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Cablegate: Planes, Trains, and Automobiles: African Ministers

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 02 LAGOS 000685

SIPDIS


DEPARTMENT OF TRANSPORTATION FOR SZABAT AND SAMPLE
EXPORT-IMPORT BANK FOR GRANDMAISON AND SCURRY


E.O. 12958: N/A
TAGS: PREL EAIR NI EINV ELNT
SUBJECT: PLANES, TRAINS, AND AUTOMOBILES: AFRICAN MINISTERS
DISCUSS INTEGRATED TRANSPORTATION SYSTEMS

1. Summary: The first annual African Ministerial Forum on
Integrated Transportation (AMFIT) met in Abuja March 9 - 13.
Ministers called for better policy coordination and private
sector participation to help integrate African countries with
the rest of the world. Ambassador Jeter, Deputy Assistant
Secretary of Transportation Joel Szabat, and EXIM Bank

SIPDIS
Director Joseph Grandmaison highlighted the ways USG
assistance is helping develop safe, secure, and efficient
transport links in Africa. Among other things, the ministers
expressed support for a U.S. Aviation and Maritime Security
Initiative to reduce the susceptibility of transport systems
to terrorist attacks. End Summary.


2. Presidents Olusegun Obasanjo of Nigeria and Abdoulaye
Wade of Senegal
(whom Senegal's NEPAD Coordinator represented) hosted AMFIT
2003 as an African follow-up to the International Symposium
on Transport that USDOT had organized in October 2000.
About twenty African ministers and hundreds of other
representatives from Africa participated in AMFIT 2003 in
Abuja on March 9 - 13. Since its theme revolved around the
impediments to the development of a continent-wide transport
infrastructure, AMFIT's communique reflects a blueprint,
however inadequate it may be, of what an integrated Africa
transportation system might resemble.


3. Opening the conference, Obasanjo called on the delegates
to create an integrated Africa-wide transportation plan to
strengthen regional and international trade ties within the
NEPAD framework. Ambassador Jeter, in a welcome address at
the opening plenary session, echoed that the development of
safe, reliable, and efficient transport links can be a means
to foster economic development. He said the USG donation of
multi-million dollar state-of-the-art aviation security
screening equipment and EXIM financing of transportation
projects is supporting these objectives.


--------------------------------------------- -----------------
DOT Helping Develop Safe, Secure, and Efficient Transportation
--------------------------------------------- -----------------


4. Joel Szabat, Deputy Assistance Secretary for
Transportation also expressed support for AMFIT's goals and
gave examples of DOT's efforts to help governments develop
safe, secure, and efficient transport systems. Szabat said
the Open Skies program has improved aviation safety and
strengthened US-Africa air links. The USG's approval of World
Airways' beginning charter service between the United States
and Nigeria, once authorized by the GON, will be a positive
outcome of such cooperation, he said. He went on that USDOT
has helped to strengthen the Aviation and Transportation
Ministries' institutional oversight and security training for
personnel in the last year.


5. During the conference, Szabat met separately with
Nigerian Minister of Transport Ojo Maduekwe to discuss ongoing
cooperation. Szabat gave Maduekwe a copy of an environmental
assessment of the Lagos Port Complex and said the USG hopes to help
implement some of the report's recommendations. Maduekwe
expressed appreciation for USDOT's support and said he looks
forward to cooperation. The biggest challenge facing the
Ministry, he said, is its weak institutional capacity to
regulate the operators and its weak grasp of the technical
aspects of policy formulation. Szabat responded that USDOT
can put together a program in Washington to help the Ministry
develop an effective and independent regulatory body to
address urban congestion.


6. In various workshops, USDOT aviation and ground
transportation experts engaged African delegates on the
importance of developing sound transportation policy. The
discussions focused on the need for better planning and a
regulatory framework in which private operators might provide
safe and efficient service to end-users. Delegates also
stressed the need for better coordination between countries.


7. USDOT succeeded in its attempt to encourage inclusion of
an African Aviation and Maritime Security Initiative
statement in the final communique. Transportation ministers
agreed to adopt and implement new International Civil
Aviation Organization and International Maritime Association
standards strengthening security at airports and seaports.
The ministers said the African Union supports G-8 and APEC
measures to tighten aviation and cargo handling procedures to
guard against terrorism.


--------------------------------------------
ExIm Finance for Infrastructure Improvements
--------------------------------------------


8. EXIM Bank Director Grandmaison described the Bank's
efforts to provide financing for infrastructure projects
including US-Africa air cargo links. Grandmaison announced
the Bank's approval of a $5 million loan to Overland Airways
for the purchase of two Beech aircraft, and added he hopes
AMFIT will generate more opportunities for the Bank in the
multi-modal transport sector. He challenged ministers to
think of transportation as a concept that represents more
than mere physical movement, adding that the concept can
embrace sound regulatory and customs policies that encourage
the exchange of goods. (An example of gross inefficiency is
the practice by Nigeria's Customs Service to inspect all
imported goods. Clearing goods through customs consequently
takes 25 days on average.) Grandmaison added that Nigerians
should use the Africa Growth and Opportunity Act (AGOA) as a
catalyst to develop the country's infrastructure. Better air
cargo links between Nigeria and the United States might
enhance the competitiveness of some Nigerian goods that could
qualify for export under AGOA.


9. AMFIT participants identified barriers to financing and
possible solutions. Many government delegates complained
about the difficulty of accessing funds for infrastructure
projects as a result of political instability that makes many
countries unattractive to foreign investors. Private sector
representatives promoted the use of build, operate and
transfer agreements by countries that lack the capacity and
capital for large projects. (Comment. Since the public
sector dominates Nigeria's economy, public-private sector
partnerships have yet to become popular. The government
finds relinquishing control over public enterprises
difficult, even though it lacks the institutional or
financial ability to implement projects. Control over public
enterprises often translates into easy access to resources
for personal gain. End comment.)


----------------------
Lessons and Next Steps
----------------------


10. Africa's transportation systems obviously need drastic
upgrade. Nigeria's Transport Minister Maduekwe described the
crrent state of Africa's infrastructure as a
"study in chaos" characterized by the poor quality of its
aviation, road, rail, and maritime links. Dr. Lisa Fox of
Harvard University tried putting a price tag on the
consequences of such poor transport links. She said the cost
of transporting goods in Africa accounts for 40 percent of
the retail value of such goods, twice the international
average. In the absence of an upgrade, African countries may
still find it difficult to compete internationally, even
under preferential trade schemes like AGOA.


11. AMFIT's final communique stressed the importance of
involving the private sector in infrastructure development if
desperately needed capital and knowledge are to be mobilized.
The ministers called for the institutionalization of AMFIT
within the NEPAD structure in order to follow through on
AMFIT's recommendations.


-------
Comment
-------


12. While the participants succeeded in identifying possible
solutions to Africa's transport woes, how their governments
will implement the recommendations, if all, will constitute
the true test of their success. The government delegates
voiced support for all the right measures: better policy,
regional cooperation, and private sector involvement. The
question remains whether NEPAD will ever become something
more than just a vision on paper. Regardless of its long-term
effect, AMFIT provided USG officials an excellent opportunity
to showcase U.S. support for Africa's multi-modal transport
infrastructure.


HINSON-JONES

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