Catfish farm in Ivory Coast - one nibble in US-African trade
Abidjan, Ivory Coast
Whiskered channel catfish flown over from Mississippi will soon become part of the daily diet of the people of the Ivory Coast. Ivoirians are voracious fish eaters. But despite a long Atlantic coastline, the country imported 153,000 tons of fish, representing 56 percent of consumption, in 1985. US-based Aquaculture Technologies Ltd. is launching the country's first industrial fish farm project. It will produce 22,000 tons of catfish - or 8 percent of the country's needs.
Throughout West Africa, foreign businessmen are taking a second look at economic prospects - and are encouraged by more liberal trade and investment policies. An African tour by Secretary of State George Shultz last January briefly brought the region into the American spotlight.
Shultz visited four West African countries - Ivory Coast, Nigeria, Liberia, and Senegal - during his six-nation African tour. This was followed by increased US diplomatic efforts to promote US business with West Africa as part of the policy of development through the private sector.
American agricultural technology, for instance, was on display in early May at a three-day trade fair in Abidjan - the first US trade fair in sub-Saharan Africa.
``American farm technology could assist the government as it switches from extensive to intensive farming and diversifies crops,'' says Dennis Kux, US ambassador to the Ivory Coast.
The decline of the US dollar has made US suppliers of agricultural equipment and machinery more price competitive, he added.
The $2.5 billion-a-year Ivoirian market has traditionally been dominated by France. But European and US exporters have since independence steadily eroded the French market share from over 60 percent to 32 percent. The US is now the second major supplier, providing about $100 million a year of petroleum and food products, equipment and machinery.
About 60 US firms are based in Abidjan with investments of some $1 billion, mainly in petroleum, manufacturing, and in financial services.
Some US companies, such as Eveready Batteries (a division of Ralston Purina), use Abidjan as a base for exporting to the 40 million consumers of the six nations in the French West African Economic Community.
Exports have been restricted, however, by import licenses introduced to protect local battery manufacturers, notes Tom McCubbin, Eveready's Ivory Coast managing director. In Anglophone countries with non-convertible currencies, problems arise trying to confirm letters of credit.
Douglas Leavens, vice-president of Chase Manhattan Abidjan, adds that improved and more flexible credit facilities offered by the US Export-Import Bank would help US businessmen.
Eveready adopted an export-oriented marketing strategy because of the small size of the 10-million consumer Ivoirian market. For this reason US trade officials are trying to attract mainly small-scale American investors.
One initiative was a 27-member trade and investment mission of small businessmen last January led by the Los Angeles Mayor Tom Bradley.
Another example at the Abidjan trade fair was Samir Lahiri, president of Roll Form Corporation, a small metal working company based in Limerick, Penn. Mr. Lahiri said he had made ``useful contacts'' for setting up a $1 million joint venture providing about 30 jobs.
The US ambassador to Nigeria, Princeton Lyman, believes that prospects are improving in Anglophone West African countries. Speaking to members of the American Chamber of Commerce in Abidjan recently, he said this was due to important structural adjustment programs which have ``a greater pragmatism and respect for the private sector.''
The US trade deficit with sub-Saharan Africa totals some $6 billion, one third of which is with Nigeria, Ghana, and Liberia. Mr. Lyman warned that the deficit with Nigeria, the largest black African trading partner, is likely to increase ``dramatically'' in 1987 following the country's banning of wheat imports.
Lyman singled out Nigeria for special mention. ``Just over a year ago, Nigeria was not thought of kindly in international financial circles,'' he reminded listeners. Since then, it has adopted ``one of the most fundamentally sweeping structural adjustment programs on the continent.'' If adhered to, the Nigerian program could be a showcase for market-oriented policies and economic adjustment in Africa.
``Nigeria will earn at least $5 billion in foreign exchange every year and will spend every bit of it,'' Lyman said. ``That is unique in Africa and filled with opportunity.''
Veteran US businessmen, however, remain cautious about business prospects in Nigeria and other Anglophone countries. For instance, a tight Nigerian monetary policy has caused a liquidity crunch and sharp contraction of the local market. The new, more liberal tariff policy is forcing many local manufacturers out of business. Smuggled goods continue to undercut local products, while corruption remains a major obstacle for businesses.
The survivors still have to battle with complicated, time consuming customs procedures to import legally. Most of all businessmen are concerned about getting paid for their goods and services.
But despite all the hassles, there is mounting US business interest.