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AFRICAN ECHO NEWS

China Africa’s New“Friend”?

Beijing - China's Premier Wen Jiabao sets is inAfrica to woo key African nations on, including the country's second-largest oil supplier, Angola. But Beijing's growing economic power may mean his welcome is tempered by resentment.

Thirsty for oil and raw materials, China has poured billions into African countries blessed with mineral wealth, building on a legacy of goodwill from its support of independence movements in the 1960s and 1970s.

Nearly one-third of the country's crude imports already come from Africa, and Angola was second only to Saudi Arabia in supplying China over the first four months of the year.

"Africa is hugely important. The Middle East is largely about buying oil, while in Africa it is also about investing in assets," said Gavin Thompson, China manager at energy and life sciences consulting firm Wood Mackenzie.
Building on past tours by President Hu Jintao and foreign minister Li Zhaoxing in what one Chinese official has dubbed an "African year", Wen's itinerary will include Egypt, Ghana, South Africa, Angola, Uganda and Tanzania between June 17 and 24.

Closer than Latin America, in need of more technical help than Middle Eastern nations and possessing key mineral deposits left undisturbed for years because of war or civil strife, the continent offers a perfect hunting ground for China's majors.

Investment is bearing fruit. Booming crude and commodity markets should help push African growth to a 30-year high of 5.8 percent this year, the International Monetary Fund said in April.

But resentment has begun to build that the bounty of cheap manufactured goods China sends in return for raw materials is damaging industries and stunting Africa's development.

Complaints are starting to echo through Africa as the cut-price power of China's manufacturing sector hits home.

Nigeria's Textile, Garments and Tailoring Senior Staff Association estimates that 1.8 million jobs were lost over five years due to Chinese competition.

Western nations and rights groups fret that China exports guns and environmental destruction to Africa, along with cheap textiles, and that Beijing is ready to do business with nations the West wants to pressure into better governance.

On the other hand, some Africans are sanguine about the cost of growth on a continent that western investors often write off as too risky.

"Beijing has a very pragmatic stance, aimed at securing supply chains of commodities, resources and energy assets, as well as market space for Chinese products," said Martyn Davies of the Centre for Chinese Studies at Stellenbosch University.

"If China is the reason African economies are growing at 5 percent or more, it seems like a good thing to me."

Angola last month awarded state-owned Sinopec a 40 percent stake in its lucrative offshore oil Block 18, after the firm proposed a $1.1 billion (R7.5 billion) government signature bonus - out of total investment of more than $1.4 billion. It also won a 25.5 percent stake in Block 17, but shocked other firms with its ruthless bid. – Reuters

 

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