“Trade, Not Aid”: America’s Relationships With Africa Matter



Anthony B. Kim, Terry Miller | The Heritage Foundation

“Trade, not aid.”

Two key speakers promoted that slogan at a recent roundtable event hosted by the House Foreign Affairs Committee in honor of Africa Day, commemorating the launch of the Organization of African Unity.

Rep. Karen Bass, California Democrat and chairwoman of the House Foreign Affairs subcommittee on Africa, global health and global human rights, stressed that, moving forward, U.S. policy toward Africa should be more about trade and investment, less about aid.

“We will need to be aligned—like a lot of other countries around the world that view the continent of Africa as a partner—as an investment partner, a business partner, and not view the continent of Africa as a place where we need to deliver charity,” she said.

These words earned a warm endorsement from the next speaker, World Trade Organization Director-General Ngozi Okonjo-Iweala.

“As the DG of WTO,” Ms. Okonjo-Iweala said, “I fully want to support what Rep. Karen Bass said: Trade, not aid, for Africa.”

Ms. Okonjo-Iweala praised Africa’s “entrepreneurial dynamism and connectivity.” She also highlighted the continent’s efforts to grow trade and regional integration, particularly through the African Continental Free Trade Area.

That agreement, now ratified by 36 African countries, went into effect on Jan. 1.

Indeed, it’s time for Washington to pursue a greater economic partnership with Africa.

Currently, the cornerstone of America’s economic engagement with Africa is the 21-year-old African Growth and Opportunity Act (AGOA). A preferential trade program, AGOA offers eligible sub-Saharan African countries duty-free access to the U.S. market for more than 1,800 goods until 2025.

More can and should be done to build on AGOA and upgrade it to strengthen and broaden commercial ties with Africa.

A renewed U.S. effort to promote economic freedom across Africa should also be a central part of America’s long-term mission to assist African countries. Greater economic freedom is the long-term solution to the continent’s weak health security capacities and many more of its economic and social challenges.

Economic freedom is all about empowering people to pursue their dreams by unleashing greater opportunities to earn a living. Preserving and advancing economic freedom ensures real, lasting progress on many fronts.

Over the past 27 years, The Heritage Foundation’s annual Index of Economic Freedom has demonstrated undeniable links between economic freedom, individual liberty, and prosperity in nations around the world.

The facts are indisputable: Free markets and free people have worked hand in hand to increase prosperity and improve the quality of life in terms of health outcomes, environmental protection and much, much more. Perhaps not surprisingly, countries with freer markets also tend to be more resilient in times of crisis and more capable of handling challenging external shocks.

As the 2021 Index emphasizes, Africa can do much more to advance economic freedom and liberate its many entrepreneurs.

While the U.S. cannot provide the leaders of foreign nations the political will needed to transform their economies according to free-market principles, it can support the cause of economic freedom through consistent policy dialogues with its African partners and by providing technical help for reform-minded countries.

The proven right way forward lies in advancing free-market policies that facilitate trade, not aid, which should be the foundation of America’s lasting strategy for practical engagement with Africa.

A good next step toward that strategic objective would be for the Biden administration to resume negotiations aimed at hammering out a free trade agreement with Kenya. As a trading partner, Kenya presents vast opportunities. So far, regrettably, the administration will say only that it is reviewing its position.

Kick-starting negotiations on a U.S.-Kenya free trade agreement would be a powerful signal of American commitment to solidify our pragmatic engagement with Africa. And that could be a major stepping stone toward entering greater partnerships with many more countries on the continent.  

Anthony B. Kim is research manager and editor of the Index of Economic Freedom. Previously, Kim had served as Deputy Chief of Staff to Dr. Edwin J. Feulner, founder of the Heritage Foundation.

Terry Miller champions free markets as director of two of The Heritage Foundation’s key research centers, Data Analysis and Trade and Economics, and as the think tank’s Mark A. Kolokotrones fellow in economic freedom.

To read the full commentary from the Heritage Foundation, please click here.

Image from the Heritage Foundation