Walter Kansteiner, the US assistant secretary of state for Africa, said this week that the US will reinforce Africa's financial infrastructure through the Millennium Challenge Corporation, an initiative launched last month by the Bush administration to boost private sector investment in developing countries.
The corporation's remit will be to support capital market development and integration, loan guarantees and credit ratings. It will also assist portfolio investment from the US and help medium-sized and large corporations operating in Africa to raise debt.
"What we are fighting for is Africa and to reward the good performers," said Kansteiner. "The private sector will get Africa up and going. It won't be just official development assistance. Governments must work together to set the table, but the private sector will deliver the meal."
Some critics argue that the Corporation cuts across the New Partnership for Africa's Development (Nepad). Nepad is a plan forged by African leaders to promote good governance among themselves, in return for higher investment and development assistance. Its emphasis has been on African countries judging their peers rather than conforming to standards set by the west. However, US officials say the work of the Corporation will complement Nepad and the $10 billion the US already hands out annually in development aid.
"Rewarding the good performers makes sense. That's the Nepad theology. We truly do believe Nepad is what is going to make Africa work. But we are going to pull together the criteria we think are important," Kansteiner said.
President George W. Bush is expected to champion private sector investment in Africa during a four-country visit there in January. He is also expected to promote the US steps taken to give African countries improved access to its market through the African Growth and Opportunities Act.
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