Chinese firms have 'key role' in Africa
Chinese companies have a key role in ensuring sustainable development in Africa and helping its economies tackle challenges such as limited export opportunities, weak infrastructure and unemployment, business executives from China and Africa said on Tuesday.
Buoyed by Africa's ability to provide new markets and sustain growth, more of those companies are opening new businesses and utilizing cooperative models across the continent. They are attracted by Africa's boom in consumption upgrades and new policies to build modern manufacturing and transportation systems.
Justin Yifu Lin, former chief economist and senior vice-president of the World Bank, said industrialization and modern agriculture will get a major boost in Africa from the growing presence of Chinese companies. The companies' experience in Africa also will help them in their quest to move up the value chain and build a bigger platform for bilateral collaboration.
Though many African countries have gained confidence through rapid economic growth, Lin said many still confront uncertainties due to their economic background and the challenges of having a singular economic structure.
It is not uncommon to see African nations that are excessively reliant on exports of agricultural and natural resources such as grains, tea, copper, oil and timber. It is ironic that these nations do not have a say in the pricing process, said Yewande Sadiku, CEO of the Nigerian Investment Promotion Commission.
"Even though Africa has abundant natural resources, including crude oil and minerals and agricultural products, we have our own problems," said Caroline Kariuki, CEO of the Kenya Private Sector Alliance. "The export of African products-about 70 percent of them-are raw materials and cannot make much profit.
"Therefore, Africa needs a good supply chain to produce some value-added products, not just oil or gas or agricultural products, rather than just being a shipper of raw materials to different foreign destinations. If we can reach these goals with the participation of Chinese companies, we can build a quality economic development foundation and notably improve people's income."
With China-Africa trade cooperation moving into the next phase, there will be a significant scope for diversification of African economies and exports in the long run, particularly in manufacturing and agriculture, said Khalil Laabidi, president of the Tunisia Investment Authority.
In addition to goods, Chinese business executives said trade in services also has room to grow in Africa because many countries there lack proper tourism service facilities, airports and airline services.
"To further restore Africa's developing strength, we will offer more support, including partnering with African commercial banks and regional banks to solve the issue of asymmetric information so that financing can better meet the needs of Africa to improve the service sector," said Hu Xiaolian, chairman of the Export-Import Bank of China.
Li Xiaopeng, chairman of State-owned China Everbright Group, said his company will work to increase the development of the aircraft leasing business in Africa, including wide-body and narrow-body aircraft, as well as help build and operate a number of airports.
