Africa has to find the right perspective

 The African nations, led by South Africa, are to be congratulated on their efforts to negotiate better terms of trade and investment with China.

 
The fruits of those negotiations were evident in Chinese President Xi Jinping’s announcement in Joburg on Friday of a solid $60 billion (R860 billion) assistance package for Africa over the next three years.
 
A substantial part of that package will be spent by China on increasing investments in Africa and helping it to industrialise, especially by beneficiating the continent’s raw materials.
 
That would change the fundamental nature of the economic relationship with Africa; moving away from Africa’s heavy dependence on the export of raw materials – and import of Chinese manufactured goods – towards greater African exports of manufactured and value-added products.
 
And that would in turn reduce Africa’s trade deficit with China. This is especially significant for South Africa, as Africa’s most industrialised state, as Trade and Industry Minister Rob Davies pointed out at the Forum on China-Africa Co-operation (Focac).
 
He noted that South Africa’s exports to China dropped 19 percent last year, largely because of a decline in commodity demands caused by the slowing down in Chinese manufacturing as the economy shifts from heavy manufacturing for export towards boosting local consumption.
 
Davies said overall trade with China had dropped just 3 percent, which meant Chinese exports to South Africa grew and so its trade deficit also grew.
 
So South Africa is foremost among its African peers in looking for more Chinese investment, particularly in beneficiating – adding value – to minerals and other commodities.
 
That has already started to happen, for instance with the proposed investment by the Chinese Hebei corporation in processing iron ore in Limpopo to ferro-chrome and the R12 billion investment deal which Davies signed this week with BAIC – the Beijing Automotive Industry Holding Corporation. Davies said this would be the largest automotive investment in South Africa.
 
Davies insisted China was doing South Africa no favours by investing in it as it was also benefiting. He said he had been told by the chief executive of the Hisense TV manufacturing company that its factory in South Africa was its second most profitable one outside China, after the US.
 
That last remark reveals the better attitude. President Jacob Zuma seemed to be putting a slightly different twist on China’s role when he said in his speech at Focac that while Africa’s mineral resources were a blessing, “they have also made Africa vulnerable to exploitation”.
 
“It is for this reason that we want to prioritise beneficiation and value-addition. In that way, what is buried in the belly of our soil will translate into benefit for the bellies of our citizens.”
 
This is very much the essence of the message which Africa has been conveying to China through Focac. And it is, as mentioned, bearing fruit.
 
But it is important for Africa to get the right perspective on this and not depend on China, as it has relied on other external actors to rescue it from poverty and under-development.
 
As Chinese officials and independent analysts pointed out at a Focac round-table conference organised by Independent Newspapers and the Chinese government this week, African countries have to make themselves much more attractive to investors, from China or anywhere else.
 
There are still many strong critics of Chinese investment in Africa as exploitation. This week Tendai Biti, Zimbabwe’s former finance minister, likened Xi’s state visit to Zimbabwe to that of the arch-colonial Cecil John Rhodes to the country in the 19th century because both had come merely to exploit the country’s resources.
 
The “colonial” metaphor is one which Africa too readily resorts to. It reveals much more about Africa than it does about China. What it reveals most is the familiar attitude that the blame for Africa’s predicament lies with others and that they, therefore, have the greater responsibility to put it right.
 
Source : http://www.iol.co.za/

Posted on : 11 Apr,2025 | News Source : ABNews

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