Africa's potential seen lost on U.S.

Tanzania embraces an entrepreneurial, capitalist spirit

During a weeklong visit with President Bush last month to five sub-Saharan African nations, Mr. Geldof pointed to the continent's increasing stability but lamented the lack of U.S. business-sector investment.

"What is it that the Chinese get that we're missing?" he asked.

The rate of Chinese trade and investment in Africa is exploding, and while it is driven mostly by the government in Beijing, the private sector is increasingly involved.

U.S. investors and businesses have not caught on to the growing potential in Africa, business and government leaders said.

The consequences of this disparity could be of far greater importance for Africa than for either the U.S. or China. Opportunities abound for Washington and Beijing, but their different approaches to investment and business expansion could reap vastly different outcomes for African nations.

Much of the U.S. government-backed investment is aimed at working with African institutions and companies, and there are some U.S. efforts to painstakingly build the African middle class from the bottom up (see accompanying article), which is key to the continent's long-term stability.

Chinese investment, however, is delivering quick fixes to immediate infrastructure needs on a continent where many road systems, ports, railways and other means of transportation have been destroyed by years of conflict and neglect.

So far, Chinese loans have been tied mostly to the country's mining and oil projects, and they usually involve Chinese labor and technology and could prove to be unsustainable.