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Africa: A Continent Faces the Future

Presider: Princeton N. Lyman, Ralphe Bunche Senior Fellow, Council on Foreign Relations
Speaker: Walter H. Kansteiner, Assistant Secretary of State, African Affairs, U.S. State Department
September 15, 2003
Council on Foreign Relations


New York, New York

Princeton Lyman [PL]: My name is Princeton Lyman. I'm the Ralph Bunche Senior Fellow at the Council and Director of African Policy Studies. I want to welcome everyone here for this very fine event. We have a very distinguished group of people. I couldn't start talking about all of the individuals because that would take up all the time set aside for this meeting. Thank you all very much for being here for this very important meeting with Walter Kansteiner, the Assistant Secretary of State for African Affairs. First, keeping with tradition I have to give the rules. We have an unusual set of rules today. Secretary Kansteiner's speech is going to be on the record and his questions and answers are going to be off the record. Please keep that in mind. Second, we are being webcast today with the Council-only webcast, so we have an even larger audience. When we get to the question and answer session please come to the microphone, state your name and affiliation, and ask the question. But we'll get to that.

It is my great pleasure to introduce Secretary Kansteiner. My view, having watched this for some years, is that the position of the Assistant Secretary of State for Africa is probably one of the most difficult positions in the Department of State, and it is because it deals with so many individual countries. We were talking about that earlier, perhaps as close as fifty individual countries, fifty individual heads of state and government and forty four American embassies. No other bureau of the State Department has that degree of scope, and of course given the nature and sweep of Africa, there are almost always five or six significant crises going on, some of great magnitude as in the Democratic Republic of the Congo today, or more recently the coup in Guinea-Bissau. At the same time there are a lot of positive things going on which the Assistant Secretary should give attention to. So it's an enormously difficult job then you add to that the tremendous travel obligations. We're very lucky in the United States to have Walter Kansteiner as Assistant Secretary of State. Walter has been working in Africa for many years. He worked as an Africa specialist in charge of Africa for the National Security Council years ago. He then went into the private sector: he was a founding member of the Scowcroft Group, and I can attest to the fact that he was very instrumental in bringing the largest single private investment to South Africa in the telecom field. He has devoted much of his attention to Africa in all its dimensions, and I find this is very interesting and may explain a lot about what Walter's dedication. Among his many degrees one of which is in ethics from the Virginia Theological Seminary. In spite of the tremendous responsibilities that he carries, Walter somehow retains his youthful looks and exuberance...I don't know how he does it...but maybe it's a reflection of his tremendous dedication. So it's a great pleasure for me and an honor for the Council to introduce to you Walter Kansteiner, Assistant Secretary of State for African Affairs.


Walter Kansteiner [WK]: Thank you very much Princeton. It is truly an honor to be here and I appreciate the Council reaching out yet again to draw Africa and African issues in. Because it's an on-the-record speech and an off-the-record question and answer, Reed Kramer and the other journalists that happen to be here said, "Please, Walter, can you make it a really quick speech so we can get to something interesting because we know you're just going to do the blah, blah, blah and then actually answer some questions off-the-record that might be helpful." (Laughter) But the blah, blah, blah in fact is important because what I'd like to do in these next ten or fifteen minutes is outline some of the goals that we've had in the Bush Administration on Africa, some of the things that we've gotten done and some of the things that we still have left to do. As Princeton said, Africa is very much a moving target with multiple crises at any one time, but also multiple opportunities and we need to strike when the iron is hot.

One of the top priorities that our team at the State Department and the executive branch of this administration has worked on is economic prosperity in Africa, and that's kind of the shorthand for how are we going to get Africa more deeply involved in the twenty-first century global economy, how do we do it to the benefit of Africans and how do we do it to the benefit of investors and traders? The private sector, from which I come to this position, has got to play the major role. Many of you as well are from that sector, and many of you in fact are working, dealing and doing business in Africa and I applaud you and commend you. We look for ways to facilitate that private sector involvement in Africa. We say that the government sets the table and we put out the knives and the forks and the crystal. I'm sorry, the government sets the table and the private sector has to come deliver the meal, so we're looking for ways to set that table. We have done so with the Africa Growth and Opportunity Act (AGOA). The Clinton Administration got us off to a great start on that and we have furthered it and we'd like to see it go even further. Job creation throughout Africa from the AGOA has been extremely good, and quite frankly seven or eight years ago AGOA started getting around the concept of this trade-preferential treatment for African goods. None of us thought it would be as successful as it is today. We're also taking the next step with the Southern African Trade Union with an FTA, a full-blown free trade agreement between the United States and SATU countries. Very exciting, very tough, very time-consuming, but we're working on it and I'm please to say the first three rounds of negotiations have now been completed, and they're going quite well.

We look for ways to increase African governments' capacity to participate in things like capital markets, and I see Jim Harmon here who's led a fantastic commission on capital markets in Africa. A sovereign debt credit rating program has had some real successes, and I'm please to say we now have six new African countries that have a sovereign debt credit rating. When we came in a couple years ago, there were four countries in Africa that had a sovereign debt credit rating…South Africa, Mauritius, Botswana and Senegal…four out of nearly 50. And you are not going to get to play in the capital markets anywhere if you don't have a credit rating. So now we have six that have new credit ratings, we have ten more in the queue, and I think we're on our way to actually seeing Africa fully participate in a key financial market that it has basically been excluded from.

