The China-Africa Development Fund was set up in June 2007 to enhance the level of Chinese investments in the African continent. The state backed fund started out with an initial investment of $ 1 billion put in by the China Development Bank Corp., and is likely to touch the $5 billion mark. It has funded various developmental projects and set up many industries. However, it has been a passive investor that was not at liberty to even hold a majority stake in a company. Mark Fung, the general counsel for the company stated in Hong Kong, that the fund would like amore active role in the future, though at present, it lacks the required expertise to participate in the management of the projects it funds. The fund’s investments are generally made for an eight to ten year period.
Among the projects assisted by the fund, is the cotton planting and processing unit in Malawi, the Ghana power station, a glass factory in Ethiopia, as well as trade zones in Nigeria and Egypt. The total investments made in twenty such projects amounts to $400 million. Refuting claims of critics that environmental rules were ignored while assisting in raw material and oil exploration, Fung stated that an environment assessment has always been conducted in each of its projects before funds were released. The fund is part of China’s long-term strategy to fill in the gaps left by the western nations due to the economic downturn and the recession hitting their economies.
China has strengthened its place and presence in Africa in the process, helping its infrastructure development and providing technical expertise and funds the Southern continent so desperately needs. The fund has opened a representative office in Johannesburg and will be opening similar offices all over Africa. China is commitment to the development of Africa and the fund is one of its various channels to ensure the flow of investment into the continent. China has a set of eight policy measures listed by its premiers to assist Africa in the sectors of tourism, industry, agriculture and infrastructure. African nations have been seeking Chinese expertise in capacity building and building its private sector.
Source : Suppliers Africa
