China delivers on its funding promise to Africa

Chinese President Xi Jinping’s address to 48 African Heads of State at the Forum for China Africa Cooperation in Beijing yesterday was given a standing ovation from African leaders. “The impact that Focac has had on African countries refutes the view that a new colonialism is taking hold in Africa,” President Cyril Ramaphosa told the African fraternity to overwhelming applause.

At a time when US President Donald Trump is drastically cutting development financing in Africa, President Xi announced a further US$60 billion in new development funding for the African continent over the next three years. He also announced that the previous pledge of US$60 billion at the 2015 Focac Summit has either been delivered or arranged. Xi made a number of highly significant announcements for which Ramaphosa warmly thanked him as co-chair of the Focac summit.

“Africa’s least developed countries, heavily indebted countries, and landlocked and small island countries with diplomatic relations with China will be exempted from outstanding intergovernmental interest-free loan debts from the end of 2018,” President Xi announced, to notable African appreciation.

African Ministers of International Relations and Trade, as well as their Chinese hosts, were unanimous in their assessment that the ten cooperation plans the Focac summit had announced in 2015 were being fully implemented. “We applaud China for keeping to its promises,” President Ramaphosa said. “The industrial plan has resulted in industrial development, the agricultural modernisation plan in greater productivity and the infrastructure plan has boosted connectivity and integration on the continent.

According to President Xi, eight major initiatives by the Government of China would be implemented over the coming three years. The first being the launch of an industrial promotion initiative, which will build and upgrade trade and economic zones on the continent.

China will also implement a program of action on agricultural modernisation intended to ensure food security in Africa by 2030. Fifty agricultural assistance programs will be rolled out, and 500 senior agricultural experts will be sent to Africa. “We have also decided to give RMB 1 billion for emergency humanitarian food assistance caused by natural disasters on the continent,” Xi said.

Promises to see local currency settlement of loans and to facilitate bond issuance by African countries in China are tangible measures that will increase confidence in African economies. Particularly beneficial is the announcement that China will offer 50 000 scholarships to African students, and train 1 000 high calibre Africans in ten social and development planning workshops.

By way of comparison, the 28 European Union states have not even offered 1 000 bursaries for African students
China has seen remarkable economic ascendance, becoming the second largest economy in the world, and the third largest foreign investor. It has met almost all of the Millennium Development Goals. There are valuable lessons from its impressive growth model that can be used by Africans as a catalyst for development,” Ramaphosa said.

Ramaphosa warned, however, that Africa needs to send more value-added products to China to improve the trade balance where Africa largely exports primary products to China while China exports finished goods to Africa. “This limits our ability to extract the full value out of our natural resources and create jobs for our people

Source: eNCA

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