Closer Sino-African partnership for win-win results
Dec. 01, 2021
Peking University, Decemebr 1, 2021: The two-day Eighth Ministerial Conference of the Forum on China-Africa
Cooperation, which concluded on Tuesday, reviewed the FOCAC's
achievements since its establishment in 2000 and vowed to take
China-Africa cooperation to a higher level in accordance with the theme
of the conference, "Deepen China-Africa Partnership and Promote
Sustainable Development to Build a China-Africa Community with a Shared
Future in the New Era".
A key task of the conference was to dock China's Long-Range Objectives
Through the Year 2035 and the "dual circulation "development paradigm
with the African Union's Agenda 2063 so the two sides can more
effectively tap into each other's economic complementarity and further
strengthen their win-win cooperation, in order to improve people's
well-being.
China committed to helping Africa
That China is committed to helping Africa meet the challenges it faces
was once again confirmed by President Xi Jinping on Monday. In his
speech at the opening ceremony of the conference, President Xi said that
apart from helping Africa fight the novel coronavirus and making sure
African countries have access to enough affordable vaccines, China will
also make efforts to increase trade and investment, share its experience
in poverty alleviation, deepen cooperation on the digital economy,
promote green, low-carbon development, and help develop renewable
energy.
Data from the Ministry of Commerce show that China's direct investment
in Africa has increased by more than 25 percent a year since the
establishment of the FOCAC. By the end of 2020, China's direct
investment in Africa had exceeded $43.4 billion, covering more than 50
African countries, and Chinese enterprises had helped establish 25
special economic zones or industrial parks in Africa, which contributed
about $1.47 billion in taxes to the host countries and created more than
42,000 local jobs.
China has scaled up assistance to African countries since the 18th
National Congress of the Communist Party of China in 2012. For example,
foreign aid from 2013 to 2018 totaled 270 billion yuan ($42.26 billion),
45 percent of which was in the form of grants, interest-free loans or
concessional loans.
From 2000 to 2020, China helped African countries to build 13,000
kilometers of expressways and railways, and more than 80 other
large-scale infrastructure facilities, and funded over 130 medical
establishments, 45 sports venues and 170 schools. It also helped train
over 160,000 personnel from Africa, and built a series of flagship
projects including the African Union's new headquarters with a huge
Conference Center in Addis Ababa, Ethiopia.
But since the 2018 FOCAC Summit in Beijing, the world has encountered
three new challenges, and Africa seems to be particularly vulnerable to
them.
The COVID-19 pandemic has had a huge impact on the global economy.
According to the African Development Bank, Africa's GDP contracted by
2.1 percent in 2020 due to the pandemic, and its projected growth in
2021 will be lower than that in other regions. And according to the
World Bank, the pandemic is estimated to push an additional 29 million
Africans into extreme poverty by the end of 2021.
The pandemic and the continued trade frictions among some major
economies have also disrupted global supply chains and obstructed global
economic integration. Since the major trading hubs are largely
concentrated in North America, Europe and East Asia, many African
countries are marginalized and tend to lose the benefits of global
economic integration.
More important, even though 592 million people in Africa do not have
access to electricity, African countries have committed to joining the
international community in taking climate action to limit global
temperature rise to below 1.5 degrees Celsius. This means African
countries have to provide affordable clean energy to the people as well
as address climate change that has increased the frequency of extreme
weather events.
According to ancient Chinese philosophy, opportunities can arise even
from crises. This holds true for the future of China-Africa cooperation.
To begin with, the pandemic has not undermined Chinese investors'
enthusiasm to invest in Africa. Despite the challenges and difficulties
posed by the pandemic, the Nigerian Rye Railway－built by China Civil
Engineering Construction Company－started commercial operations on June
10. It is the first modern double-track standard gauge railway in West
Africa, and the longest double-track standard gauge railway in Africa.
As one of the biggest sources of foreign direct investment in Africa,
China will continue to play a key role in its industrialization and
economic transformation, and adopt a market-oriented
"infrastructure-plus-manufacturing-plus-services" investment model.
Under this model, Chinese enterprises will team up with local partners
to expand manufacturing and services capacity in special economic zones
and/or industrial parks. Such a coordinated approach will require
investments in infrastructure projects given the market potential of
both the manufacturing and service industries.
By the same token, investors in manufacturing and service projects need
to ensure that power supply is undisrupted, transportation capacity is
adequate and the industrial supply chain is functioning smoothly. In the
short term, since the pandemic is still raging in many countries,
Chinese enterprises should help African countries increase their vaccine
production capacity through joint licensed production and technology
transfer. Such an arrangement would provide African people with safe,
effective, high-quality and affordable vaccines.
Africa's new free trade deal can boost its economy
While the pandemic has intensified the opposition against globalization
in some countries, African countries have consolidated their unity more
than ever with the creation of a single market under the African
Continental Free Trade Area agreement. The agreement connects 1.3
billion people across Africa and adds momentum to the $3.4 trillion
African economy.
In particular, the ACFTA has created new cooperation opportunities in
the digital economy, which will improve Africa's connectivity with the
rest of the world. In this regard, Chinese enterprises can share with
African countries their experience of digital technology and help
increase the exports of African goods.
In fact, Chinese internet giant Tencent recently invested in Ozow, a
South African online payment and e-commerce platform, in a bid to expand
its operations in other African countries. Alibaba, another major
Chinese information and communications technology company, entered the
African market even earlier, in 2018, when it signed an agreement with
the Rwandan government to launch the Electronic World Trade Platform,
which made Rwanda the first African country to allow small and
medium-sized enterprises to participate in cross-border electronic
commerce.
Aside from the big players, many smaller Chinese companies have also
entered the African e-commerce market including Buffalo in South Africa
(a cross-border logistics platform) and Kilimall in Kenya (a one-stop
global online trading service platform integrating trade, payment and
distribution of goods).
Although Africa faces a serious power deficit, as 44 percent of its
population has no access to electricity, the annual average solar power
capacity in most African countries is 2,000-3,000 kilowatt-hour/square
meters, making the continent the region the most abundant in solar
energy. Therefore, harnessing solar energy is an effective way to not
only reduce the power deficit but also propel low-carbon development.
China has already announced that it will no longer support new
coal-fired power projects abroad, which means China is likely to provide
more funding for renewable energy projects in Africa, which will help
the two sides to meet the dual challenge of generating energy and
fighting climate change.
In addition to large-scale solar photovoltaic projects, there is also
huge potential for small-scale off-grid solar PV projects to supply
power to remote areas and islands in Africa. Since 2018, StarTimes, a
Chinese media company and technology provider, has been engaged in
small-scale off-grid solar PV projects in Kenya, Zambia, Uganda,
Tanzania and Rwanda, which have improved the living standards of local
residents.
Moreover, it should also be emphasized that China-Africa cooperation is
not exclusive in nature. Third-party cooperation in Africa, whether by
developed countries or international organizations, is welcome, as long
as it creates more win-win results for the benefit of people in Africa
and beyond.
The author is Yu Jia,
director of International Development Cooperation Department, Institute
of New Structural Economics, Peking University.
Source: China Daily