We are looking at programs to integrate equity exchanges…stock exchanges. There are 18 stock markets in Africa…that's the good news. That means there are 18 different places that investors can come and trade equities, can raise capital. The bad news is there are 18 of them, and they're all small and they all have liquidity problems save one or two, and so we're looking at ways we can link some of these equity markets together and in fact look for common listing rules and regimens, and that's going quite well and we're please to see stock markets in Africa actually talking to each other. There are a host of smaller projects that we have we are very pleased with, and then there are the bigger ones, like MCA, the Millennium Challenge Account. We are getting closer to announcing a CEO of that. As soon as we get an appropriations budget I think that will happen and we'll start seeing MCA getting started up and I hope and trust Africa will be a major beneficiary of MCA.

Another key area that we've looked at is democracy and this notion of capacity building, and it's a term we all throw around far too often, I suppose, but institution building and capacity building, helping African governments become more pluralistic, become more transparent. Freedom House lists 19 African countries as what they call electoral democracies, and elections are very important, and we don't want to minimize that one bit, but there are other facets that make a country a democracy: independent judicial systems, the media, and we are trying to always look for ways to build these institutions so in fact these countries' democratic roots can go deeper. The third major area is HIV-AIDS…gotten a lot of publicity as it rightfully should, and this administration had taken some really bold leadership action. There's $15 billion on the table for the next five years for 14 countries that are intensely affected and infected with HIV-AIDS, 12 of which are in sub-Saharan Africa. Our job now is to figure out what's the best implementation of this tremendous resource. How is it going to get rolled out? Is it education? Is it treatment? What are the priorities? And our embassies are becoming the key focal point for the implementation of this project, and I'm tremendously satisfied with that, because I think no one knows the situation better than those that are on the ground, and I'm glad to see our ambassadors, who are very capable people, be able to take the lead and guide and direct these important resources. There are 12 African countries that qualify for this largesse, but then what about the others, because there are more than 12 countries in Africa that have HIV. So we are looking now for ways to fill in and supplement and help with AID and CDC and NIH and all the institutions of our government that in fact deal with the scourge of HIV-AIDS, and I think we will not let those 12 be the only countries that get attention.

A fourth area that we have a high priority on is the environment. It's one I'm personally engaged in and very interested in and people say, "Well, why the environment? Come on, Walter, there are so many other problems in Africa. Why do we care about the environment?" And there are a couple of stock answers, and one is, you know the second largest hard currency earner in Africa is tourism, after oil and gas, it's the largest currency earner, and if you don't preserve the landscapes and the ecosystems of Africa, tourists won't come and look. That's one. Another reason, quite frankly, is perhaps a little more holistic, and that is, many of the problems and conflicts of Africa in fact stem from environmental issues. Slash-and-burn policy…does it have an effect on, say, tribal animosity? It could very well. What's happening on the ground, to the ground, with the air and with the water, in fact does put pressures on both political and economic, and I think we have to look at it.

The final area, and it's probably the area I should have started with, is regional stability or conflict resolution, and I would throw counter-terrorism efforts in this final category. It's the area that if we don't get right, none of the other priorities will flow. If Liberia…and Jacques Klein is sitting here with us today, and he knows better than anyone…if Liberia does not get its security situation resolved, it can't deal with economic prosperity or democratic institution building or even effectively fighting HIV-AIDS. So getting that regional peace, that conflict resolution done has got to be a top priority. And we all know what the crises are: it's Liberia, it's Sudan, it's Congo, it was Angola, and I'm glad to say it no longer is. We have to take these conflicts one by one, and we have to work on them and we have to work on them intensely, and I'd be happy to answer any questions on any of these three, and I would offer up Jacques to answer any on Liberia, too. (Laughter)

Our counter-terrorism program is one that is just getting going. We've had some initial success working with African intelligence services, working with African financial institutions. We're doing a lot on trading of information, and it's truly a two-way flow, and that's a first for the U.S. intelligence community, quite frankly…to be open and honest and actually have a real dialogue with many African intelligence services. It's a good thing and it's a healthy thing and it's brought some excellent results particularly in East Africa. President Bush in fact announced on his trip this summer that there would be a $100 million East African counter-terrorism program. Again, it's now our responsibility to spend that money wisely and devise programs with the Africans to combat terrorism. Another interesting—and I will finish on this and then go to the more interesting Q's and A's—is the notion of military training, African military training. President Bush was struck when he made his visit that African armies do have capacities, they are capable and they are willing as we have seen in Liberia. What they need is some help. We have a program called ACOTA, which is African crisis training group that we're working with, but it's small and it's tough when you can only do two or three or four training programs in an entire year, and I think, I hope, President Bush's vision is much larger than that and in fact grander, and I'm encouraged that some of our colleagues in the Congress feel the same way, that we do need this kind of training because when Liberia happened this summer, it was ECOWAS who came along with the help of the United States, and they are begging for this and I think we need to be responsive to it.

Princeton, I will stop there and be happy to take any Q's and A's. (Applause)

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