Investment in Africa 'ignoring social standards'

PUBLISHED : Saturday, 24 March, 2007, 12:00am
UPDATED : Saturday, 24 March, 2007, 12:00am

Financiers urged to boost engagement with rights NGOs

Human rights activists have urged mainland financial institutions to establish a dialogue with ordinary Africans and environmental groups when they plan projects on the continent, to raise the quality of their investments and improve China's international reputation.

'Chinese investment institutions should strengthen their engagement with international and local organisations,' Peter Bosshard, of the US-based environmental and human rights organisation International Rivers Network, told a Washington forum on the role of the Export-Import Bank of China (China Exim) in Africa on Thursday.

'This will help the Chinese develop investment standards based on common and acknowledged practices,' he said.

There has been growing international concern about the environmental and social impact of China's rapidly increasing investment in Africa.

The World Bank estimated that trade between the two regions topped US$50 billion last year.

During November's Forum on China-Africa Co-operation in Beijing, President Hu Jintao said the mainland would provide US$8 billion in loans and preferential buyer credits, including a US$5 billion special fund, to encourage Chinese investment in Africa.

Activists say Chinese investments are being conducted with blatant disregard to international environmental and social standards and exacerbating human rights abuses in the region.

Mr Bosshard said Chinese lending was implemented with 'no scruples' because loans lacked political and social conditions apart from the insistence that African borrowers support the 'one-China principle'.

Ali Askouri, a Sudanese with the London-based NGO Leadership Office of Hamdab Affected People, claimed that Chinese investment was fuelling human rights abuses in Sudan, which is the midst of a civil war.

According to Mr Askouri, China Exim's support of the US$1.2 billion Merowe dam in northern Sudan's Nile Valley is not only forcing the relocation of 50,000 Sudanese, but also igniting deadly clashes between the residents and police.

In addition, he claimed that Chinese companies involved in the construction of the dam had restricted local people's access to water. 'This is a form of soft colonialism,' he said.

Activists noted that the central government had pledged to promote balanced and harmonious global development. At November's forum, Beijing said it 'will give high priority to African concerns of environmental protection and sustainable development'.

Mr Bosshard said China Exim's executives had expressed the desire to have a dialogue with international groups.

'These are hopeful signs, but there is a long way to go,' he said.

The activists urged Chinese investors to talk with African citizens as well as leaders.

'We have not been given the opportunity to have dialogue with the Chinese,' Mr Askouri said. 'Their patronage is only with the ruling elites.'