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US announces $14 bn in new investments at Africa summit

A sign is seen promoting the US-Africa Leaders Summit is seen July 31, 2014 outside the US Department of State (L) where President Obama will host African Leaders August 4-6,2014 in Washington, DC
A sign promotes the US-Africa Leaders Summit July 31, 2014 outside the US Department of State where President Obama will host African Leaders August 4-6, 2014 in Washington, DC

The United States heralded $14 billion worth of new investments in Africa Tuesday as Washington seeks to demonstrate it is ready to take a strong role in the continent's economic takeoff.

President Barack Obama is to announce the projects later in the day to some 45 African heads of state and government gathered in the US capital for a historic, three-day summit.

The first day of the meeting Monday saw US officials chiding their guests over democratic reform and civil rights.

But now Obama and titans of commerce and industry will try to convince their counterparts that America is as determined to take part in Africa's growth story as China or Europe.

"With a young, dynamic population and a burgeoning private sector, Africa is already a vital market for foreign investors. And that is why we are here today," US Treasury Secretary Jacob Lew told political and business leaders.

"We want to drive more US investment in Africa, increase trade between Africa and the United States, and spur job creation both here and in Africa."

U.S. Secretary of State John Kerry speaks at the Resilience and Food Security in Changing Climate Forum at the National Academy of Sciences as part of the first U.S.-Africa Leaders Summit on August 4, 2014 in Washington, DC
U.S. Secretary of State John Kerry speaks at the Resilience and Food Security in Changing Climate Forum at the National Academy of Sciences as part of the first U.S.-Africa Leaders Summit on August 4, 2014 in Washington, DC

Hundreds of US and African business chiefs are joining political leaders in forums Tuesday, including the top executives of General Electric, Coca-Cola and Walmart, as well as African billionaires such as Nigerian commodities king Aliko Dangote, telecoms tycoon Mo Ibrahim, and Ashish Thakkar, the young founder of the tech-focused Mara Group.

But outside of a few top companies, US businesses faced criticism that they are less knowledgeable and more afraid of risks on the continent than their European and Asian rivals.

The United States remains the largest source of investment but most of that has been in the oil and gas sector.

Meanwhile, China and Europe have built stronger positions in infrastructure, manufacturing and trade, with China's trade with Africa more than double that of the United States.

American companies "are still thinking about Africa as a decade ago... whereas things have really changed dramatically. Africa now has been growing at about 5.5 percent on average in the last decade," said Dangote, Africa's richest man whose fortune is estimated at more than $20 billion.

"There is a lot of perceived risk. People only talk about risk. But the majority of those who perceive risk don't know the story. They have not really been there."

- 'Time to do business is now' -

US Commerce Secretary Penny Pritzker said Washington would boost efforts to build commercial ties, with more government help on financing and more trade missions going both ways.

"The time to do business in Africa is no longer five years away. The time to do business is now."

Pritzker stressed that building trade and investments with Africa would be good for both sides, helping African countries develop and creating jobs in the United States.

"As Africa's middle class continues to expand, we hope to see our export numbers grow," she said.

The summit was partly overshadowed by the rapid spread of the deadly Ebola virus in West Africa, with two infected Americans evacuated to the United States for treatment, and a first case appearing in Saudi Arabia.

As the World Health Organization said the toll had neared 900, the World Bank announced up to $200 million in emergency aid to Guinea, Liberia and Sierra Leone to help contain the outbreak.

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