China to raise Africa investment
2009-11-07 20:07
Egypt - China will increase investment in and aid to African countries despite the effects of the global economic crisis, according to draft agreements to be signed at a summit in Egypt on Sunday.
The summit comes as Chinese appetite for raw materials, especially oil and minerals, helps drive growth in Africa.
Chinese Premier Wen Jiabao will meet African leaders in the Egyptian resort of Sharm El-Sheikh, the highest level of contact between the two sides since Chinese President Hu Jintao pledged $5bn in loans to Africa at a summit in Beijing in 2006.
"Despite its own difficulties caused by the impact of the global financial crisis, China expressed commitment to further scaling up assistance to Africa," reads a draft action plan to be agreed by the two sides, a copy of which was obtained by Reuters.
While China has been coy about exactly how much more aid it will provide, Beijing is keen to show its interest in Africa goes beyond simply extracting natural resources.
"In the next three years, the Chinese side will continue to provide preferential loans to African countries, which will be used mainly to support infrastructure and social development projects."
"China will continue to co-operate with Africa ... and try to raise the added value of the energy and resources products of African countries and enhance their capacity for intensive processing," reads the draft plan.
The draft said the Chinese side promised to further open its market to African countries. More African goods would be able to be exported to China tariff-free.
Trade between China and Africa has jumped in the past decade, driven by China's resource needs and growing African demand for cheap Chinese-made products.
In 2008, total trade was $106.8bn, up 45.1% on 2007.
In 2000, trade was only $10.5bn. China's imports from Africa were $56bn in 2008, and its exports to African states, including both sub-Saharan and North Africa, were $50.8bn.
Yet China's imports from Africa are dominated by oil and mineral shipments from a handful of countries: Angola, Sudan, Nigeria, Zambia, the Democratic Republic of the Congo and its smaller neighbour, the Republic of the Congo.