The U.S. government should establish a comprehensive Africa policy that fosters more American investment on the continent while maintaining a commitment to aid, Stephen Hayes, president and CEO of the Corporate Council on Africa, told GlobalAtlanta.

The U.S. is still the largest investor in Africa, but about 75 percent of that comes from oil companies and is concentrated in about seven countries. China is more broadly invested and is poised to overtake the U.S. this year as Africa's top foreign investor, he said.

Aid and development shouldn't be abandoned, but they can't be the sole or even the dominant components in the U.S. government's Africa strategy, Mr. Hayes said in a filmed interview at the Coca-Cola Co. headquarters in Atlanta.

"I think really we've got to realize what China, India, the Europeans, the Arabs already realize: that we've got to have private investment into Africa if we're going to continue a strong U.S.-Africa relationship," he said.

While corruption and terrorism remain real problems in some African countries, they are "minor" compared to the "enormous" opportunities in a land of a billion people that's four times larger than the U.S., said Mr. Hayes. He visited Atlanta to speak at the World Affairs Council of Atlanta's first event, which addressed prospects for foreign investment in South Africa after the World Cup.

The main impediments to investors are "overburdensome bureaucracies" in some countries and a general lack of awareness about Africa among American CEOs, he said.

"Our major corporations are much like a country: the top man ultimately makes the decision, so we've got to get more top-level leadership familiar with Africa, comfortable with Africa, because it's an investment opportunity we're going to miss out on if we don't start moving over the next two to three years," he added.

The Corporate Council on Africa is working to combat that problem. The organization is fostering dialogue among its 180 members, which range from Fortune 500 corporations including Coke, Boeing Co. and Lockheed Martin Corp., to small and medium-sized companies.

The opportunities for small companies throughout Africa are almost "limitless," especially in sectors like agribusiness, technology and infrastructure, Mr. Hayes said. But with great potential comes daunting challenges.

In a place where sustained investment is necessary to build the right relationships, there should be more "public-private cooperation" on financing, Mr. Hayes said.

The U.S. government's Export-Import Bank, which aims to decrease risk for U.S. firms selling abroad, provides little assistance for small companies in African markets. The bank provided just $437 million in loan guarantees to Africa-invested U.S. firms in 2008, and most of the recipients were large, stable companies like Exxon-Mobil Corp., Mr. Hayes said.

The China Exim Bank, on the other hand, provided $13.1 billion in guaranteed loans for Chinese companies investing in Africa during 2008, the most recent year for which numbers are available. As a result, U.S. firms are falling behind, even though American investment would be preferred to Chinese in many countries, he added.

For American firms considering Africa, Mr. Hayes offered words of advice:

Take a long-term outlook. Mr. Hayes tells prospective CCA members that if they're not invested in Africa for the long haul, they're wasting their membership dues. That's mainly because it takes time to make the right connections in Africa. And although few things are true for all 54 African countries, business on the continent generally depends much more on relationships than in the U.S.

Find the right partner. "The hardest part, I think, about doing business in Africa is building the relationship," Mr. Hayes said. Although there are exceptions, "you can't just do it on a single trip and come back with a contract." Finding the right partner in Africa requires spending a hefty amount on trans-Atlantic travel.

Invest in the African people. Chinese investors have run afoul of Africans in small countries because they bring their own labor, creating a wall between the influx of Chinese immigrants and the native African populations. The faster African countries develop their own human capital, the more income their people will have. Better African capacity and governance means better markets for U.S. exporters. "They can't buy if they can't sell," Mr. Hayes said.

Visit www.africacncl.org for more information on the Corporate Council on Africa.

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