African Chamber of Commerce of the Pacific Northwest
Thank you, Peter, it is great to be before this group again. I applaud each of you for being here so early to kick off what promises to be a very important and educational day on the topic of commerce and opportunity with Africa. Peter and the African Chamber are to be commended for all that they do to promote and facilitate the growth of trade between here and there.We have in this room several dignitaries from the continent of Africa who I would like to acknowledge.
· Her Excellency Honorable Minister Namayanja Rose Nsereko (Nah-mah-yahn-jah Rose Nee-ser-eko), member of Parliament and Minister from Uganda.
· Ms. Marrian Namayanja (Nah-mah-yahn-jah), President of the Rotary Club of Kipuli, Kampala, Uganda).
· Honorable Cyril Ndaba (Cee-ril nDah-ba), South African Consulate General in Los Angeles.
· Daniels Kazibwe Zziwa (Kah-zeeb-weh Zee-wah), Secretary for Education & Health in Mubende, Uganda.
· James Kiiru (Kee-ru), commercial attaché of the Kenyan Embassy in Washington, DC
Thanks also to the many of you from the U.S. Department of State the U.S. Department of Commerce, the Ex-Im Bank, and the Overseas Private Investment Corporation for making the trip out here from the other Washington for this important event.
Welcome to the great state of Washington. We have a special tie to Uganda and the delegates from there because the city of Mubende is now using an ambulance donated by the Tumwater Fire Department, thanks to extensive coordination by our friends with the Tumwater Mubende Sister City Association.
Last year Eddie Wright with the Poulsbo Fire Department and Targhee Fire Services traveled to Mubende to train 14 local people in the care and maintenance of that ambulance, and the Ugandan delegation met with the Poulsbo Rotary yesterday. This is the kind of benevolent activity that helps us bridge distant continents and builds better understanding between our peoples, so the work by both Hannele Buechner with the Tumwater Mubende Sister City Association and the people of Mubende is truly appreciated.
Our state also was visited by a delegation from Senegal this week. They are specifically interested in Washington technology, products and services for some big airport expansion projects. Senegal is replacing Dakar International Airport with the new International Aeroport Blaise Diagne (blez dee-AHN-yuh), which is projected to open early 2014. This delegation of five toured SeaTac International and Paine Field in Snohomish County to learn some best practices for U.S. airport operations.
Hopefully these delegates had a chance to take in a Seattle Sounders FC game and see the current promotion the Sounders have with Tanzania. In July of this year the Sounders FC partnered with the largest country in East Africa to promote tourism there. So whenever you go to Century Link Field in Seattle or the Starfire Sports Complex in Tukwila will see Destination Tanzania advertisements. The Sounders are also expanding their scouting efforts to Tanzania so hopefully we’ll see some recruits from Africa in Seattle in a future season.
The focus of this 14th African Day Business Forum is of course on Africa as a whole, and more specifically about trade and business opportunities that lie within the plateau continent. For many years Africa was known by the rest of the world as the Dark Continent, due to the Western world’s lack of knowledge about the huge region.
That nickname has since faded because Africa has a great, awakening economy, one that the whole world is watching, especially China. China is very aware of the opportunities in Africa and is investing heavily in certain areas, sometimes sparking controversy.
Here in Washington we have a strong, mutually beneficial relationship with China. China is in fact one of our largest trading partners and I would hope that the nations of Africa are as a whole enjoying the same kind of positive relationship with China as we do here in our state.
Today you will learn much more about current conditions in Africa and some business and investment opportunities and, which, like opportunities in other continents, promise great rewards for those who take part.
I read an article published just last month in the U.K. newspaper The Independent, originally published in longer form in Foreign Policy magazine. It points out, first of all, that the African economy continues to boom and remains the second fastest growing region in the world with an annual growth rate of 5.1 percent over the past decade. Poverty in Africa is down and a new consumer class is swelling in numbers. In fact the article states that these consumers are now directing more than half of their income to things other than food and shelter.
The article also states that by 2035 Africa’s labor force will be bigger than that of any individual country in the world, that African workers today are better educated than ever before and, that with a few reforms, massive job growth is within Africa’s reach.
This is all good news for our region and for other regions that wish to expand trade and business with Africa.
Washington is exporting more to Africa now than ever before. In 2011 exports of merchandise and commodities to Africa reached $2.18 billion, a 32.2% increase over 2010. The five largest export markets in Africa for Washington in 2011 were Ethiopia ($429 million); Egypt ($428M); Algeria ($411 M), Angola ($303 M) and Morocco at $199 M.
Most of this was aircraft ($1.9 billion). But we are told that, based on the most recent economic model, that Washington exports of aircraft to Africa supported 12,300 jobs in our state. That’s quite a few. Egypt was Washington’s 13th largest market for wheat exports in 2011, with sales of $69.1 million. As I mentioned in my remarks last year, we also export a lot of hops to Africa, especially to Nigeria.
