Bilateral trade with China will exceed $10.8bn this year

In almost every corner of
Africa there is something
that interests China, writes
BBC journalist Adam
Blenford. “There is copper
to mine in Zambia, iron ore
to extract in Gabon and oil
to refine in Angola.
In other countries less
blessed by natural resources,
Chinese companies have
spied trading and investment
opportunities.”
Trade between China
and African countries is
expected to exceed $100
billion in 2010 with bilateral
trade in some instances
having risen by up to 65%.
According to the Chinese
Trade Ministry, more than
1600 Chinese companies
are currently investing in
Africa in the mining, trade,
agriculture, construction and
industrial sectors.
While China has a long
involvement with Africa
going back to the early days
of independence movements
in the 1960s and before, the
role of the East in Africa is
on the rise.
“With China growing
at 12% per annum the
rise of the East has been
phenomenal,” says Nicky
Weimair, senior Nedbank
economist. “Africa’s growth
is definitely tracking what
is happening in the East,
and therefore exports and
production on the continent
is increasing due to the
investment and development
that is happening.”
In South Africa, seen
by the East as the gateway
into Africa, bilateral trade
with China will exceed
$10.8bn this year, officially
becoming the country’s
largest trading partner.
Africa’s need
for infrastructure,
communications and power
is well met by China, whose
interest in the continent’s
mineral resources cannot be
under-estimated.
Increasingly, the strategic
interests of China and Africa
are inextricably linked, says
the World Economic Forum.
Africa must, however, prove
it is a reliable, predictable
trade partner and attractive
destination for investment,
while China must listen to
what Africa wants.
“The challenge is to
define clearly with China
what we want and the
direction of investment.
Africa now needs to set
the agenda much more
energetically,” said Rob
Davies, Minister of Trade
and Industry of South Africa
earlier this year. “China
wants raw materials, but for
Africa to benefit we must
grow beyond suppliers of
dirt out of the ground that
goes somewhere else to be
processed.”
Research shows that
Africa’s growth is tracking
that of China. Chinese
demand – either real or
perceived – and relatively
buoyant commodity prices
are underpinning growth in
sub-Saharan Africa, says the
World Economic Forum.
Part of China’s
growth will depend on
Africa’s ability to supply
commodities. As a result,
China and Africa’s
relationship is changing
from one where contracts
were drafted and signed by
African leaders to a true
partnership, reflecting a
strategic relationship in
which Africa is increasingly
engaged.
“We have to understand
China’s priorities and use
them to our advantage.
Structuring mutually
beneficial economic
relations is what it is about.
It is in the interests of both
parties to move forward,”
says Davies.