Zuma warns on Africa’s trade ties to China


Chinese Premier Wen Jiabao, right, shakes hands with South African President Jacob Zuma at the Hall of Purple Light inside the Zhongnanhai compound in Beijing, China, on July 19, 2012. (Reuters)
July 19, 2012

South African President Jacob Zuma warned Thursday that the unbalanced nature of Africa’s burgeoning trade ties with China is “unsustainable” in the long term.

The South African leader was addressing the China-Africa Forum in Beijing just after China’s president pledged $20 billion in loans to Africa, doubling the amount Beijing agreed to give the continent three years ago at the same forum.

“Africa’s commitment to China’s development has been demonstrated by supply of raw materials, other products and technology transfer,” Zuma said. “This trade pattern is unsustainable in the long term. Africa’s past economic experience with Europe dictates a need to be cautious when entering into partnerships with other economies.”

Zuma appeared to be referring to the concerns of some African nations about the unbalanced nature of the trade relationship. Two-way trade between China and Africa hit $166 billion last year, with a trade surplus in Africa’s favor due to exports of raw materials such as crude oil and copper. China is a major exporter of cheap manufactured goods to Africa, such as electronics and clothes.

Critics have accused China of taking a neo-colonialist approach to the continent and of exploiting Africa’s natural resources. Many African nations want China to import more than just resources.

China sees Africa as a strategic ally and has pushed for expanded African roles at the United Nations, while encouraging Chinese infrastructure and resources companies to invest in the continent.

China’s investment in Africa — estimated at $15 billion over the past decade — is growing rapidly, and Chinese companies are building infrastructure across the continent, from dams and airports to mines and wind farms. On Wednesday, Nigeria announced the signing of a $1.5 billion railroad project to be built by the state-owned China Civil Engineering Construction Corp.

While he hinted at potential long-term trade issues, Zuma spent much of his speech, which was made in the presence of Hu Jintao, China’s president, praising China’s “steadfast” commitment to Africa. That commitment, he said, “has already been demonstrated with concrete and tangible results particularly in terms of human resources development, debt relief and investment.”

The two nations have close ties, and South Africa joined the “BRIC” group of developing countries — Brazil, Russia, India and China — last year. South Africa has also attracted significant Chinese investment as it seeks to market itself as the gateway to other African countries.

China introduced several measures this week to help rebalance trade ties, including zero tariffs for an expanded range of African products. Beijing also pledged to hold more trade expos to display African merchandise.

Although Chinese companies have invested heavily in Africa, they have not always had a smooth experience. One of the low points came in 2010 when a Chinese mining boss in Zambia shot nearly a dozen local miners during a riot.

Chinese companies have also been caught up in the recent maelstrom of political changes in North Africa, with more than $4 billion worth of projects suspended in Libya after the fall of Moammar Gaddafi and the kidnapping of 29 Chinese workers in Sudan earlier this year.

The triennial China-Africa Forum hosts heads of state and ministers from more than 40 African countries and is a “pageant of China-Africa friendship and unity,” as one Chinese state-run paper put it.

In addition to the $20 billion loan commitment over the next three years, China also vowed to focus on cooperation in agriculture, infrastructure, cultural exchanges and more scholarships for African students to study in China. Chinese scholars say China’s aid to Africa is not mercenary, but instead motivated by historic ties.

“China regained its seat in the United Nations with the help of African countries,” said Zhang Haibin, an Africa expert at the Shanghai Institute for African Studies. “We cannot forget our old friends.”

That certainly seemed to be the case on Thursday, judging from the pomp and ceremony on display at the Great Hall of the People in Beijing. The normally stoic Hu was effusive in his welcoming speech to the forum Thursday morning.

“Forever we will be the good friends, partners and brothers of Africa,” he said. “We deeply thank the men and women of Africa for their support of China in its development.”

Gwen Chen in Beijing and Andrew England in Johannesburg contributed to this report.

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