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Home > Hot Topics > National Day Features
China and Africa Build a New Partnership on Old Ties
2007/09/27

By Chang Ai'ling (China Features)

 

Many Chinese in their 40s, like Zhou Zhicheng, have an impression of Africa that comes from the Tanzania-Zambia Railway China helped build in the 1970s or Chinese volunteer doctors working in Africa since the 1960s.

Zhou, aged 44, said for years he had imagined Africa as a land of deserts with the Third World economies, but the impression started to change in 2004 when he was appointed team leader in the project to design and build a satellite for Nigeria, the first four-frequency-band geo-stationary satellite for Africa.

"I had the chance to visit Abuja to deliver the satellite to Nigeria after it was launched in China and tested in 2007," Zhou says.

In Zhou's eyes, "Abuja is well planned and the people I met were professional and eager to learn. I was impressed with the country's vitality and ambition."

To Zhou, the "ambition" to develop Nigeria and other African countries means great business opportunities for China, which is eager to expand the international market as its economy and technologies are developing rapidly.

"After more than two decades of reform and opening up, China now finds itself in a position to offer what African countries need – sophisticated technology appropriate to African conditions at relative low cost, and expertise in poverty alleviation and economic development," says Liu Naiya, a researcher on African affairs with the Chinese Academy of Social Sciences.

"The satellite project is a good example. We have the technology and the Nigerians have the demand. Such cooperation is mutually beneficial."

Compared with Western technologies, those of China are not more advanced. But, Liu notices, the services China provides are usually more cost-effective. And more importantly, the fact that China is more willing to transfer its technologies makes its high-tech products more accessible than Western products to African countries.

According to Zhou, under the Nigerian satellite deal, China not only designed, built and launched the satellite, but also built two ground monitoring stations and trained 50 Nigerian technicians.

"The training, starting from basic knowledge to satellite monitoring and designing, lasted 15 months," Zhou says. "The Nigerians said in their evaluation reports after the training that 'the Chinese are selfless' and the training is 'comprehensive'."

China-Africa trade has for decades been dominated by low-end products. Observers say the changing trade pattern, featuring increasing exports of Chinese high-tech products instead of labor-intensive agricultural or apparel products, demonstrates China's intention for more balanced trade and greater economic involvement in Africa.

"As China develops and the majority of African countries embrace market-oriented reforms and readjustment, economic relations have evolved gradually from free aid and donations to pragmatic economic and technological cooperation," Liu says.

The latest figures from the Chinese Commerce Ministry reveal that trade between China and Africa rocketed dramatically from 12 million U.S. dollars in 1950 to 55 billion U.S. dollars in 2006 with a 2.1 billion U.S. dollars of trade deficit on the Chinese side, making China Africa's third largest trade partner.

By 2006, China's direct investment in Africa has hit 6.64 billion U.S. dollars, covering projects of telecommunications, electric power, water conservancy, transportation, agriculture and manufacturing.

In a fresh effort to encourage Chinese companies to invest in Africa, China launched the China-Africa Development Fund in June with an initial 1 billion U.S dollars and the goal of expanding the pool to 5 billion U.S. dollars eventually.

On Nov. 6, 2006, Chinese President Hu Jintao and Algerian President Abdelaziz Bouteflika signed a joint statement in Beijing, declaring a strategic cooperative partnership between the two countries.

On Nov. 6, 2006, an exhibition of African products was held in the Beijing International Convention Center.

At the helm is Beijing's policymaking China Development Bank (CDB), which forecasts a 50-year lifespan for what's being called the world's largest, single fund aimed at African development.

The fund would invest in Chinese companies that set up operations in Africa and provide advice to those planning to invest there, says Gao Jian, chairman of the new China-Africa Development Fund Co. and vice president of the CDB.

But the fund would seek neither the majority nor the largest shareholding in the businesses, Gao says. "Profits are not the fund's first priority. The China-Africa Fund first seeks to advance economic, political, and social development."

While welcomed by many African countries, China's investment in Africa also brought concerns.

Some African commentators have pointed out that China and African countries are both developing, and labor-intensive industries still play a major role in their economies. This similarity leads to competition in certain fields, such as the textile and apparel industry. They also cite the limited regard for environmental and safety standards of some Chinese companies as drawbacks of Chinese investment.

