Critical international commentary丨Understanding the reality of U.S. investment and aid to Africa

The White House recently announced that President Biden has postponed his planned visit to Germany and Angola in mid-October due to the need to respond to Hurricane Idalia. Biden’s visit to Angola is particularly noteworthy, as it is part of a commitment he made over a year ago to engage more deeply with Africa, a promise that has yet to materialize for various reasons. With less than three months left in his term and the U.S. elections heating up, the viability of his African trip hangs in the balance.

This situation raises questions about the United States’ commitments to Africa, many of which have fallen short of their promises. As major power rivalries intensify and the global landscape evolves, what is the true intent behind America’s overtures to Africa? How realistically can U.S. pledges of support for African development be fulfilled? It’s worth examining both past and present contexts to gain insight.

Consider the somewhat disingenuous African Growth and Opportunity Act (AGOA). For over half a century, the U.S. approach to Africa has fluctuated between attention, neglect, and renewed focus. During the Cold War, the U.S. ramped up economic aid to Africa to counter Soviet influence. However, following the Soviet collapse and emerging issues within African nations, the continent’s importance in the eyes of Washington diminished. It wasn’t until the Clinton administration, recognizing Africa’s growing political and economic significance, that the U.S. began to rethink and reassert its relationship with the continent, branding it as a “new partnership.” Multiple U.S. administrations since then have introduced various policies aimed at enhancing cooperation with Africa.

AGOA, signed into law by President Clinton in May 2000, is perhaps the most prominent example of this effort. The act expanded market access for African goods, increasing the number of products eligible for duty-free entry into the U.S. from 1,800 to 6,000 and lowering tariffs on imports of textiles, minerals, and agricultural products from Africa. However, this “generosity” has largely benefited U.S. interests more than those of African nations.

For one, the benefits of AGOA are concentrated in a few industries and countries. In 2021, out of 39 beneficiary countries, about 80% of tax-exempt products came from just five countries: South Africa, Kenya, Lesotho, Madagascar, and Ethiopia. Furthermore, many African nations saw minimal advantages from AGOA, which has been criticized for lacking effectiveness in promoting industrialization across the continent.

Moreover, AGOA’s trade arrangements primarily facilitate U.S. imports of oil, gas, and crucial mineral resources from Africa, enriching American businesses while putting African nations at a disadvantage due to the political conditions attached to their participation. Countries seeking to benefit from AGOA must meet stringent U.S. standards related to market economics, rule of law, and human rights, which have often been used as leverage against Africa.

For instance, in 2015, when Kenya, Rwanda, Uganda, and Tanzania attempted to impose tariffs on American second-hand clothes, the U.S. threatened to strip these nations of AGOA benefits, forcing them to back down. In January 2022, Ethiopia was removed from AGOA, devastating its textile industry and leading to massive unemployment. Most recently, in October 2023, the U.S. cited alleged violations of democracy and human rights to exclude Niger, Gabon, Uganda, and the Central African Republic from AGOA eligibility.

Next, let’s discuss the mysterious “Lobito Corridor,” which has recently garnered attention from U.S. politicians seeking to highlight investment in Africa. This corridor lies within Angola, the very country Biden planned to visit.

Angola, a major oil producer with rich mineral resources, was the site of the Lobito Corridor proposal first introduced by the U.S. and its allies at the G7 summit in May 2023. The plan entails revamping a railway network connecting Angola, the Democratic Republic of the Congo, and Zambia. While repaving and upgrading infrastructure is undoubtedly beneficial for African communities, many analysts, including Li Wentao, a scholar at the Chinese Academy of Modern International Relations, argue that the U.S. is misrepresenting its role in this initiative.

In reality, the Lobito Corridor is not a fresh concept. The main railway lines were constructed by Portuguese colonizers in the early 20th century and have been out of commission due to significant damage from Angola’s civil war. From 2006 to 2014, Chinese firms undertook massive reconstruction efforts on the Benguela Railway, with investments amounting to approximately $1.83 billion. In February 2015, the railway fully reopened—practically mirroring what the U.S. is now branding as the Lobito Corridor.

So why is the U.S. suddenly so focused on this project? The corridor runs through one of Africa’s richest regions for cobalt and copper, and publications like “Foreign Affairs” have suggested that the U.S. is eager to tap into these lucrative mineral sectors.

Despite this, analysts point out that the promised developments remain just that—promises. Cameron Hudson, an analyst at the Center for Strategic and International Studies, notes that, while Washington is eager to promote this investment, no actual railway construction has yet taken place. Furthermore, the minimal funding pledges made by the U.S. will primarily originate from government sources or international agencies, while private capital remains hesitant to invest, leading to potential funding deficiencies in this ambitious project.

Reflecting on the past few years, it’s notable that both the Democratic Republic of the Congo and Zambia have signed memoranda of understanding with the U.S. and EU to create economic zones for mineral processing, yet no tangible progress has been made on these agreements. As the “Harvard International Review” succinctly stated, “If goodwill never moves beyond the stage of memoranda, they are as valuable as ‘toilet paper.’”

Moreover, while the U.S. prides itself on being the largest donor of foreign aid globally, much of its assistance to Africa has been mired in controversy. At the December 2022 U.S.-Africa Summit, the Biden administration pledged $55 billion to support the African Union’s Agenda 2063. In August this year, they announced an additional $536 million in humanitarian aid to sub-Saharan Africa, bringing their total humanitarian aid projections for FY 2024 to nearly $3.7 billion.

However, these figures can be misleading. Critics argue that a significant portion of U.S. aid is absorbed into administrative overheads and costs related to the organizations that handle these initiatives. Numerous experts frequently visit African nations under the guise of providing assistance, incurring substantial travel costs funded through these aid programs. Even activities organized by American foundations in Africa are included in these aid totals.

In some instances, U.S. aid can manifest more ominously. Li Wentao contends that much of America’s “soft assistance”—which includes funding diverse training programs, seminars, and NGOs—has been used to support anti-government movements. This undermines stability and disrupts domestic order in several African countries. Former U.S. Defense Secretary James Mattis has stated, “U.S. foreign aid is not charity; it’s strategic investment for our own security.”

Finally, while the U.S. has proposed a range of grand and ambitious initiatives aimed at Africa, critics see them as lacking substance. For example, in the 2022 U.S.-Africa summit, the $55 billion pledge included only $15 billion for new projects, with the remaining $40 billion merely repackaging previous U.S. commitments. Analysts like Ankur Gupta from Eurasia Group have stated that this lack of genuine innovation and sincerity in American aid leaves much to be desired.

In conclusion, whether framed as significant aid or impressive investments, much of what the U.S. does in Africa serves its own interests. Behind the facade of “investment” and “aid,” there lies a pursuit of dominance and control, which may ultimately sever the goodwill of African nations.