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MODERATOR: Thank you for taking the time to speak with the media here. Almost all of you have met or have worked with our chargé d’affaires, Jessye Lapenn before, who will be here as well. I would say I think we probably have time at least for a couple of rounds, let’s give the first question to you. Peter Fabricius with the Daily Maverick.
QUESTION: Thanks very much, for briefing us. I thought I’d ask you if I might, the most topical issue it seems now if you could maybe give us some insight into this attempted coup in Ethiopia, which a little
bit of confusion at the edge, as you know, we’re not quite sure what’s going on with this.
TIBOR NAGY: And it’s confusion to me at the edges as to where we stand actually now. But let me give you a little bit of background. As you know, when Prime Minister Abiy came in, he set off a series of very dramatic reforms both externally in the region, such as the peace with Eritrea and getting involved in some mediation with some other regional issues. But what a lot of the external audience doesn’t appreciate is the incredible reforms he undertook within the country, which had been an autocracy, plainly put. And also something I would call a Potemkin democracy where they had some of the structures of a democracy without actually carrying them through. And also the Ethiopian model of ethnic federalism, it was dramatic model. However, it works well in Switzerland because there the population gets to divide riches, it did not work nearly as well in Ethiopia because what the population had was poverty. So during the time of ethnic federalism, there were incredible internal pressures built up where the regions came into contact with each other, where you had different ethnic groups living just across the formal borders in the other regions. And that boiling pot with the lid on it also included disenfranchisement, tremendous unhappiness on the part of the young people because of lost opportunities, lost, you know any kind of political expressions. And I think you guys know how passionate I am about these youth issues. But so beyond that, when Abiy came in, he had to start taking the top off of the boiling kettle and however he takes it off, there’s going to be some steam coming out. If you remember shortly after he took power, which has now been more than a year ago, there was a grenade attempt against his life which I think injured 100 people. He escaped that. Later on, troops showed up at his office, uncertainty as to what their real intention was. But some people suspected it could’ve been extremely grave. And he diffused that with brilliant piece of challenging them to do I guess what the Brits call press-ups, we call push-ups. And he left everybody laughing. Interestingly enough, the general who was accused of masterminding this latest plot — I don’t want to call it a coup attempt, I don’t have the fact but this violent plot incident – – had been in prison under the old regime and he was one of the people that had been amnestied by Prime Minister Abiy who let out an awful lot of people. Let out an awful lot of people from jail. The situation is that there are vestiges of the old regime in power. Some of the elites are very unhappy with the reforms that Prime Minister Abiy is taking for a variety of reasons, including I’m sure some ill-gotten gains. Prime Minister is challenging this. He’s bringing in his own people. The Amhara, I guess they’re now called governors — at one point they were state president, but the governor who was assassinated had not very long ago been appointed by Prime Minister Abiy and was his person and in some of these regions for example, Tigre is a very difficult case for him because there the vestiges of the old regime are very much in control. Then the part of the plot that took part in Addis again, the alleged bodyguard, you know assassinating the commanding general. How much that was tied to the other plot — I don’t believe in coincidences but that’s pure speculation. Again, thankfully Prime Minister Abiy escaped this attempt it looks like because there are many, many more people in Ethiopia who are supportive of his reforms than there are opposed. But there is this vestige of the old regime left. So it’s certainly not clear sailing for him. From now on he has an incredible amount of issues he has to deal with. And at the bottom of it all is this question of youth unemployment which just presents an element of natural instability in the whole system. He’s moving as quick as he can but unfortunately, I wish I could say that this was the last of these attempts. But no one can be certain because you just don’t know when, who and where. One thing is for certain. He’s going to go full force ahead. This is not going to stymie him. But it is quite a shock because it could’ve turned out so much worse.
MODERATOR: Thank you. Colleen Goko-Petzer with Bloomberg.
QUESTION: Thank you so much for hosting this. This is very — quick question. Any talks of doubling trade and just mentioned Africa, I just want to —
TIBOR NAGY: Not doubling. Substantially increasing.
QUESTION: Substantially increasing. Any word of substantially — but I just wanted to know, which countries were you looking at specifically?