China's leaders are responding to such concerns and criticism. During an eight-country tour in Africa early this year, Chinese President Hu Jintao was at pains to change that perception. In a speech to South African university students, he emphasized "mutually beneficial economic cooperation". In Namibia, he counseled managers of Chinese companies on bearing social responsibility and promoting harmony with local people.

"The Chinese government does not encourage Chinese enterprises to take other countries' markets by purely increasing the quantity of their exports," Hu said during the tour.

To ease tension brought about by China's textile and apparel products, China has announced a series of measures, including voluntarily capping clothing exports to South Africa, providing technical training and assistance to textile industries of African countries and prohibiting 28 categories of textile investment projects.

Although China has been running a deficit in trade with Africa in recent years, China has promised to further expand imports from African countries.

At the Beijing Summit of the China-Africa Cooperation Forum in November 2006, President Hu announced eight steps to consolidate the "new type of strategic partnership" between China and Africa, including further opening China's markets to exports from Africa's least developed countries (LCDs) by increasing from 190 to 440 the number of products receiving zero-tariff treatment.

The measures also include building 3-5 trade and economic cooperation zones in Africa in the next three years, providing 3 billion U.S. dollars in preferential loans and 2 billion U.S. dollars in preferential buyer's credits to African countries and training 15,000 African professionals.

During the summit, the Chinese authorities also said they would further regulate their African activities and improve management of African projects. Premier Wen Jiabao said that projects implemented by Chinese firms should be conducted in an "open, fair, just, rational and transparent" manner and more efforts would be made to ensure that Chinese projects were high quality, safe and environment-friendly.

China's active economic involvement in Africa also caused alarm and suspicion particularly among those countries that previously used to enjoy unfettered market access to Africa.

Some skeptics claim China's interest in Africa is oil and resources-driven and that its closer economic and trade ties will lead to a kind of "neo-colonialism."

Chinese Commerce Minister Bo Xilai dismissed such accusation during the annual parliamentary session in March 2007, saying, "China was once a victim of colonialism and it has never had a record of colonizing other countries."

The Beijing Summit of the China-Africa Cooperation Forum opened

 in the Great Hall of the People's in Beijing on Nov. 4, 2006.

Bo said China's oil trade with Africa was normal and based on reasonable market prices. "Statistics show that 36 percent of Africa's oil exports in 2006 went to Europe, 33 percent to the United States and China only took 8.7 percent. If importing 8.7 percent (of African oil) can be seen as resource plundering, then how should we see the 36 percent and 33 percent?" Bo asked.

Chinese observers point out China's involvement in the oil trade and other economic sectors in Africa is welcomed by African countries as it provides Africa with opportunities to diversify the continent's external partnerships.

"African countries have more choices with China's coming, which, to a certain extent, gives them a greater say on their own resources," says He Wenping, director of the African Studies Section at the Chinese Academy of Social Sciences in Beijing.

Xu Weizhong, director of the Institute of Asian and African Studies under the China Institute of Contemporary International Relations, says that China's welcome in Africa, to a great extent, stems from the "sincerity and friendship" the country has demonstrated over past decades.

"In the 1960s and 1970s, Chinese engineers were hard at work throughout Africa, constructing stadiums, laying down roads, and building hospitals for the African people even though China itself was suffering from economic difficulties," Xu Weizhong says.

In the 1980s, when Africa was to some degree "forgotten" by the Western world, China continued to strive to improve its relations with Africa. Since 1991, China has maintained a tradition that its foreign minister starts the annual official visits with Africa.

"China's actions have shown that it is no fair-weather friend to Africa," Xu says.

With annual trade growing by 40 percent in recent years, Premier Wen Jiabao told Chinese and African entrepreneurs during the Beijing Summit of the China-Africa Cooperation Forum that China hoped the two sides would fully tap cooperation potential and strive to bring the trade volume to 100 billion U.S. dollars by 2010.

Wen also reiterated China's African policy, which is based on "political equality and mutual trust, mutually beneficial economic cooperation and cultural exchanges".

"We will never forget the precious support that African countries have given China in its efforts to safeguard national sovereignty and territorial integrity. China will, as always, continue cooperation with Africa on the basis of sincerity and mutual benefit," Wen said.

On Sept. 21, 2006, a worker of the Hisense Group in South Africa was packing television sets.

A conference on China-African trade and investment cooperation was held in Wuhan of Hubei Province from July 2 to 3, 2007, attracting 49 trade representatives from 21 African countries.

 

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