Page 2 of 2 Africa seeks lessons in
Shanghai By Zhou Jiangong
commitment made by Hu at the
Beijing forum last year. China has promised to
extend preferential loans of billions of dollars
to African countries. China's US$5 billion African
Development Fund is ready to be launched.
On Thursday, Zhou Xiaochuan, governor of
the People's Bank of China, the country's central
bank, spoke highly of the new achievements in
China-Africa ties since November.
China
has been working hard to strengthen cooperation in many
areas with the implementation
of aid and assistance measures, Zhou said.
China has in the primary stage selected 30
programs in 20 African countries as preferential
loan receivers and has signed preferential loan
agreements with Chad, Cameroon and Mozambique. In
addition, Namibia has been granted $100 million of
preferential export buyer's credit.
The
China-Africa development fund has been approved by
the Chinese government, with $1 billion covered
during the first phase, $3 billion during the
second phase and $5 billion in the end.
The fund, set up to encourage Chinese
companies to invest in Africa and provide support
to them, will be operated by professional fund
managers according to market rules, and relative
procedures will soon be produced.
China
has signed agreements with 11 African countries to
cancel their debts worth 10.9 billion yuan ($1.4
billion), and will handle debt-canceling
formalities with another 22 countries in 2007.
Zhou said China will take measures to
promote financial collaboration with Africa. The
measures include encouraging Chinese enterprises
to expand investment in Africa and Chinese
financial institutions to open branches and
representative offices on the continent.
According to Zhou, African financial
institutions are also welcome to set up branches
and representative offices in China.
This
week Gao Jian, vice governor of the China
Development Bank, said the CDB attaches great
importance to cooperation with African nations. It
has dispatched eight working teams to the
continent and will dispatch another 18 teams this
year.
Li Ruogu, governor of the Import and
Export Bank of China, said Exim Bank has operated
projects with all African nations that have
established diplomatic relations with China. In
the coming three years, the bank will inject $20
billion into these projects.
"Improving
financial collaboration between Asia and Africa is
crucial for both parties in a globalized world,"
said Zhou, who is also the chairman of the board
of governors of AfDB Group. "China is willing to
play a more active role in promoting cooperation."
Finance is a crucial area in China-Africa
economic cooperation, said Kaberuka. Currently,
China is increasing investment in Africa and
exploring new channels for financial cooperation
with African nations.
Welcoming the moves,
African countries now look forward to China's help
in expanding "home-grown development", no longer
content with the primitive growth mode of relying
on exports of oil and raw materials, most of which
are bought by China.
"For the moment, the
balance of trade is in our favor. But I also feel
that a lot of Chinese investments are concentrated
on resource industries, such as oil and gas; we
would like to expand the partnership in other
fields as well. There are other forms of
imbalance, especially in the trade relationship,
we would like to address," Kaberuka told China
Business News, a leading business newspaper based
in Shanghai.
"And we are appealing to the
partners of Africa to come for the opportunities
not just in oil, gas, and mining, but also in
other opportunities, because I think this is the
time."
African countries are getting more
and more impatient and uneasy with extracting
resources, cutting timber, and exporting cotton.
The main challenge is to develop value-added
industrial production and start climbing on the
value chain so that employment can be created and
value left inside Africa.
From SANE (South
Africa, Algeria, Nigeria, Egypt) to Angola, all
economic engines in Africa are busy converting
resources windfall to investment in infrastructure
necessary to nurture the private sector - an
experience they have learned from China and other
Asian countries.
"China brings in new
knowledge, new financial capital and a new model
of development," said Louka T Katseli, director of
the OECD's Development Center.
African
countries need to finance infrastructure
construction, they need cheap technologies, they
need development know-how, and they need
investment in manufacturing industries that are
suitable to their conditions. All those can come
from China.
They are in a race against
time. They have to establish a platform for
launching manufacturing before the raw-material
boom turns to commodity bust.
"You may
delay, but time will not," reads a quote from
Benjamin Franklin on the flyer.
Zhou
Jiangong is a Shanghai-based analyst on
China's economic, political and foreign affairs.
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