Economy

China makes $20 billion credit pledge to Africa

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Will also increase assistance by building agricultural technology demonstration centres

China will provide $20 billion in credit to African countries over the next three years, doubling its earlier loan commitment in a move to strengthen fast deepening economic ties with the continent amid political uncertainties.

President Hu Jintao announced the credit pledge while addressing a gathering of heads of state and representatives from 50 African countries here on Thursday, at the opening session of the fifth Forum on China-Africa Cooperation (FOCAC). China had pledged $10 billion in soft loans at the previous China-Africa summit in 2009.

Reflecting fast-growing economic ties — trade between China and Africa rose to $166.3 billion last year, up by 83 per cent from 2009 — Mr. Hu announced the opening of a $20 billion credit line to assist African countries in developing infrastructure, agriculture, manufacturing and small and medium enterprises. He said China would also increase assistance by building agricultural technology demonstration centres, training 30,000 personnel and offering 18,000 scholarships.

In an indication of the new challenges facing China’s growing ties with Africa, leaders of a number of African countries have, this week, reiterated the need for a trade relationship driven by Chinese hunger for natural resources to evolve into deeper ties. South African President Jacob Zuma warned, on Thursday, that the trade pattern was “unsustainable in the long-term”, though he also had praise for China’s template of engaging with Africa amid Western criticism.

“Africa’s past economic experience with Europe dictates a need to be cautious when entering into partnerships with other countries,” Mr. Zuma was quoted as saying by Reuters. “We are particularly pleased that in our relationship with China we are equals and that agreements entered into are for mutual gain. We certainly are convinced that China’s intention is different to that of Europe, which to-date continues to intend to influence African countries for their sole benefit.”

Chinese officials, on Thursday, also spoke of the challenges of maintaining stable ties amid sweeping political changes in the continent, with unrest in North Africa and instability in several other countries.

Zhong Weiyun, a senior official in the Communist Party of China’s (CPC) International Department who is involved in both policy-making and driving party-to-party ties with African countries, spoke of the surprise in China at the Arab Spring unrest. He noted that the CPC had “very good relations” with the ruling governments in Egypt and Tunisia before they were ousted. After “the dramatic political changes,” he said, the CPC had sent working groups to establish ties with the “great number of new parties that have emerged.”

He also spoke of the need to maintain strong political relationships, referring to recent elections in Zambia where a party that was critical of engagement with China came to power. He said the CPC had organised several exchanges after the election and was “successful in improving relations”.

While the FOCAC meeting has focused largely on driving trade, giving less attention to more controversial issues such as the cases of abuse of workers on some Chinese projects in Africa and safety concerns voiced by Chinese companies, officials said they had called on Chinese companies to pay more attention to “social responsibilities”.

At a meeting on Thursday between entrepreneurs and enterprises from China and Africa that saw $500 million worth of documents signed, a declaration called on Chinese companies to “safeguard vital interests of the two sides in a spirit of equality and mutual benefit”. Yu Ping, Vice-Chairman of the China Council for Promotion of International Trade, told reporters that Chinese companies had been told to “uniformly recognise the content and scope of social responsibilities”, and to also better publicise the good work they were doing to counter “misleading reports from the West that are not fully consistent with actual reality”.

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Printable version | Dec 11, 2019 5:28:52 AM | https://www.thehindu.com/business/Economy/china-makes-20-billion-credit-pledge-to-africa/article3658483.ece

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