ChinAfrica (1) - watching China Spread it's lacquer over Africa

Africa Exports to China Grow

By Isabel Goncalves
Posted 03 August 2006 @ 11:44 pm EST


africa china trade Trade between China, the fastest growing
economy in the world, and Africa had amounted to $40 billion by the
end of 2005, which is ten times higher than in 1995, according to the
bank.

This sharp rise in trade occurred after China omitted tariffs on 190
imported goods from 28 of Africa's least developed countries.

While African exports to China consist of oil, timber and cotton,
China's exports to Africa comprise mainly machinery, electronics,
textiles and hi-tech products

South Africa is China's key trade partner in Africa. It constitutes
to 20.8 percent of the total volume of China-Africa trade. According
to South Africa's Department of Trade and Industry, China has
established more than 80 companies in South Africa since 1998.

Total China-Africa trade reached about $29.5 billion in 2004, an
increase of 59 percent over 2003. Growth since 2001 has increased at
an average of 31.2 percent a year, according to a statement by South
Africa's government.

Meanwhile, Africa's trade deficit with China has decreased from $2
billion in 2004 to a surplus of $900 million in 2005.

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http://www.ibtimes.com/articles/20060808/china-africa-trade.htm

Africa, China Bonds Have Mutual Benefits

By Terry Leonard
Posted 08 August 2006 @ 02:10 pm EST


Zimbabwe President Robert Mugabe, under targeted sanctions by most
Western governments because of his country's human rights record and
its retreat from the rule of law, has declared a "Look East" policy.

China, hungry for energy and raw materials as its economy expands,
has invested heavily in Africa. At the same time, it has offered
limited political and economic help to repressive governments in
Africa. Western governments are more likely to tie engagement to
political and social reform, though they, too, have a history of
backing African dictators.

Africa is also a battleground in China's rivalry with Taiwan. Chad
recently ended ties with Taiwan and resumed diplomatic relations with
China after a break of nearly a decade.

Bilateral trade between China and Africa has increased more than 300
percent since 2000 and now exceeds $40 billion a year.

"There is a potential of political leverage for China. The West is
worried about growing Chinese influence. But the political effect so
far is less than might have been imagined," said Stephen Friedman, a
senior research fellow at the Center for Policy Studies in
Johannesburg.

"The argument is that they have helped Mugabe. But they haven't much.
It has been more of a symbolic gesture."

But Friedman said repressive and corrupt governments may nonetheless
increasingly turn to China for economic development and political
cover.

Chinese Premier Wen Jiabao, on a visit to South Africa in June,
insisted China's interest in Africa was based on mutual respect, and
that both sides would benefit.

"We respect the social system and development strategy pursued by
African countries in light of their particular national conditions,"
Wen said in a speech during his visit. "We do not seek to export our
own values and development models."

"We respect the principle of equality, mutual benefit and
noninterference in other's affairs," he told reporters at another
stop on his South African tour.

China is now the largest exporter of oil from Angola. It also exports
oil from Sudan, without condemning that government for the killing in
the Darfur region that the United States has labeled genocide.

At the United Nations last September, China worked to dilute a
resolution condemning Sudan for the killings in Darfur.

China has come to Africa seeking oil and raw materials, such as
Zambian copper, and to make investments that include such big ticket
items as roads and refineries, usually built with Chinese labor.

The Chinese "never make any pretense that they are anything other
than hard nosed and want to take away a profit," said John Robertson,
an independent economist in Harare. "My biggest fear is that Zimbabwe
has become so weakened that at some stage the Chinese can say, 'We
can bail you out,' and in exchange we not only will repay money but
sell their products in the region.

"In other words, we will be come the tool that wipes out the
clothing, footwear and textile industries for the whole of Southern
Africa, and the Chinese will have the market to themselves," said
Robertson.

At the level of the working man, China _ and especially imported
Chinese workers _ are seen as a threat to already meager livelihoods.
In Zambia, local workers have rioted to protest the Chinese.

Chinese companies have been accused of flooding Nigerian markets with
fake and substandard goods, notably textiles. In December, Nigerian
officials took the dramatic step of shutting down several shopping
centers run by Chinese traders in the commercial capital, Lagos.

Even in South Africa, the richest country on the continent, unions
fearful of a loss of jobs, especially in the clothing and textile
industries, are pressing the government to re-negotiate trade
agreements with China they believe are advantageous to the Chinese.

South African imports from China exceeded $4.4 billion in 2005
compared with $1 billion in exports, according to government figures.

South African firms _ from mining giant Anglo American to Internet
service providers and beer brewers _ have invested some $400 million
in China, according to government figures. China has put about $130
million in South Africa, most in a chromium mine.

In Angola, where most people live in extreme poverty, Prime Minister
Fernando Da Piedade Das Dos Santos last week had to respond to rumors
that he had authorized the immigration of 4 million Chinese workers
into Angola.

"The Chinese are coming to Angola within specific projects and after
those projects come to an end they will return to their country," he
said without confirming or denying the rumored figure.

In Zimbabwe, "Look East" has generated deep resentment of the
Chinese, said John Makumbe, a political analyst at Zimbabwe
University and a critic of Mugabe's policy.

But Friedman believes despite any resentment in the streets, corrupt
and repressive African governments who have nowhere else to turn will
look to China for political legitimacy and protection. Even if China
has offered little political help so far, it presents itself as a
leader of the Third World.

Democratic governments in Africa will look toward China because their
businessmen will be pressing for access to China's huge market
potential.

Friedman said China believes its investment in Africa, beyond
bringing it the energy and raw materials for expansion, also has the
potential of creating a windfall profit in geopolitical influence in
the future.

"The West is very worried about China's involvement in Africa," said
Friedman. "Seeing a new superpower emerging is making it very
uncomfortable."