TIBOR NAGY: I’m so glad you asked me that. No specific countries, no specific industries or services. It is across the board. It’s going — it’s more opportunistic than planned. You know, we Americans, we’re not that much into five-year planning. We believe in being very opportunistic. I am asking every single one of my embassies from the smallest, which may be the Gambia to the largest, which would probably be South Africa or Nairobi, to become hyper engaged in supporting the increase of trade and investment
between their countries and the United States. And of course as I’ve said before, it’s a two-sided street. We have to cover both sides of the street. On the African side, obviously, our embassies have to work aggressively to try to identify potential investments. If their African partner is interested, then to match them up with partners on the U.S. side. But most importantly of all — and this is the key to this whole thing — is to work with those governments where those governments are open to this, to improve the business climate, the environment or what I like to call the level playing field, so that U.S. investors feel it’s worthwhile to invest there. Because if U.S. investors feel that the system is rigged against them and in favor of, you know, investors from a different place then they’re going to go elsewhere. They have, in Africa with 54 choices. You know? So — and let’s make sure we’re talking about the same thing when we talk about a level playing field. Some of the most important components, contracts, you know, you sign a contract that the contract will be honored. If there is a dispute then the judge will find in favor of the correct case, not you know an important person’s nephew or somebody who pays the most bribe. Then things like labor force participation, our investors like places where women have rights. You know where there is a certain level of education. They also like places where there is good political space for
everybody. Not you know single-party dictatorships where the population tends to be very unhappy. Also our investors tend to be you know, socially responsible. They respect the environment, they don’t smuggle out rhino horn and they also transfer technology. They hire a lot of local people. It’s not a case where anybody above turning a shovel comes from a different country. You know, we do our best to maximize the local content, local component and then work with local folks. So that’s how I want to do it. And then obviously the Washington side is a new Prosper Africa. So if we want to talk about Prosper Africa, we can do that. That’s the Washington side.
QUESTION: That’s (unintelligible).
MODERATOR: Let’s move on to Geoff Hill with the Washington Times.
QUESTION: Thank you so much. Excuse my hat. I suffer with glare. So —
TIBOR NAGY: I’m with you.
QUESTION: Just very briefly, something on record from my head office. On Monday we had a story, front-page world scoop about Chinese agents trying to break into Camp Lemonnier. And in front of the chargé and yourself, I’d just like to put on record that this would not have been possible without your public affairs people in Johannesburg and Pretoria and at AFRICOM, Tiffany Jackson-Zunker, Robert Markham here put me very quickly in touch with Darius Edgerton who’s acting spokesman in Washington and Rebecca Farmer at AFRICOM bound heads together and got a statement out of Camp Lemonnier and out of AFRICOM and we’re very grateful to the public affairs teams —
TIBOR NAGY: Thanks.
QUESTION: — in Pretoria and Johannesburg.
TIBOR NAGY: Thanks very much. And interesting though, I have not seen that statement or that story because I was traveling so — but thank you very much for that.
QUESTION: So my question goes to Djibouti and this 88 percent of Djibouti’s debt is held by the Chinese and last year, President Guelleh signed a decree expelling a UAE company from the container terminal they had built. They’ve now of course gone to Somalia and to Buru. And it just seems that the Chinese are about to take over the container port and there seems great worry that China could come to control, whether it be commercially and militarily the entrance to the Suez Canal. Is this a concern for
Washington? Can you tell us something about the background fears of the Chinese in that very narrow strait there?
TIBOR NAGY: Yeah, absolutely. It’s a concern. We’re watching that very closely. Here is the — and I don’t want to say it’s a conundrum, but the factors are, all of these countries are sovereign states. So it’s for them to decide who they want to trade with, who they want to make contracts with. Fine. On the other hand, we feel like we have an obligation to point out to them when we believe that they’re getting into severe economic difficulties, for example with unsustainable debt because that is going to not only harm them, it will harm regional economies, it will harm in some respects, global economies. I mean we went through in the 19 — just in the last 20 years, you know, this big debt forgiveness for a lot of African countries. You know, the highly indebted four countries, HIPC debt forgiveness, which
amounted from and again it was not purely the African countries’ fault. Just with corruption you have a corruptor and you know, and people gave all of this debt to the countries and then there was no way they were going to pay it back. So everybody took a pretty severe bath on that. Back to ground zero, now all of the sudden are we going to go through another cycle of that and are these debts going to be run up and then the countries are going to say whoops, you know, we can’t pay this anymore. So would you, you know, West chip into a pot and help us out of this again.
And I certainly would not be sympathetic and I don’t believe my administration would be sympathetic to that kind of a situation. So you have to also question some of the debt that this is being used for. You know, how worthwhile are the projects? Some of these countries will sign on the dotted line and incur incredible amounts of debt knowing that it’s not going to be in their timeframe that the real pain will hit. It will be in their kids’ and their grandkids’ timeframe exactly when some of these countries will not be able to repay it. So it is a very serious problem. And you do add the security aspect to it. You know for example you will remember that not long ago, the Chinese were shining lasers in the eyes of our pilots.
