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China juggernaut is beating the West to SA’s bounties

12 JUNE 2018 - 05:06 MARK ALLIX

Obed Bapela. Picture: GCIS 
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Western governments and companies would be wise to increase their investments in SA as China moves fast to secure markets in Africa’s most sophisticated economy.

This is according to Deputy Minister of Co-operative Governance and Traditional Affairs, Obed Bapela, who was speaking on Friday on the sidelines of a China-Africa industrial co-operation forum held in Pretoria.

China’s ambassador to SA, Lin Songtian, says the Asian giant has become Africa’s most reliable development partner, investing $100bn in roads, railways, ports, bridges, power plants and schools in 2017.

In 2017 bilateral trade between SA and China amounted to more than R318bn, making China the country’s largest single trading partner.

The forum came as China is deepening its involvement in Africa’s economic development, as part of the country’s global One Belt One Road initiative to re-establish Silk Road trade routes by land and sea.

There were also governance and security "challenges", and challenges in understanding and implementing the fundamentals of market economics. But China had identified African countries as hubs for development.


Lin said Africa needed to implement a comprehensive industrial strategy that was already taking shape under the AU, to create "win-win common development and prosperity" with China.

"If Africa is not independent economically, it is hard to be independent politically," said Lin, adding it was "time to escape foreign interference" by the US and EU.

"Never repeat the past of looting and colonialisation by the West."

Instead, China would be a "good friend and partner" to Africa. He said western nations were "afraid of losing control" in Africa. Meanwhile, they had blamed China for creating an African "debt crisis", looting African resources, exploiting its people and fuelling corruption.

Lin also said China would never sacrifice Africa’s environment and long-term interests for it own economic gains. Industrialisation in a nascent African free-trade area that included special economic zones was key to eradicating poverty and underdevelopment in Africa.

Lin said Africa suffered from three major hurdles to industrialisation. These were "backward infrastructure, a lack of professional and skilled personnel and a lack of capital".

There were also governance and security "challenges", and challenges in understanding and implementing the fundamentals of market economics. But China had identified African countries as hubs for development.

In the case of landlocked Ethiopia, the newly built 750km Addis Ababa-Djibouti railway system provided direct access to the Indian Ocean, linking the nation to a port through which the bulk of trade already passes.

Development funds

Lin also reminded delegates that China committed $60bn in development funds for Africa at the 2015 forum on China-Africa Co-operation in Johannesburg, and said billions more were available through the Brics grouping of nations and the One Belt One Road initiative.

This would dovetail with the AU’s Agenda 2063, a framework for accelerating social and economic development over the next 50 years. "Before 1980 China was worse off than many African countries in terms of poverty and social development," he said. But "starting from scratch" about 40 years ago, the country had made economic development a central focus.

This had raised China’s per-capita GDP from $156 annually in 1978 to $9,000 a year now, lifting 700-million Chinese out of poverty. China had been learning from the West, Lin said, but "if it was not good for us — kill it".

However, Lin also warned that despite China having adopted "a socialist market economy with Chinese characteristics" suitable to its own needs, "business is business — if there is no profit, there is no investment".

Bapela told the forum that in August 2018 the government is embarking on an "agrarian revolution" on communal land in former "homelands".

Traditional leaders had already donated 6-million hectares of land for leasehold purposes. This would soon rise to 16-million hectares, he said.

The project would involve the government and the private sector, and would include the fencing of agricultural land, animal husbandry and the revival of railway systems into those areas in order to promote food security, with surplus produce going to market.

This was to overcome a skills shortage in rural areas, and also to boost peri-urban shantytowns, by promoting agricultural and industrial beneficiation. "We are inviting everybody," Bapela said, when asked if the US, EU and Japan were included in these plans.

"But China has been moving faster," Bapela said.

allixm@bdfm.co.za

https://www.businesslive.co.za/bd/economy/2018-06-12-china-juggernaut-is-beating-the-west-to-sas-bounties/

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