The Strategic Building of the Sino-African Relations

February 1, 2016Economic Relationsby Jeremy Riro

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Sino-African relations are blossoming as part of a strategic plan.

That Africa is becoming pro-China in terms of trade and economic ties is no longer a boardroom discussion but rather a strategically executed plan in the public domain. The growth in the Sino-African relations is evident by the rise in trade volumes between the two partners from US$10 billion in 2000 to about US$198 billion in 2012. A white paper released by the Chinese government in 2015 shows that the trade volumes between the two partners are projected to reach about US$220 billion in 2014. Today, China is the leading trade partner with Africa.

The blossoming Sino-African relations however did not just emerge from the blues and flourished without tender care and nurturing. The journey has taken more than a decade of strategic positioning and calculated cooperation between China and Africa for the current trade ties to be established. It all dates back to October 2000 when the first Ministerial Conference on Forum on China–Africa Cooperation (FOCAC) was held in Beijing, China. Attended by about 44 representatives from Africa and 80 ministers from China, the output of the conference set the beginning of the growing trade ties today. Two important outcomes from the conference were the passing of the “Beijing Declaration of the Forum on China–Africa Cooperation” and the “Programme for China–Africa Cooperation in Economic and Social Development”.

Later on in December 2003, the Chinese government sent about 70 ministers to represent it in the second Ministerial Conference in Addis Ababa, Ethiopia. In attendance we had about 44 representatives from African countries; in a conference that passed the “Addis Ababa Action Plan (2004–2006)”.This action plan set the stage for the first FOCAC Summit in 2006 that was held in Beijing, China.

During the first FOCAC Summit attended by about 35 heads of state from Africa, the Chinese government announced a US$5 billion concessionary loan to Africa. The loan was meant to cement trade cooperation between the two partners in infrastructure development, agriculture technology among other support in strategic development sectors. In the same summit, the China-Africa Development Fund (CAD Fund) was announced and later launched in June 2007. The fund received its initial funding of US$1 billion from the China Development Bank with a vision of growing it to US$5 billion in the future.  The objectives of setting up this fund were to scout for and increase investment opportunities between China and Africa as well as transfer of financial and managerial advice.

Having set the pace in 2006, the Chinese government continued to strengthen its presence in Africa’s economic narrative by further announcing a US$10 billion additional concessionary loan to Africa in the 4th Ministerial Conference held in Egypt in 2009. In addition, another fund was set up in the same year targeting SMEs in Africa with initial funding of US$1 billion. These two were among other development cooperation deals that were discussed in the conference including projects in clean energy, scientific and technological research, agricultural technology and cooperation in the medical sector.

The Africa-China formal relationship celebrated its 12th anniversary through a Ministerial Conference held in Beijing in July 2012. This was then followed by the second FOCAC Summit held in Johannesburg, South Africa in December 2015. Today, it is estimate that about 1 million Chinese live in Africa with about 200,000 Africans living in China. Moreover, the Chinese government continues to increase its trade cooperation with individual African countries as it seeks to establish itself as the next global economic super power.

At the continental level, China’s commitment and determination to strengthen the Sino-Africa relationship was demonstrated through its funding (which was a gift) towards the construction of the African Union headquarters in Addis Ababa. Any time the African heads of states sit in this building, it will be a constant reminder of their long-term relationship with China; and it will forever be the symbol of China’s presence and dominance in Africa’ s economic, political and even military spheres. It is therefore not a shocker that most African heads of state today are turning their eyes to the East; while maintaining short strategic glimpses to the West to maintain cordially opportunistic relationships.