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Africa has key role to play in a prosperous global future
When we look ahead to the challenges and the opportunities the world will face in the coming years, it is clear that Africa has a key role to play in building a more connected, prosperous future for all of us.
Africa is often seen as a place in great need of aid. But while it's true that Africa carries a disproportionate share of the world's poverty and suffers from severe shortages of electricity and modern infrastructure, it is also true that Africa is a source of talent and innovation that can help lead us into a more connected future.
Africa is home to almost 20 percent of the world's population and 60 percent of the world's undeveloped arable land. It is also an early adopter of cutting-edge solutions - from mobile banking to off-grid power - that promise to improve the way we all live and work.
This month, when I make my first official trip to Africa as the president and CEO of the Overseas Private Investment Corporation (OPIC), I will unveil a new OPIC initiative that will lead to a more prosperous continent that is more closely connected to the rest of the world.
Despite all of the progress on the continent, too many barriers to goods and services remain. In 2016, intra-Africa exports made up just 18 percent of total exports compared to 59 percent and 69 for Asia and Europe, respectively. It's estimated that poor infrastructure adds 30 to 40 percent in intra-Africa trade costs.
OPIC's new "Connect Africa" initiative aims to further integrate Sub-Saharan Africa into the global trade market by focusing investment on transportation infrastructure like roads, ports and airports; information and communications technology; and value chains to help ensure more locally produced products can reach global markets.
As the U.S. government's development finance institution, OPIC works to mobilize private investment in emerging markets. We know that investment is critical to creating jobs and long-term economic growth.
Sub-Saharan Africa has been a priority region for OPIC for almost 50 years, and today, more than a quarter of the Agency's $23 billion portfolio is invested there.
Our investments in Africa have helped build power plants, hospitals and water treatment facilities, while providing small businesses and farmers the financial services needed to grow.
We've also seen how investment can forge stronger connections around the continent and the world, from Tanzania, where OPIC supported a logistics business that has made cargo transport more reliable; to Rwanda, where we helped a small business invest in the coffee sector so that rural farmers could reach global markets.
American businesses are eager to invest in Africa, but they often encounter challenges accessing financing or navigating less-developed economies. By helping these businesses invest in places like Ghana, Kenya and Nigeria, OPIC has helped them access some of the world's fastest growing markets.
In recognizing the opportunities to invest in Africa, it is clear that a sense of urgency is needed. Indeed, there is a downside from not actively engaging in Africa. American allies and competitors alike are increasingly investing in the continent, and China's presence is growing dramatically.
As I stated recently in testimony to Congress, a global competition for influence is on and much of the competition centers on Africa.
OPIC's "Connect Africa" investment initiative builds on a number of successful U.S. government initiatives that mobilize private investment to address longstanding challenges.
Through our support of the 5-year-old U.S. "Power Africa" Initiative, OPIC has committed more than $2.4 billion to 20 projects that will expand access to electricity. More recently, OPIC launched the "2X Women's Initiative" to mobilize $1 billion to projects to support the world's women who are such a vital source of stability and economic growth in their communities.
And with Connect Africa, we're looking forward to a future in which all of Africa is contributing its goods and services to the rest of the world, enjoying increased productivity and seeing the rewards. We are all more connected than ever before and OPIC's newly announced initiative seeks to extend that connectivity throughout the African continent.
Ray Washburne is the president and CEO of Overseas Private Investment Corporation appointed by President Donald Trump in August 2017.