QUESTION: In Djibouti?
TIBOR NAGY: Yeah. In Djibouti. And a number of other incidents like that. So again, Djibouti is a sovereign state. It is in a very secure location as we say, you know, everything is like in real estate, location, location, location. So we will obviously engage with the Djiboutians, with our friends and where necessary of course communicate our concerns to the Chinese.
MODERATOR: On to Joe Bavier with Reuters.
QUESTION: Great. It’s Prosper Africa, actually. You can — we’ll just get straight into that. This was announced initially by both in December, we didn’t hear — short on details at the time, we didn’t hear much about it for months. There was a rollout in Mozambique.
TIBOR NAGY: Right and I was part of that.
QUESTION: Right. I tried to follow that. I wasn’t able to travel to the conference. But I did read the speech from the head of USAID, they said this wasn’t a new program. My understanding is, there is no kind of new allocation of resources currently associated with it. Though you do have a Build Act and creation of a new development finance institution. What actually is it if it’s not a new program? What are the concrete objectives and how are you going to be able to judge success? I mean what are the metrics here?
TIBOR NAGY: Great. You know so all the smoke and where’s the fire, so let me go into that. It is a new program in a very key fashion. And I’ll use an example that for decades, we at least on the American side, have been pounding the desks of ministers of trade in Africa telling them that they need to establish one-stop-shops to attract investors. The truth is, that in all that time, never did the United States have a one-stop-shop for our companies who wanted to invest in Africa. Now we’re moving to remedy that. There are 15 at least, 15 different U.S. government agencies and organizations that are involved with doing trade with Africa. Never have all of those activities been brought under one umbrella. I’m not saying yanking them out of where they exist because it’s logical where they exist. But bringing them under one coordination umbrella so that you can actually exercise communications between them instead of having these in silos. So U.S. potential investors, especially the medium and the smaller companies, have been very frustrated. You know you have the gigantic corporations, like we had Exxon was there. Exxon, company like Exxon can do business anywhere in the world. They don’t really need the help of the United States government except in rare instances. But there’s a tremendous amount of interest in the U.S. on the part of these medium and smaller sized businesses that really would want to invest in Africa and they need a lot more help. They are much more risk-adverse, they need help with financing. So by putting all of these U.S. government activities together with the Build Act, which you guys know is creating the International Development and Finance Corporation, starting business hopefully next fiscal year, so October 1 with capitalization of $60 billion as opposed to the $29 billion which OPIC had, including equity possibilities, targeting mostly developing countries but not limited to U.S. companies. So that will be a new mechanism that will be available under this Prosper Africa. The other part of that which again we have not had yet but in this day and age you absolutely have to have, is a really functional website. So that you do have the soybean associates in Lubbock, Texas and you know they’re interested in soybean in West Africa. So they can click on there and hopefully with two clicks, we can put them in touch with the right person at the U.S. Embassy Lome, for example. Another part of this will be our embassies. Because our embassies have never been systematically focused on promoting trade and investment. And with Prosper Africa, that is going to be a large piece of it. As what we were talking about before with the U.S. embassies not only beating the bushes in their countries but also providing support to U.S. companies going there and then again working with the
African governments to help improve the investment climate.
So between the African side and the American side, and the website, I think it’s going to be a really exciting prospect. As I’ve said in some of my speeches, I wish that this had come along 20 years ago. Because we’ve needed it and now finally with the administration’s Africa strategy out in October then Prosper Africa, which you know, the skeleton’s there, we’re just now putting the flesh on it so to speak. And then there will be money, there will be new money available for proper launch of this. And hopefully it will become a permanent part of the U.S. government structure because it’s something we need to do. American companies, aside from the majors, are just not used to doing business in Africa. And they need to be, because Africa is going to be the market of the century.
MODERATOR: Onto Jean-Jacques Cornish.
QUESTION: Thank you very much. It’s been said that the Trump Administration put Africa not even on the back burner but literally ignored it. Are you satisfied that this Prosper Africa and efforts now have moved Africa front and center of U.S. thinking? And then on a tangential note, the persistent or the determination of the South African government to take land without compensation, how will that affect the thinking in American business and in Washington?
TIBOR NAGY: Two separate questions.
