China in Africa. Africa in China

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In case anyone missed it, there was a major Summit of the Forum on China- Africa Cooperation (FOCAC) in Beijing earlier this month. It is worthy of note (more so than the many “Year of Friendship” announcements with…just about everyone) because of its scale, and the trends that it highlights in relation to China’s global ambitions.

The commercial story here is about access to resources. China needs them and Africa has them. Some in the West seem upset at the added competition (and price increases), but that is the free market at work, isn’t it?

However, the smell of politics is also in the air, with accusations that China is doing business in places the West would rather avoid (and, it must be said, in ways that some Africans are not too keen on either). An announcement that “Priority should be given to increasing the representation and full participation of African countries in the UN Security Council and other UN agencies” may point to one of the places China is hoping to win more “cooperation”. However, it must also be noted that Premier Wen Jiabao is reported to have said that “Chinese assistance to Africa is sincere, unselfish and has no strings attached”. So that is clear then…

According to reports, the Summit saw 48 African countries (including 35 heads of state) converge on Beijing to celebrate US$1.9 billion in trade deals, an US$8.3 billion railway deal for China Civil Engineering Construction Corp. in Nigeria, and billions of dollars in Chinese aid – which Bloomberg points out would make China a bigger lender to Africa than the World Bank. It also notes that:

    “China is using loans, export credits and other sources of financing to secure access to resources it needs to fuel its economy, the world’s fourth largest and among the fastest growing. China is the world’s biggest consumer of zinc, nickel and copper, the second-largest user of crude oil and the top importer of tropical woods.“

But all that is just a sign of things to come, according to an AP report:

    “China’s trade with Africa soared to $39.7 billion in 2005, four times its 2000 level, according to [Premier] Wen. He called for efforts to boost that to $100 billion by 2020, and promised to open China’s markets wider to African exports.”

China was made unwelcome when seeking to buy energy assets from the US (in the Unocal bid by CNOOC), and feels it well within its rights to look further afield and to follow its own agenda – even though that may be in competition, or even conflict, with strategic US and EU interests. While there are fears that this could help prop up unpopular governments, it is difficult for many in the West to take the moral high ground given the legacy of the colonial powers.

Expect more news from China in Africa. And more of Africa’s resources to appear in China. Don’t expect the West to adapt easily to China’s increasing global influence – commercial or political.

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2 Responses to “China in Africa. Africa in China”

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    […] l, and will cover domestic and overseas investments. China’s influence in places such as Africa and Latin America may be expected to grow as a result. Lou Jiwei, a former vice-ministe […]

  2. Archive » China’s “Go Global” Spending Spree| China Business Blog Says:

    […] t are getting interest from China’s overflowing foreign currency coffers. Africa is also high on the agenda, as is shown by the launch of the US$1 billion Sino-Africa fund recently lau […]

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