China-Africa relations: Beijing says it will help pay for world’s largest free-trade zone
- Beijing will provide ‘cash assistance and capacity-building training’ for the African Continental Free-Trade Area, Chinese Foreign Minister Wang Yi says
- Zone, which is set to open for business next year, spans 55 nations with a combined economy of US$3.4 trillion and 1.3 billion consumers
China says it will help to finance the development of an Africa-wide free-trade area, which on completion will be the world’s largest, spanning 55 nations with a combined GDP of US$3.4 trillion and about 1.3 billion consumers.
The free-trade area, which has its headquarters in the Ghanaian capital Accra, is expected to come into effect next year, after being delayed by the coronavirus pandemic. All but one of the 55 members of the African Union – Eritrea – have signed the deal, while 30 have both signed and ratified it.
David Shinn, a professor at George Washington University’s Elliott School of International Affairs and a former American diplomat, said China’s apparent commitment to the AfCFTA was a positive development, but the devil was in the detail.
“What exactly will China offer to support AfCFTA and how does it compare to what other countries may provide?” he said.
While China’s foreign direct investment (FDI) in Africa was both important and growing, it was still relatively modest, Shinn said.
Chinese FDI in Africa was US$49.1 billion last year, according to Wang.
China is, however, Africa’s largest trading partner, with two-way trade hitting US$208.7 billion in 2019, according to official figures from Beijing.
Chinese firms had also built dozens of economic cooperation zones and industrial estates across Africa, Wang said.
Since the creation of the FOCAC, China had helped build and finance more than 6,000km (3,700 miles) of railways, a similar amount of roads, nearly 20 ports, more than 80 large-scale power plants, 130-plus medical facilities, 45 stadiums and about 170 schools, Wang said.
Beijing is also funding the construction of the new Africa Centres for Disease Control and Prevention headquarters in Addis Ababa, Ethiopia.
According to figures from the China Africa Research Initiative at the Johns Hopkins School of Advanced International Studies in Washington, Beijing advanced US$148 billion worth of loans to Africa between 2000 and 2018.