China pledges $20 billion for Africa

Saturday July 28 2012

Chinese President Hu Jintao (L) and Kenya's President Mwai Kibaki attend a welcoming ceremony in Shanghai.  China has said it would offer $20 billion in new loans to Africa

Chinese President Hu Jintao (L) and Kenya's President Mwai Kibaki attend a welcoming ceremony in Shanghai. China has said it would offer $20 billion in new loans to Africa 

By ERIC ODUOR The EastAfrican

China has tightened its economic ties with African countries through a $20 billion credit facility to be utilised over the next three years, and technical support in various fields.

The 5th Ministerial Conference of the Forum on China-Africa Co-operation (FOCAC) adopted two documents — the Beijing Declaration and the Beijing Action Plan — that spell out the political and economic areas in which to strengthen ties between the two parties.

The Beijing Declaration outlines political interests between China and Africa, while the Beijing Action Plan stipulates socio-economic areas to be implemented over the next three years.

The Action Plan states that Chinese companies operating in African countries should adhere to activities that will ensure sustainable development and mutual benefit.

Chinese companies are required to promote technology transfer, value addition to African products, environmental protection, social responsibility and respect for African culture, traditions and laws.

Opening the two-day forum on July 19 in Beijing, Chinese President Hu Jintao said China and African countries are keen to strengthen South-South relations for the benefit of their citizens.

The three-year strategic plan focuses on education, health, water, human resource development, research, infrastructure, tourism, media, investment, manufacturing and agriculture.

African governments are required to state the projects of their choice for implementation over the next five year years.

President Hu said African countries will also benefit from scholarships and youth and academic exchange programmes with China.

Under the new plan, the Chinese government has pledged to waive tariffs on up to 95 per cent of goods from Africa to its market, as a means of balancing trade.

According to statistics released by the country’s Foreign Affairs Ministry, the volume of trade from Africa to China hit $95 billion last year.

Volume of trade from China to Africa was $160 billion in the same period. The Chinese government said waiving tariffs on African goods will reduce the gap in trade.

The director general of African affairs in the Foreign Affairs Ministry, Lu Shaye, said after consultations with African leaders, the Chinese government decided to develop strategies that will make the co-operation a win-win situation.

Before FOCAC, the Chinese government hosted representatives of non-governmental organisations, civil society and the media.

The meeting came up with proposals to bring on board non-state actors in China-Africa dealings. If adopted, NGOs in Africa will receive funds and capacity support from the Chinese government through the China NGO network for international exchange.

However, China is grappling with criticism of low standard goods that find their way into the African market.

During the FOCAC meeting, the government pledged to crack down on low quality goods to improve credibility of its products on the international market.

The Chinese government pledged to boost the capacity of custom departments of African countries to impound counterfeit goods at the point of entry.

During the conference, South Africa’s President Jacob Zuma took over co-chairmanship of FOCAC from Egypt.

In his speech, Zuma said co-operation between China and Africa is mutual, and called on FOCAC to expedite various development plans by African countries.

He said during the just concluded African Union Summit, priority projects were identified to promote stability and integration of the continent, and called on FOCAC to support their implementation.

Kenya’s Prime Minister Raila Odinga led the Kenyan delegation during a closed door meeting at China World Hotel to push for the country’s development agenda.

Members of the Kenyan delegation included Cabinet ministers Njeru Githae, Amos Kimunya, Fred Gumo and Noah Wekesa, and other senior government officials.