China Pledges $20bn in Loans to Africa
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In a bid to strengthen ties and mutual cooperation, China has promised $20 billion in credit for Africa over the next three years. The loan is double the amount China pledged in a three-year period in 2009, since which time China has become Africa’s largest trading partner.
Chinese president Hu Jintao had made the announcement at a summit in Beijing yesterday, where leaders from 50 African nations were in attendance.
In a bid to strengthen ties and mutual cooperation, China has promised $20 billion in credit for Africa over the next three years. The loan is double the amount China pledged in a three-year period in 2009, since which time China has become Africa’s largest trading partner.
Chinese president Hu Jintao had made the announcement at a summit in Beijing yesterday, where leaders from 50 African nations were in attendance.
Calling for greater co-operation, the Hu also said that developing countries need to work together to stand up against the “big bullying the small, and the strong domineering over the weak, and the rich oppressing the poor”.
China’s trade with Africa reached a record high of $166.3 billion in 2011, according to Chinese statistics. In the past decade, African exports to China rose to $93.2 billion from $5.6 billion.
Africa is an important source of raw materials to feed China’s economic boom, and a huge market for cheap Chinese exports.
In return, African nations have benefitted from huge infrastructure projects. The Industrial and Commercial Bank of China, for instance, the world’s most valuable lender, has invested more than $7 billion in various projects across the continent.
Speaking at the forum, South African President Jacob Zuma said:
[quote] Africa’s past economic experience with Europe dictates a need to be cautious when entering into partnerships with other countries. We are particularly pleased that in our relationship with China we are equals and that agreements are entered into are for mutual gain. We certainly are convinced that China’s intention is different to that of Europe, which to date continues to intend to influence African countries for their sole benefit. [/quote]
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However, the European Union has rejected what they brand as China’s “cheque book” approach to doing business with Africa, as there are concerns that China turns a blind eye to rampant corruption and human rights abuses in Zimbabwe, Equatorial Guinea, and elsewhere.
At the same time, Reuters reports that “Chinese state-owned firms in Africa also face criticism for using imported labour to build government-financed projects like roads and hospitals, while pumping out raw resources and processing them in China, leaving little for local economies.”
Speaking at the same event, Chinese premier Wen Jiabao said that the focus now would be to create jobs for local residents and to create sustainable growth for African economies.
Wen said:
[quote] We need to promote balanced development of trade between China and Africa. [/quote]Related News: Africa To Receive $3.5 Billion Investment From IFC In 2012
