US Investment in Africa Emphasis on Sub-Saharan Africa Anthonie Lombard PhD MBA

All of us share a common vision for the future of Africa. We look to the day when prosperity for Africa is built through trade and markets. — President George W. Bush to delegates at the African Growth and Opportunity Forum in Mauritius, January 15, 2003

Advantages Manufacturing in Africa becomes more attractive due to duty benefits; Sourcing finished products also attractive Selling to firms producing for the US More U.S. government support available for investment or exports. Product Category Examples Footwear Machinery Apparel Vehicles Fruits and nuts Prepared vegetables Leather products Cut flowers Prepared seafood etc. The African Growth Opportunities ACT (AGOA)

Economic Growth Forecasts for Sub Saharan Africa: A Rising Tide? 4% average growth in GDP between 2000 – 2005, 5.6% by /48 SSA Countries achieved above 4% growth in GDP Real GDP 2-3% above world averages

Economic Growth Forecasts for Sub Saharan Africa: A Base for Growth? Requires 25% of GDP in Investment vs actuals of 19% Foreign Direct Investment at 25% in 1970 vs 5% in 2004 Per capita GDP – $ – $

US Trade with Sub Saharan Africa (SSA)

U.S. Investment in Sub-Saharan Africa At year-end 2006, the stock of U.S. direct investment in sub- Saharan Africa was $14 billion, or less than 1% of the $2,380 billion in total U.S. direct investment abroad. U.S. capital outflows to Africa (including North Africa) doubled from 2005 to 2006, from about $1 billion to $2 billion, though they are still below the 2003 peak of $2.7 billion. U.S. investment in Africa is heavily toward natural resources: 47% of total U.S. investment in Africa is in the mining sector (including petroleum)

US Trade and Investment in Africa A New Dawn? What should the focus areas be? What is the role of technology transfer? What should the role of South Africa be?

ENERGY FACTS World population without electricity: 1.7 billion Africa's proportion: one-third Per capita electricity consumption Africa (2004): kWh Per capita Canada (2004): 15,744 kWh

Global Macro Trend Positioning Impact Lifecycle Rate of Change Climate Change India Energy Supply / Demand ChinaFood Safety Water Sustainability Information Technology Energy $ Volatility

Water Shortage Worldwide Water Stress Indicator  Already about one-third of the world's population lives in countries suffering from moderate-to-high water stress Source: WaterGap 2.0 – December 1999.

15 Delivering on the Value Promise Through Innovation – A Generic Model Fuzzy Front End Technology Requisition Existing Application 1 Existing Application 2 New Application 1 Value Creation Business Units Value Delivery

The Role of South Africa

AGOA and Trade reference Thank you!