Economic | Chinafrica - China Africa trade, China investment in Africa

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Africa Day in Beijing

Mercredi, mai 27th, 2009

The 46^th anniversary of Africa Day was celebrated in Beijing yesterday. Besides African envoys, it was attended by China’s State Councilor Dai Bingguo, who traced the long association between China and Africa and promised to drive their strategic partnership into new directions. The new type of partnership will be driven towards political equality, economic cooperation that is mutually beneficial, mutual trust and cultural exchange.

The process of economic integration continues in Africa and this is a step forward in its development. The two sides are also enthusiastically preparing for the fourth Ministerial Conference of FOCAC to be held in Egypt later this year.

China has changed its Africa strategy a little in the past few years. While economic support continues, it is now investing in projects where long term relations can be established. It is keeping a close watch on the political stability of African countries and pitching in to a far greater extent where this stability is evident. All Chinese ventures have not been successful and many have closed down in the last couple of years, but the success rate of Chinese ventures is far higher than that of other western nations. Africa in turn, banks on Chinese support and cooperation as well as technical advice to surge ahead and improve the quality of life of its people.

In the last decade, tens of thousands of Chinese people have uprooted themselves from their country and established their base in Africa. Statistics reveal that 750,000 Chinese and 900 Chinese companies are involved in investments worth $6 billion. They are involved in trade, agriculture, industry, mining, education, health and infrastructure projects. The sum total of Chinese interest in Africa is considered to be 50 times more than what it was twenty years ago.

Africa has benefited in many ways from this influx of funds and people. Its own work force has begun to get educated and its people now have access to better roads and communication networks, employment opportunities and, above all they are able to buy cheaper Chinese goods that have flooded all African markets. African land has been leased out to the Chinese, bringing in funds from a source that was not bringing significant returns.

Africa without Chinese support would have been reeling under the impact of the global economic slowdown and recession, but China has propped it up with its helpful stance and aid.

Source : Suppliers Africa

Tags: chinafrica, Economic, relationship
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China to be World’s 2nd largest economy by 2010

Mercredi, mars 18th, 2009

Yao Shujie of the China Policy Institute of the University of Nottingham (UK) revealed in a research paper that China is likely to overtake Japan to become the world’s second largest economy, either this year or by 2010.

Yao, one of the research paper’s authors, had predicted two years ago that China’s economy would surpass Japan’s in 2018 but made it earlier, thinking that the ongoing global financial crisis provides a good opportunity for China’s industries to reach that level faster.

The paper’s prediction for China’s economic growth is 7% to 8% in 2009 while that of the world’s most developed economies, including the U.S., Japan, Germany and the U.K., may not fully recover and rebound from 2008’s downturn until 2011 or 2012.

In January, China surpassed Germany to become the world’s third largest economy, after only the U.S. and Japan.

« Right now, we don’t have figures for Japan’s GDP in 2008, but I think China may have already overtaken Japan last year, » Yao told China Daily in a telephonic interview yesterday (Mar 10).

Based on the World Bank and IMF’s figures on China and Japan’s 2007 GDP and output growth rate of 2008, Yao estimated China and Japan’s GDP would reach $4.42 and 4.68 trillion in 2008, respectively.

Yao’s economic growth forecast is supported by China’s Premier Wen Jiabao, who said in his work report last Thursday(Mar 5) that the country would be able to achieve a growth target of about 8 percent this year if proper policies and measures are put in place.

The report also added that the global financial crisis, gives China the opportunity to greatly shorten the time needed to catch up with the US and become the world’s largest economy although it is not likely to happen in the next two decades.

However, Fan Jianping, director of the Economic Forecasting Department of the State Information Center, in responding to Yao’s report, said that ranking based on total GDP alone is meaningless, considering China’s extremely low per-capita GDP, which he believes is the most important indicator to determine whether a country is a developing country or not.

« It’s just a matter of time before China surpasses Japan in the economic pecking order. But, however big our economic output is, it won’t change the fact that China’s per-capita GDP is very low, » he said.

In the World Bank’s 2007 ranking of GDP per capita using equality of purchasing power, China was ranked 112th at $5,370, behind Egypt, El Salvador and Armenia.

Source : Konaxis

Tags: China, Economic
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China’s Economic Influence spreads further in Africa and Beyond

Mardi, février 24th, 2009

China has caused tremors in the Western world with its earnest effort to provide economic support to countries in Africa and other continents. Support includes import of much needed oil, minerals and other natural resources imperative for its own economic development, and exports of finished goods produced in China at very low costs. Chinese exports have made it cash rich with phenomenal cash surpluses at its disposal for investments in other countries. It is also being referred to as a “lender of choice”.

Close on the heels of the Chinese President, Hu Jintao’s “friendship and cooperation tour” of Africa, has come the news of YTO, a Chinese manufacturer of agricultural equipment, planning to construct five assembly lines in the next five years across the African continent. A tractor plant is being planned for Kenya. The joint venture between the company and the China-Africa Development Fund involves investment funding to the tune of CNY 250 million. YTO has been exporting agricultural equipment to Africa for nearly four decades, and has an established network to sell its machines.

Sudan, Africa’s largest country, was buckling under economic sanctions imposed on it, but China’s pitching in has saved its oil production, which is seeing rapid growth. Its oil fields are run by a consortium and are headed by the state owned company called CNPC-China National Petroleum Corporation. The CNPC has chosen Africa as the destination for one of its five overseas oil and gas cooperative regions. CNPC’s longest and largest foreign presence has been in Africa.

In a recent statement from the UN, African countries were among those cited that need to alleviate poverty through wealth creation rather than aid, by focusing on establishing manufacturing industries to enhance employment opportunities. The example cited in the report is of the poor Chinese village of Qiatou, which has grown from a poor rice-growing village to the manufacturer of two-thirds of the world’s buttons. This is just one of the Chinese success stories that Africa can learn from and base its developmental models on. It has the added advantage of Chinese support as China has reiterated its commitment to African development time and again.

China will be adding a 5 billion dollar fund to the China-Africa fund to enable the Chinese companies to invest in Africa. Also China has offered to train 15,000 African professionals. The China-Africa bilateral trade volume has increased to $106 billion since the time of its independence.

Source : Agricultural Tractors

Tags: Africa, Economic, Sudan
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Africa Day in Beijing

China to be World’s 2nd largest economy by 2010

China’s Economic Influence spreads further in Africa and Beyond