SEATTLE — Africa is the largest untapped consumer base on the planet. U.S. investment in Africa not only strengthens the African economy but is also an investment in future consumer purchasing power of U.S. goods and services. Today, six out of the 13 fastest-growing economies in the world are in Africa. These countries are ripe for U.S. Foreign Direct Investments (FDI).
It is in the U.S. national interest to invest in emerging consumer markets around the world because if it doesn’t, other countries will. From 2000 to 2011 China invested $75 billion in Africa, while U.S. companies have committed a mere $14 billion in future investments on the continent.
Out of the top 15 U.S. trading partners, 11 had been previously given U.S. foreign aid. It’s time to stop seeing foreign aid as a handout; more accurately, it is an investment in the American economy. China and India are excellent examples of countries that have dramatically benefitted from U.S. foreign aid. China has successfully lifted more than 800 million people out of poverty. By liberalizing its market, China has steadily grown its Gross Domestic Product (GDP) by 10 percent a year — the fastest sustained growth in a major economy in history, according to the World Bank.
The great challenge of our time is ending poverty without upsetting the balance of nature. Economic growth needs to be sustainable. In a world of limited resources, our current patterns of unrestrained resource consumption threaten the livelihoods of future generations. We are in the midst of a global shift toward sustainable economic practices. A number of countries are already harnessing the green economy. Goldman Sachs reported that “companies that are leaders in environmental social and government policies (ESG), have 25 percent higher stock values, and 72 percent of ESG companies outperformed their industry peers.”
Where will U.S. investments stimulate the most economic growth in Africa? According to a United Nations Environmental Program (UNEP) report, Africa is a vast, untapped market for renewable energy. Countries like Burkina Faso have already tapped into this market and have increased their energy outputs by 180 percent. The green economy has the potential to create 60 million jobs worldwide and bring clean energy to 1.3 billion people who lack access to electricity.
In America alone, harnessing the green economy by investing in energy efficiency, renewable energy technologies and agricultural sustainability could grow the economy by 158 percent and end the use of coal, oil and natural gas, according to Amory Lovins, founder of the Rocky Mountain Institute.
Investing in the green economy in developing countries is in the interest of the U.S. for several reasons: It furthers its commitment to the U.N. Sustainable Development Goals and will raise GDP and living standards in Lesser Developed Countries (LDCs), increasing their purchasing power of U.S. goods and services, which in turn grows the U.S. economy. Lastly, it is environmentally ethical.
– Josh Ward