China treads lightly to improve image in Africa

PUBLISHED : Saturday, 28 January, 2012, 12:00am
UPDATED : Saturday, 28 January, 2012, 12:00am


China plans to chart a delicate course in Africa to avoid a backlash over its growing economic footprint on the continent and a trade imbalance that critics say favours Beijing and mainland firms.

Sino-African trade rose more than 23.5 per cent to more than US$160 billion in 2011, from US$129.6 billion in 2010, deputy commerce minister Gao Hucheng said. China overtook the United States as Africa's biggest trading partner in 2009.

China's cumulative investment in Africa now totals US$40 billion, including US$14.7 billion of direct investment, and there are more than 2,000 Chinese-invested firms in Africa, Gao said.

But while trade has grown, it carried a US$10 billion imbalance in China's favour in 2010, prompting critics to say that it's a one-way street in favour of China, which imported mainly oil and raw materials while exporting cheap manufactured goods in return.

Gao said China would redress its trade imbalance with Africa by opening its markets up to African goods, waiving customs duties on its products and encouraging Chinese firms to import more African products, and would export higher-value products to Africa 'to win the hearts of Africans to the made-in-China brand'.

China will increase its investments in African manufacturing and transfer technology and management skills to 'change from made-in-China to made-in-Africa', Gao said.

Hugo Williamson, managing director of the Risk Resolution Group, a UK risk consultancy, said: 'China's significant trade imbalance has in the past been a major source of discomfort in Africa, causing political and social complications for China's investment across the continent.'

African unions have complained that cheap Chinese goods make locally produced goods uncompetitive, while African governments worry about the impact of cheap Chinese imports on local employment, said Williamson. In Zambia for example, newly elected President Michael Sata said at his inauguration that he would 'expel bogus Chinese investors' from his country.

Jia Qinglin, chairman of the National Committee of the Chinese People's Political Consultative Conference, and deputy foreign minister Zhai Junwill, attend the 18th African Union Summit, which runs until January 30 in Addis Ababa, capital of Ethiopia.

'Jia's attendance at this summit sends a signal that no matter what the international situation, China will push for a new Sino-African strategic partnership,' said Zhai.

Williamson said: 'This move by the Chinese is a strategy to realign its engagement with Africa, and a response to misgivings about the Asian state on the African continent. Through building factories, the Chinese have the chance to create employment opportunities in Africa.'

As an example of a Chinese infrastructure project, the African Union is being held at the new Chinese-built African Union Conference Centre, said Zhai. China paid for the US$200 million centre, African Union Secretary General Jean Mfasoni noted.