TIBOR NAGY: But I’ll let him get it. I tell most people I’m 70 years old so please just one question at a time. But okay, but with yours, I really disagree with the fact about the Trump administration having it off the burners or on the back burner because I’ve come to this, you know, into the Trump administration. But I’ve found just the opposite. I’ve found intense interest across the U.S. government. I did not speak with the Supreme Court Justices but with my conversations on the Hill with members of Congress, I mean across the political spectrum, 180 degrees from the furthest right to the furthest left. Huge commonality on viewing Africa and wanting to see Africa succeed and wanting to see U.S. involvement in Africa grow. Same with the White House. I mean it was the White House that prepared and coordinated the President’s Africa strategy which is again something that — it’s advocating exactly the types of things I’ve been advocating for the last two decades. And then the Prosper Africa piece, it is absolutely the right focus on Africa. I mean one of the things I say often, one of my slogans is that we should all be looking at Africa through the wind screen, not the rearview mirror. And I believe that this absolutely looks at that. Our government officials, for example, I was telling you guys that I was supposed to go to other countries but instead I ended up going to Sudan first. Again, because of the intense interest by the people above my, you know, station in life who basically are absolutely intent on wanting to know up to the minute as to what’s going on in Sudan. So yes, the big news stories are caught by the — you know, the stories of the week that eat up all the oxygen of the media time and whether it’s North Korea or Venezuela but at the same time, goodness gracious, Africa is being dealt with across the board. But also for the first time — and if you look at U.S. policy towards Africa for the last 60 plus years since decolonization, there’s been an inherent tension between the long-term goal of wanting a prosperous, peaceful, stable Africa that is fully integrated into the global economic and political system. And then the short-term crises which seem to overwhelm whoever is dealing with Africa. Up to now I maintain that the short-term crises have been winning and finally with this administration there’s really a focus on an outcome which they’re mobilizing the entire scope of the federal government to achieving. So I’m absolutely delighted to be working on Africa at this stage of my career which I never thought I would be after I retired, having spent 22 years on the ground in Africa at eight different places. And I really think that this administration gets it.
MODERATOR: So we had a second question on land reform here in South Africa if I may, we’re about 23 minutes in, we might have time to —
TIBOR NAGY: Yeah.
QUESTION: I’ll forgo my second question maybe.
MODERATOR: Well how about — I don’t think there will be time for a second due to responses but let’s go to Andy Meldrum with AP for a question and then if there’s time, we’ll go back.
QUESTION: Good afternoon, I‘m looking for your reaction to the attempted coup in Ethiopia.
MODERATOR: I sent you a text — I don’t think you got it.
QUESTION: Oh did you? I didn’t get it sorry.
MODERATOR: But I’ll send you the audio —
TIBOR NAGY: That’s what I talked about.
MODERATOR: — that was the first question from Peter.
QUESTION: Oh okay, okay, sorry.
TIBOR NAGY: Yeah, no, very good. Because I had heard that you wanted to ask that but then that came up first so I spoke at that at length and I think that my answer will probably respond to what you were interested in.
MODERATOR: Do you have a back-up question?
TIBOR NAGY: Yeah. Yeah, Sudan. And again, interestingly enough, the Ethiopian Prime Minster had just gotten back from Sudan, because that fits in with the scope of what we were talking about earlier that he really has been hyperactive externally and internally in trying to address the incredibly complex issues that Ethiopia has to face. Here’s Sudan. The good news is, that this is one of those problems that the entire international community is aligned on in wanting the same outcome and basically simply stated, it’s a civilian-led government that is acceptable to the Sudanese people. And we have been delighted in our many consultations with the whole range of international actors that everybody says that is exactly what they want. We’ve had consultations bilaterally. We’ve had consultations multilaterally. We had a Friends of Sudan meeting in Washington shortly before I left. There was another one in Berlin a couple of days ago. There was also a quad meeting in London of some of the gulf parties. They have a meeting in Addis.
Here’s the fundamental problem and it is a tragedy in effect because when the events first unfolded in April, the Basheer government was kicked out. The transitional military council and the Forces for Change, the FFC, were working as partners, cooperating. If you remember when they set up the initial TMC, the FFC objected to a few of the people and they changed them, you know, like that. I think within a day they changed them. Since then, the evolution of the process has been very negative in regards to cooperation between the two groups. They have unfortunately evolved from a position of working as partners and mutual trust to a position where they see each other in very hostile terms with negligible trust between the two groups. Fair to say that there are spoilers on both sides and three times they have come close to an agreement on a transition and three times that has been scuttled at the last minute by spoilers. The most recent time was the June 3rd attack on demonstrators, the violence, the murders, the rapes, the injuries. So all of that has served with each other, to absolutely discredit each other. So now it appears that the best mechanisms to come to some kind of an agreement really is through mediation. The United States of America, along with — and I don’t want to speak for others but I can speak for the United States of America is fully supportive of the African Union’s role in mediation along with Prime Minster Abiy who is current chair of IGAD. He’s also mediating — they’re doing this together, it’s not competing, you know, efforts.
