Teresa Clarke giving a speech on ‘Doing Business in Africa’.
It was an experience that I hadn’t dared imagine for my personal bucket list: an invitation to be the keynote speaker at the White House. Why did the White House invite me to talk about doing business in Africa? Why is the White House focused on an idea that seems incongruous to most Americans: investing in Africa?
The answer is that the United States is well behind Europe, China and India in terms of figuring out just how significant the business opportunities in Africa are. And the Obama administration is intent on closing that gap, and bringing Americans up to speed on what is the next big thing in global economic development. The White House hosted a conference with the Department of Commerce that brought together over 100 senior level investors to discuss our strategies for increasing US investment into Africa. I have been doing business in Africa for 20 years, and I shared my thoughts in a keynote speech entitled, “Ten Things No One Told you about Doing Business in Africa”.
Seven out of ten of the world’s fastest growing economies are in Africa. Yet, most Americans continue to think of Africa as a hopeless continent, a destination for our pity and our charitable contributions. For most emerging economies throughout the world, the United States is the largest investor. The sophistication of American investment funds means that we are often the first country to discover investment opportunities in Asia, Eastern Europe, and Latin America. We are “first movers” when it comes to sniffing out an opportunity to make a buck. That’s the case everywhere, except when it comes to Africa.
Getting rich from African investment has been the source of wealth for innumerable European dynasties. For centuries, Europeans have looked to Africa as a wellspring for income. Countless lives have been sacrificed as Europeans battled indigenous Africans, and other European nations, for the right to control Africa’s rich resources. From the 1400s through the early1900s, almost every European power jumped in the ring in the fight to colonize Africa, including Britain, France, Germany, Belgium, Italy, Portugal, Spain, and Holland. Throughout this period, Europeans profited handsomely from trade in African slaves, oil, diamonds, gold, platinum, iron, cobalt, and uranium, among other high value commodities.
In the last 30 years, China’s investment in Africa has been nothing short of explosive: Chinese trade with Africa grew from $1 billion in 1980 to nearly $200 billion in 2012. China is Africa’s largest trade partner. It is estimated that nearly 800 Chinese companies have investments in Africa. China’s interest in African business is such a high priority that the Chinese government has placed 150, full time, paid commercial attaches in 46 African countries to facilitate Chinese-African business relations. That is a huge statement about how important African business is to China. By comparison, the US has less than 10 employees dedicated to business development in only 4 African countries.
The United States has remained conspicuously absent from doing business in Africa. The “smart money,” sophisticated private investors and blue chip Fortune 500 companies, started seeing the opportunities in Africa over the last three years or so. In 2010, McKinsey & Co., consultants to US big business, published a report called Lions on the Move, which announced, as only a firm with the gravitas of McKinsey can proclaim, that Africa is the next great investment destination. US boardrooms took notice, and as one example, retailing giant Walmart made a $2 billion investment in South Africa last year. IBM, Coca-Cola, Ford, and other major corporations have also increased their stakes in the Africa investment game.
Yet this side of Africa is incongruous with what most Americans think about Africa. Last year, the most viral video in the history of YouTube was a film featuring an African warlord who kidnaps children and turns the boys into child soldiers and girls into sex slaves. The film racked up over 100 million views on YouTube in under one week. Ask average Americans what is the first word that comes to mind when they hear the word “Africa,” and you are likely to get a one sided list that includes poverty, disease, hunger, war, famine and a host of similarly negative terms.
Yes, Africa is a continent with major challenges, but it is also a continent with major opportunities. Africa is not waiting for Americans to come around to seeing those opportunities. Africans are very busy doing deals with Europeans, Asians and even Latin Americans. And while American policy makers are quick to criticize the terms on which the Chinese do business in Africa, if you ask Africans, they are quite satisfied with the terms that they, as independent nations, have negotiated with Chinese investors. Many Africans feel that while Americans are busy debating investment policy, the Chinese are busy actually making investments.
Thinking of Africa as a source of investment riches presents another risk, which is to typecast Africa in another way. A picture of Africa as a land to exploit for our own capitalistic profit is yet another means of objectifying a continent of a billion people, each with their own stories, skills, dreams, talents, achievements, and purpose.
But understanding Africa’s wealth, its human and natural resources, and the stories of how it has evolved to become home to the world’s fastest growing economies is a major step forward in America’s understanding of what has been called the Dark Continent.
Dark is the hue of its inhabitants’ rich complexions, but Africa’s future is especially bright. I was thrilled to be able to share these views at the White House, and I have confidence that Obama’s legacy will include significantly advancing America’s understanding of, and investment in, the African continent.
Editor’s Note: This piece originally appeared in the Huffington Post.