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Obama to announce $14bn in US deals in Africa

ON, Reuters

Posted  Monday, August 4   2014 at  10:39
In Summary
  • The United States will announce nearly $1 billion (about KShs88 billion) in business deals for Africa.
  • An announcement by a large US beverage company is expected to boost purchases from farmers.
  • US officials said the August 4-6 summit in Washington hopes to showcase their interest in the region.

The United States will announce nearly $1 billion (about KShs88 billion) in business deals for Africa during a summit this week, US and development officials say.

It will also increase funding for peacekeeping and commit billions of dollars to expanding food and power programmes in the continent.
US officials said the August 4-6 summit in Washington of nearly 50 African leaders hopes to showcase the country’s interest in the fast-growing region through a series of government-private partnership deals to boost trade and investment.
The spread of the deadly Ebola virus in Liberia, Guinea and Sierra Leone is also a reminder of the vast development needs that persist in some of the region's poorest countries, despite rapid their rapid economic growth and investment.
Administration officials have played down questions over whether the summit is in response to China's growing presence in the region. Instead, they have emphasized that American interests go beyond Africa's oil and minerals, where China is focused.
"You will see a series of announcements on agriculture and food, and power and energy," Rajiv Shah, the administrator of the US Agency for International Development (USAID), told Reuters. "We will make big announcements that demonstrate these are big ambitions we can take on with our African partners and the private sector."
Shah said there will be new support for Power Africa, a privately funded programme launched by President Barack Obama last year to install 10,000 megawatts of new generation capacity and connect 20 million new customers across Africa by 2018.
The programme had already met that goal after just one year, Shah said. "Next week we will announce a more than doubling of our aspirations," he added.
Shah said while companies pledged $7 billion (KShs612bn) to the programme last year, next week "there will be several billions of dollars" in new investments. The World Bank is also expected to make a major contribution toward the programme, according to Bank officials.
The programme is also likely to be expanded from the six nations —Ethiopia, Kenya, Ghana, Liberia, Nigeria and Tanzania — that currently benefit from Power Africa.
There will also be significant increases in private sector support for US-backed food and agricultural programmes in Africa, including the New Alliance for Food Security and Nutrition, development officials said.
The programme was launched in 2012 to bring together African governments, the private sector and donors to boost investment in agricultural production after a massive 2008/09 food price crisis, which sparked unrest in developing nations.
An announcement worth billions of dollars by a large US beverage company is expected to boost purchases from African farmers, according to a company official, who declined to elaborate because details are still being worked on.

Several African officials said General Electric would finalize investments in some African countries during the summit in rail, health and power.

Donald Kaberuka, president of the African Development Bank, said the summit represented a shift in the US-Africa relationship from a focus on aid to investment and trade.
"There are still bits of aid needed here or there but fundamentally the relationship is now defined as one of trade, investment, growth and opportunities," Kaberuka told Reuters in an interview.
"It responds to what Africans are looking for and responds to expectations of American business," he added.
The summit will include a business conference on Tuesday bringing together African leaders and American CEOs. US commerce officials said close to $1 billion in various business deals will be announced, covering different sectors and involving several African countries.
Trade ministers will spend a day discussing ways to improve the US trade programme with Africa, known as the African Growth Opportunity Act, or AGOA, which gives African countries duty-free access to US markets. AGOA expires in September next year and will need congressional approval for renewal.
In other funding increases, the State Department is expected to announce a further $60 million (KShs5.3bn) a year for peacekeeping training in six African countries.

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