He has appointed as a mediator, former Minister and Ambassador Darier who I have known for 30 years. So they obviously have with Professor Laban and Minister Darier, they have two extremely knowledgeable and highly professional mediators. So everybody is hoping and there’s no reason why they should not come up with a transition plan. You know they’re going to be squabbling over the seven from here, seven from there, who’s going to be the other — that’s not for us to get into. That’s for them to decide. But the fact is, for the region and for the world, there are a number of outcomes and unfortunately some of them are extremely negative. And would very seriously impact the region. For example, one outcome — and we have to face it — would be political chaos, a descent to political chaos along the lines of either Libya or Somalia. And the last thing for example, Egypt needs is another Libya on its southern border. The last thing Ethiopia needs is another Somalia on its northwest border. So that would be a horrendous outcome. Another equally negative outcome would be vestiges or the old regime taking power back, you know, either through their sitting — I mean they’re sitting on weapons, they’re sitting on incredible amounts of money which they’ve gotten you know, during their time in power. So that would be an extremely negative outcome. The positive outcome that everybody would like to see as I said, is this transition to a civilian-led government. It would be very unhelpful also if either one of the two sides tried to unilaterally create a government. Because that could have the trappings of what we’re seeking but it would probably not be accepted by most of the international community.
So yeah, just unilateral creation of a government would not be positive. But you know, we have now also a special envoy, Ambassador Don Booth who has incredible expertise in the region. He is staying engaged and yes there are a lot of these special envoys and meetings and things like that but I want to underline that everybody is working together. We’re very careful to not have parallel processes so then the Sudanese go, you know, forum shopping amongst them. That it’s very important for everybody to support the Africa Union process at the end of the day.
MODERATOR: If you would allow one final question? I do want to go back to Jean-Jacques’ question because I realize we haven’t had a South African specific question in our discussion here today so would
you reiterate your —
QUESTION: Certainly. The determination of the African National Congress Government to expropriate land without compensation witnesses?
TIBOR NAGY: Yeah, I was fortunate that one of the groups that I was able to meet with here directly was related to the whole land question and it wasn’t just the expropriation part of it but it went beyond that to explain it to me, the full ramifications of the land issue, you know, regarding the collective ownership, the individual ownership, the ability to use land for ban clones and of course the expropriation. As I think everybody knows, President Trump asked my boss, Secretary Pompeo, to monitor the situation, to look at it carefully which is what we are doing because in fact, that could be a loaded issue that U.S. investors would take a very close look at when making a decision on whether or not to invest in South Africa. So we will closely monitor the evolution of the issue through the various stages of the constitution and the parliament and see, you know, just where it comes out. But I leave South Africa with a much fuller understanding of all of the various aspects and that how different the South African situation is from say what happened in Zimbabwe. Where it was totally you know outside any scope of jurisprudence or legal process.
QUESTION: Can I just have a follow-up to that? One of the conditions for AGOA qualification is respect for private property and land. Is this measure for something that could be a disqualifier for South Africa?
TIBOR NAGY: It would have to be looked at as to what the final measure is. You know it’s not the kind of thing where I would want to speculate ahead of time. If this then that, you know, what quid pro quos. But the AGOA requirements are quite straight forward.
MODERATOR: This will be our last comment or question.
QUESTION: It’s not a question, not a question. Just on the land, there is a strong phrase among young people in my country in Zimbabwe, I don’t want to be on the land, I want to be on the internet. We need to catch the new generation’s — it’s not about growing pumpkins, it’s about having proper jobs. That’s in Zimbabwe.
TIBOR NAGY: Yeah, well that’s — and I have said that in so many speeches. You know, when you talk to young people across the African continent, they want jobs, jobs, jobs. And the movement towards urbanization is just as much of a tsunami as the emergence of the young people. So you know people want to live in cities. I married a farmer’s daughter so I understand how that goes and people want to live in cities and they want good jobs that give them the same thing that young people in other parts of the world have. And that’s absolutely an aspect of the whole issue that you know, needs to be examined going forward.
QUESTION: Specifically to clarify.
MODERATOR: You have a plane to catch.
TIBOR NAGY: I do.
MODERATOR: It’s up to your time — you’ve gone over half hour, you’ve been very generous with your time, so I think we’ll wrap it up.
TIBOR NAGY: Okay.