The contours of Trump’s Africa policy are emerging, although key appointments, such as the assistant secretary of state for African affairs, have yet to be made.
On February 13, President Trump had telephone conversations with President Muhammadu Buhari of Nigeria and President Jacob Zuma of South Africa—his first with leaders from sub-Saharan Africa. The calls, which appear to have gone well, emphasized Trump’s two core foreign policy priorities: security and commerce.
According to Nigerian officials, Trump commended the government’s progress against Boko Haram, invited Buhari to Washington, and expressed U.S. readiness “to cut a new deal” for arms in the battle against terrorism. The conversation with Zuma reaffirmed “already strong bilateral relations” and noted that there are 600 U.S. companies in South Africa.
At the same time, the Trump administration’s controversial “travel ban” against seven Muslim-majority countries is sending mixed signals about U.S. intentions. The ban includes Somalia—where a naturalized American citizen just won a presidential election running on a strong anti-corruption and anti-terrorism platform—and Sudan—where, just before leaving office, the Obama administration lifted comprehensive economic sanctions in place for 20 years, in part due to increased cooperation on counter-terrorism. There are reports that the White House budget office could eliminate funding for the U.S. Export-Import Bank and the Overseas Private Investment Corporation. These two agencies generate U.S. jobs and profits and provide critical assistance to small, medium and large American companies competing for market-share across the continent.
Africa is on the back burner: The phone calls and other actions notwithstanding, Africa appears to be on the back burner for this administration. At a time when Germany plans to prioritize Africa in chairing the G-20 this year, the U.K. is developing a new trade agenda for the region, and China’s engagement in Africa is unflagging, it is fair to ask what the Trump administration policy might look like.
As Trump works to assemble his Africa team and translate his objectives into a policy toward the region, here are some ideas about advancing core U.S. objectives in Africa:
Infrastructure first: Increasing exports to the continent is one way to spur job creation in the U.S. In 2015, exports to Africa totaled $18 billion. These exports support more than 120,000 American jobs. Giving priority to the development of Africa’s transportation, health, and energy infrastructure could lead to a significant increase in the export of U.S. goods, services, and components. Not only could an “Infrastructure first” initiative enhance important programs such as Power Africa, but it would increase U.S. prestige by responding to Africa’s most immediate needs.
To implement such an initiative, the U.S. should consider creating a U.S. Development Finance Corporation (as outlined by the Center for Global Development), or a Development Finance Bank (recommended by the President’s Global Development Council). The U.S. needs a new instrument that more effectively utilizes and coordinates the resources of agencies such as USAID, the Overseas Private Investment Corporation, the U.S. Export-Import Bank (Ex-Im) and the Millennium Challenge Corporation in support of U.S. companies. An African infrastructure initiative can be structured to benefit economic development across the continent while returning a profit to the U.S. Treasury.
Zero tax: American companies generally perceive the risk of investing in Africa as extremely high. One approach to mitigating risk would be to allow U.S. companies to repatriate profits at a zero tax rate from investments in those countries that are eligible for benefits of the African Growth and Opportunity Act (AGOA). A zero tax on repatriated earnings would lower the risk and increase the returns for American companies investing in Africa. It would also help to make American companies more competitive in a market that increasingly favors companies from the European Union and China.
In fact, as part of his comprehensive tax reform package, Speaker of the House Paul Ryan has proposed the introduction of a “territorial” system of international taxation that would effectively eliminate all taxes on income earned overseas. Given the chances that comprehensive tax reform could be delayed, fast tracking the zero tax as it relates to profits from investments in Africa would ensure that it is implemented as soon as possible.
Executive African Leaders Program: One of the Obama administration’s most innovative programs was the Young African Leaders Initiative (YALI). Over the course of four years, YALI has created a network of more than 350,000 of the continent’s best and brightest, and involved more than 40 U.S. universities and hundreds of partners from the private sector, civic organizations, and state and local governments. Given that 60 percent of Africa’s population is below 35, an extension of YALI’s funding for four years would continue to provide training for Africa’s future leaders while strengthening U.S. ties with the continent.
One improvement on YALI would be to provide executive training to emerging professionals on the continent in areas such as health, education, energy, transportation, logistics, finance, and others central to Africa’s priorities. As part of this executive-level initiative, one major innovation could be the creation of a network for female executives, pairing executive women from the continent with their counterparts in the U.S.
The security dialogue: In his calls with the leaders of Nigeria and South Africa, Trump committed the U.S. to work “for peace and stability” on the African continent. Indeed, this has been an enduring objective of previous administrations.
Elevating the security dialogue with African leaders, especially Africa’s defense ministers, should continue to be a priority for the United States. Already, American officials, business leaders, and civil society representatives have achieved a greater understanding of African markets by meeting annually with African trade ministers and businesses at the AGOA Forum. Participation by Secretary of Defense James Mattis and other senior officials in similar meetings, such as the Tana High-Level Forum on Security in Africa, could help deepen U.S. understanding of security challenges on the continent. The time could be propitious for the creation of an Africa security dialogue like the one that takes place at the Munich Security Conference and the Shangri-La Dialogue in Asia.
The U.S. engagement in Africa is based on a commitment to good governance, accountability, and respect for human rights. Deepening this commitment will be central to the Trump administration’s ability to leave its own positive legacy on the continent, especially as it relates to infrastructure development, trade and investment, and security.