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Opening Up Africa For US Capital

By Russell Mokhiber and Robert Weissman
17 February 1999

With friends like these, Africa certainly doesn't need any enemies.

Africa's "friends" in Congress are preparing to again introduce a "NAFTA-for-Africa" bill. In early February, Representatives Philip Crane, R-Illinois, and Charles Rangel, D-New York, are expected to propose an African free trade bill modeled on the African Growth and Opportunity Act, which passed the House of Representatives in 1998, but stalled in the Senate.

Some of the bill's sponsors are undoubtedly genuine in their desire to afford economic opportunity to Africa. If Mexico has NAFTA, they believe, then Africa should have its own free-trade bill. But providing those kinds of benefits is akin to giving the plague. It's not exactly the kind of gift you want to pass on to a friend.

Other backers of the bill perhaps have different motives. Here's bill sponsor Philip Crane speaking last year to an International Fiscal Association gathering in Chicago, as reported in Congress Daily: "Of those countries in sub-Saharan Africa, to be sure, a lot of them are retards. I I mean they've got a long way to go."

Other supporters of the bill include such suspect friends of Africa as Chevron, Mobil, Exxon, Enron, Caterpillar, Bristol-Myers-Squibb, Bank of America, the Gap, Texaco, Amoco, Citicorp, Kmart and Coca-Cola. These companies are among the members of USAfrica, the corporate lobby for NAFTA for Africa.

It is no accident that oil companies are so prominent among the NAFTA for Africa supporters. The legislation would further open up African countries to exploitation by multinational resource corporations, and prevent countries from taking steps to control the drilling, mining, harvesting and use of resources within their own borders.

The basic structure of the Africa trade bill is to condition existing and potentially some minor new aid and trade benefits on African countries opening their economies to foreign investment and adopting the recessionary "structural adjustment" policies of the International Monetary Fund (IMF). The bill's conditionalities include: compliance with programs of and obligations to the IMF, joining the World Trade Organization, removing restrictions on foreign investment, minimizing government market interventions, and privatizing many government operations.

The bill also instructs the President to develop a plan for a free trade agreement with Africa.

Last year, most African governments were pressured by the Clinton administration into expressing their support for the bill, though privately many African officials are much more critical.

But dozens of African labor, consumer, environmental, development, health and human rights groups were not so intimidated. "We have seen from the ground level the consequences of following IMF policy prescriptions," they said in a statement. "These policies tend to undermine local business, drive up unemployment, damage the environment, harm consumers, undermine public health and increase poverty. We categorically reject any effort to impose such policies on African countries."

The debate this year over the African trade bill will be different than last year in at least one critical respect: This year, a genuine pro-Africa bill will be instilled into the debate.

Representative Jesse Jackson, Jr. -- who last year abandoned his support for the NAFTA for Africa bill after he learned how harmful it would be, and began calling the legislation the Africa Recolonization Act -- is set to introduce the African HOPE (Human Rights, Opportunity, Partnership and Empowerment) Act.

The African HOPE Act will address the absolute priority issue for African development -- debt relief. Huge debt servicing obligations now drain African countries' financial resources and prevent them from investing in basic health care, education or the infrastructure needed as the foundation for a strong economy. The African HOPE Act will lift some of the unbearable burden on African countries by canceling the debt owed by African countries to the U.S. government and taking steps to relieve the debt burden to multilateral lending agencies and private lenders.

The African HOPE Act will also require companies doing business in Africa and wishing to export to the United States to adhere to environmental, worker safety and labor rights standards similar to those required of companies operating in the United States. These companies will also be required to pay a living wage to employees in Africa. The act also will ensure that aid and development money is used for basic social services and strengthening and diversifying Africa's economic production capacity (for instance in the processing of African natural resources and manufacturing). And it will block the U.S. government from challenging African government efforts to provide AIDS drugs and other essential medicines to their people at affordable prices.

The African HOPE Act may not be the approach to satisfy African "friends" like Exxon and Texaco, but it does have the advantage of speaking to the genuine needs of Africa, rather than of the multinational corporations which want to etch in stone their right to exploit African rich resource base.