China pledges $20bn in credit for Africa at summit

China's President Hu Jintao (R) shakes hands with South Africa's President Jacob Zuma during the opening ceremony of the Fifth Ministerial Conference of the Forum on China-Africa Cooperation (FOCAC) at the Great Hall of the People in Beijing, 19 July, 2012Mr Hu called for better co-operation with African countries

China has pledged $20bn (£12.8bn) in credit for Africa over the next three years, in a push for closer ties and increased trade.

President Hu Jintao made the announcement at a summit in Beijing with leaders from 50 African nations.

He said the loans would support infrastructure, agriculture and the development of small businesses.

The Chinese leader also called for better co-operation with African countries on international affairs.

As developing nations, China and countries in Africa should work better together in response to “the big bullying the small, the strong domineering over the weak and the rich oppressing the poor” in international affairs, said Mr Hu.

The loan is double the amount China pledged in a previous three-year period in 2009, since which time China has been Africa’s largest trading partner.

Trade between the two hit a record high of $166bn (£106bn) in 2011, Chinese Commerce Minister Chen Deming wrote in the China Daily newspaper, ahead of the two-day forum.

“We want to continue to enhance our traditional friendship… rule out external interference and enhance mutual understanding and trust,” said Mr Hu.

United Nations Secretary General Ban Ki-moon is also attending the fifth ministerial meeting of the Forum on China-Africa Co-operation.

‘Balanced development’On Wednesday, Mr Hu and Premier Wen Jiabao held bilateral talks with key African leaders, including South African President Jacob Zuma.

Continue reading the main story

China’s top five trading partners in Africa (US$, 2010)

Country Trade value
SOURCE: CHINA CUSTOMS DATA; FRONTIER ADVISORY ANALYSIS
1. Angola $24.8bn
2. South Africa $22.2bn
3. Sudan $8.6bn
4. Nigeria $7.8bn
5. Egypt $7.0bn

Africa is an important source of raw materials to feed China’s economic boom and a market for cheap Chinese products, and has benefited from huge infrastructure projects in return, says the BBC’s Damian Grammaticas.

But there are concerns Beijing turns a blind eye to corruption and claims its firms have committed labour abuses in Zimbabwe, Zambia and elsewhere, our correspondent adds.

Moves by some Chinese enterprises to hire mostly Chinese nationals have also drawn attention.

Mr Wen said that China would now focus on creating jobs for local residents and working with African countries for sustainable growth.

At an economic conference held in conjunction with the summit on Wednesday, he said China would ”expand imports” of African products and ”further open” its domestic market to African countries.

”We need to promote balanced development of trade between China and Africa,” he said.

He also pledged that China would pay more attention to environmental protection and cultural issues in its dealings with the continent.

”As for some existing problems and new situations in China-Africa co-operation, the Chinese government is actively working with African countries to seek effective solutions and measures,” Mr Wen said.

China and Africa's growing trade relationship in figures
19 July 2012

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  •  Rate this comment positivelyRate this comment negatively

    0

    Comment number77.

    Alasdair Campbell
    1 HOUR AGO

    China knows only too well the number of vital raw materials that lie on or under the soil of Africa and this gesture is merely part of China’s grand design to get a handle on these vital assets in furtherance of its strategic ambitions and expansionist policies; together with the creation of a blue water navy to protect the sea routes that will transport these raw materials to their factories.

     

  •  Rate this comment positivelyRate this comment negatively

    0

    Comment number69.

    BluesBerry
    2 HOURS AGO

    President Hu Jintao said loans would support infrastructure, agriculture & the development of small businesses. He also pledged China would pay more attention to environmental protection & cultural issues in its dealings with the continent. Certainly this seems better than what Anglo/American “investment” has done to Africa. Time will tell, but my bet is: China is the better mentor.

     

  •  Rate this comment positivelyRate this comment negatively

    +4

    Comment number52.

    AV8
    2 HOURS AGO

    The African countries are actually wealthy, with vast mineral reserves and natural resources. There is poverty amongst the people, but this is the result of corruption, fueled by Western Aid flowing into the coffers of tin pot dictators and corrupt governments.

    To break the cycle aid should be stopped. The Chinese recognise this and how to exploit the situation for their advantage.

     

  •  Rate this comment positivelyRate this comment negatively

    -1

    Comment number28.

    the_inbetweener
    3 HOURS AGO

    The developed world has tried to support Africa getting on its feet for decades through aid, then China does a business deal admitting somewhat chillingly, that “Africa is an important source of raw materials”.

    China’s ruthless business and human rights record, combined with African corruption doesnt sound like a great combination.

     

  •  Rate this comment positivelyRate this comment negatively

    +5

    Comment number26.

    Samp18
    3 HOURS AGO

    Lot of China bashing again. Its time to wake up, the West no longer own Africa. Europe had over 200 years to resolve the corruption and poor in Africa and all they did was to take the resources and introduced salvery. It’s time to give someone else a go, maybe and it a maybe, China could do a better job in providing a better future for Africa.

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About Uy Do

Banking System Analyst, former NTT data Global Marketing Dept Senior Analyst, Banking System Risk Specialist, HR Specialist
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