policies toward Africa that advance
economic, political and social justice and the full spectrum of
human rights.
Documents previously distributed, as well as a wide range of
additional information, are also available on the Web at:
http://www.africapolicy.org
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