What does our state’s biggest airplane manufacturer, the Boeing Company, say about Africa? Well, as it turns out there is much optimism, especially long-term. Boeing states this about Africa on a market assessment web site:
“.. As the second largest and most populous continent after Asia, Africa's long-term economic potential is strong. Over the next two decades, Africa's economy is forecast to grow faster than the world average, driven largely by demand for natural resources, including oil and metals, from both emerging and mature economies. These connections will foster demand for long-haul travel.”
While noting global competition in the aircraft industry, the company forecasts that Africa will require 900 new airplanes valued at $120 billion over the next 20 years.
So aerospace is a natural growth area for Africa, and that spells great news for Washington.
Ethiopian Airlines, by the way, just last month purchased its first 777 Freighter from Boeing and as such became the first African carrier to own one. Ethiopian Airlines was also the first airline in the world outside of Japan to own the 787 Dreamliner. The “Africa First” has been serving destinations within Africa since August. Ethiopian Air is buying 10 of them, and, just last week, it was reported in the media that the Boeing company sent 20,000 pounds of medical equipment from Everett aboard its third 787 Dreamliner to Ethiopia Air at no charge as a part of the company’s humanitarian aid program.
Overall, Boeing has 42 airline customers in Africa. There are more than 475 Boeing aircraft in service and approximately 75 Boeing airplanes on order. Boeing spends $25 million per year with 15 suppliers throughout the continent, including Ethiopia, South Africa and Morocco.
Boeing is partnering with South Africa's 43 Air School in Port Alfred, South Africa to offer a comprehensive pilot training program as part of its efforts to both expand its presence and improve aviation safety.
Perhaps some of you are from the aerospace sector and are already hard at work on opportunities there, or other opportunities in other economic sectors. All it takes really is a strong vision, followed by a solid plan, the right connections and a willingness to take risk.
A committee that I chair, the Legislative Committee on Economic Development and International Relations, recently took a look at the composites industry which is growing rapidly in our state because of its applications for aerospace and other manufactured products. Perhaps someone in this room will have the vision to export Washington-made composite products to Africa and work with Washington companies in doing so.
Many of you are familiar with the work of Thain Boatworks, which, in partnership with Earthwise Ventures, is building a fleet of 10 ferries for Lake Victoria. The first of their 65-foot catamarans was delivered last year and is already in service within the waters of Uganda. The ferry service is doing quite well, we are told. The second boat, which was designed with stronger, lightweight materials and bigger engines, is as we speak bundled up into three large containers and getting ready to ship out this next week.
Thain is building these vessels here at their new, larger facility up in Arlington, which in fact is in part of the old Bayliner Marine boat factory that hadn’t been building boats in over a decade. So not only is their work good for the economy of Africa, but it is also good for our own local economy. The second boat will run internationally, making the 185-mile crossing across the lake between Port Bell, Uganda, and Mwanza, Tanzania, at speeds between 25 and 30 knots. Thain is also building a 26-foot boat in Uganda and training the local work force on boat construction techniques. Thain has already begun work on its third catamaran here as well.
So here is a Washington company that had a vision, found a market and need by re-establishing ferry service on Lake Victoria and employing workers in Washington and Uganda. It’s truly a winning situation for both regions and a great model for others interested in doing business in Africa to follow.
What Thain Boatworks has accomplished started out as a vision by company Founder Bob Smith, a native of South Africa who was raised in Rhodesia and moved to the U.S. when he was just 19. He started out just trying to think about how he could make things better in Africa. That led to many years of helping orphans then he decided to take the broader approach with the ferry fleet, so he lined up a group of investors and made it happen.
There are several other areas where the state of Washington and, with the kind of vision portrayed by Mr. Smith, you all can play a role in being a part of the emerging African economy. When people in our state talk about finding economic opportunities overseas, the first place that comes to mind are often nations within Asia because of our proximity to that continent, but as we see that doesn’t always have to be the case. With a little ingenuity, hard work and luck we can truly establish a strong, vibrant connection to Africa as well. In many respects we are already well on the way.
I mentioned wheat and hops as agricultural products. In past years I’ve talked about possible collaboration between Washington wine producers and African wine making companies in that wine is a rapidly growing industry in Africa, especially South Africa, just as it is in Washington. Washington ships agricultural products all over the world, including Africa.
Our local chocolatiers import cocoa beans from Africa for their fine chocolates. Many of our state’s coffee companies import coffee beans from Africa. For example, Olympia Coffee Roasters in our state’s capital city imports a lot of specialty, fair trade coffee from Africa that is used in some of our finer local coffee shops. Camano Island Coffee Roasters promotes its Ethiopian Supreme and other blends from African beans.
