WASHINGTON, Aug 3 (Reuters) - Trade barriers, poor infrastructure and corruption are holding back efforts to boost and diversify Africa's trade, U.S. Secretary of State Hillary Clinton said on Tuesday.
Vowing to help Africa overcome poverty, Clinton said the Obama administration's trade and development strategy stressed "fostering regional markets within Africa, boosting trade and aid effectiveness and working with partner governments to promote structural reforms and gradual market liberalization."
She told the annual forum on U.S. trade with Africa that the African Growth and Opportunity Act (AGOA), a pact that allows Sub-Saharan African countries to export over 6,400 types of goods to the U.S. without paying duties, had not delivered the hoped-for trade expansion.
"Petroleum products still account for the vast majority of exports to the United States and we have not seen the diversification or growth of exports that AGOA was supposed to spur," she told African officials and business leaders.
U.S. Trade Representative Ron Kirk said on Monday the AGOA will likely be renewed by U.S. Congress before its 2015 expiration, though is unlikely to be made permanent. African trade groups have said that the program's temporary nature discourages long-term investment in the continent.
Clinton said Sub-Saharan Africa's economy was poised to grow faster than South America, Europe or the United States this year. But she lamented that a region with 12 percent of the world's population produces less than 2 percent of global GDP.
"Many of Africa's major challenges -- from inadequate infrastructure to political instability to corruption -- also present opportunities for market-based solutions, creative partnerships, and responsible government action that could produce a surer foundation for Africa's development," she said.
The subcontinent needed to improve roads, speed up sluggish air travel and update an overstretched electrical grid to support trade and business, added Clinton, who made a major trip to Angola, Kenya, Liberia, Nigeria and other African states in 2009.
Corruption that costs Africa about $150 billion a year "scares away investment, stifles innovation and slows trade," she said.
The top U.S. diplomat also took aim at high tariffs, corrupt border officials and red tape that stifle intra-African trade and slow down regional economic integration.
She held up as an example of positive regionalism the East African Community that incorporates Kenya, Tanzania, Uganda, Rwanda, and Burundi in a market of 127 million people with combined GDP of $73 billion. The grouping had increased trade by 50 percent since forging a common market in 2005 and cutting tariffs and harmonizing business policies.
(Reporting by Paul Eckert; editing by Cynthia Osterman)
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