The same report I spoke about earlier points out that Africa can become the world’s breadbasket as the continent has about 60 percent of the world’s unused cropland, putting it on course to create 8 million wage-paying jobs between now and 2020. With all of the agricultural expertise that we have in our state, perhaps there are partnerships that can be created with our producers and new market producers in Africa.
I know that our state’s land grant university, Washington State University, has researchers who are working with international scientists in Africa to find new varieties of beans that will help improve yields on ancient African soils.
A non-profit organization affiliated with WSU called the Ripple Effect is installing simple pumps called treadle pumps to help irrigate arid African lands for crop production. World Vision, which has its U.S.A. headquarters in Federal Way, has number of projects geared toward agricultural sustainability in Africa and is one of many Washington-based organization to do so. So Washington state does have a hand in helping to improve agricultural yields in Africa, which naturally will help strengthen the economy of the continent.
There are many other ways that we in Washington are making a difference in Africa today, and may continue to expand our mutual opportunities there.
Microsoft, for instance, has a huge presence throughout Africa. When Microsoft’s new touch-friendly, Washington state-developed Windows 8 operating system launched here yesterday, it was being launched simultaneously in markets throughout Africa.
Vessel management company Ocean Services in Seattle, a division of Stabbert Maritime, works with several companies in in Nigeria.
American Pulp and Paper Corporation, a global paper company based in Redmond, does a lot of business in Africa as well.
Improving global health is critical from a humanitarian view, but is also big business in Washington because thousands work in this field, with organizations like the Seattle-based Bill and Melinda Gates Foundation and PATH leading the way. Perhaps one day their efforts in sanitation, prevention and treatment of deadly diseases like HIV and malaria, reproductive health services and more will help change the human condition prevalent in many parts of Africa with the results being a healthier population. While the goal is to do good, the business of doing good is also one to be looked at as an opportunity in commerce.
About three years ago my committee took a look at the business of global health. We learned that Washington’s global health sector is responsible for approximately 50,000 primary and secondary high paying jobs and over $1.7 billion in salaries in our state. It also generates $4.1 billion in business activity. The executive members of the Washington Global Health Alliance alone work in nearly 80 countries and have more than 450 national and international partners including governments, pharmaceutical companies, universities, venture funders and foundations.
There is tremendous growth potential opportunity for this economic sector, including investment opportunities for the public and private sectors, new foreign investment, and joint-marketing.
There are also many examples of Washington-based organizations, both for profit and not-for-profit doing just this, taking advantage of new markets created by social entrepreneurship. Whit Alexander, a former Microsoft executive and the creator of that game for the whole family, Cranium, delved into social entrepreneurship by founding an organization called Burro. By setting up a rechargeable battery rental service for irrigation pumps for dry-season vegetable farming in Ghana, Burro helps its customers to save more and earn more so they can do more. This is a simple and very effective service, and just as with Mr. Smith and the Lake Victoria ferries, all it took was the vision by one man to get it done!
As with our visitors from Senegal this week, perhaps Washington engineers and planners can collaborate with their counterparts in Africa on improvements in roads, bridges, airports, railways and other new infrastructures like shopping malls. Again I refer to the Foreign Policy piece, which points out that Nigeria’s four largest cities still only have six shopping malls and that most groceries are still bought in the equivalent of roadside stands.
In short there are no real SuperMalls, SouthCenters or Northgates in Nigeria nor in much of the rest of Africa, with the exception of course of South Africa which has plenty. With the growing consumer class in Africa, helping with the development of larger shopping centers could certainly be something that we look at from here over time.
I haven’t spoken too much about educational opportunities, but we know that with the need for new jobs and new skills to fuel an economically competitive economy, Africa will have to continue to expand its capacity in education. Perhaps there are areas where Washington’s excellent institutions, from community colleges on up, can be a part of the solution. Innovation is key and education is certainly a primary ingredient of innovation, especially in those disciplines that require strong backgrounds in science, technology, engineering and mathematics, which we often hear called STEM.
Over the years I have given various versions of a speech called Where in the World is Washington Going. In that speech I reflect on where we have been as a state and where we must look to stay competitive.
I argue that in order to maintain and grow our economy we need to expand on what we’re doing well and diversify our offerings to the world economy, not get tunnel vision on just one part of the world, and look for new, innovative ways to foster economic opportunity right here at home.
I believe what you are doing today, that is, looking for economic and commercial opportunities in Africa, is very important to the future economy of Washington because it will ultimately mean more jobs both here and there. Just as importantly, it will bring new opportunities for friendship, culture and mutual understanding. Today we are talking about the African economy, but we are also talking about reaching out into the world, building new bridges and making new friends as we go along.
Africa is waking up and in that sense we all need to keep our eyes open too. I wish you a very productive and compelling day. Thank you.