China aims to become Africa’s largest trading partner

According to international reports, China aims to become Africa’s largest trading partner by 2030, surpassing the European Union (EU).

Compiled from the reports of the Organization for Economic Cooperation and Development (OECD), the World Bank, the International Monetary Fund (IMF), the China Exim Bank, the China Development Bank, the General Administration of Customs China’s Economic Intelligence Unit (EIU) offers research and advisory services, and Statista provides statistical data. China is reportedly on track to become Africa’s leading partner, leaving the EU, the US and Russia behind in the coming years.

At the “Third China-Africa Economic and Trade Fair” held in China in June, the General Administration of Customs of China announced the volume of China-Africa trade and China’s investments in Africa. Another 120 projects worth a total of $10.3 billion were signed at the fair.

EXPORTS ARE AT A RECORD LEVEL WITH 106 BILLION DOLLARS

Bilateral trade between China and Africa increased 35 percent to $254 billion in 2021 compared to 2020, while the continent’s exports reached a record level of $106 billion.

Trade volume between Africa and China increased by 11 percent last year compared to 2021, reaching $282 billion.

It is stated that China’s trade volume with South Africa, its largest trading partner on the African continent, reached $56.74 billion in 2022.

According to the report published by the EIU on August 3, China aims to overtake the EU and become Africa’s largest trading partner by 2030.

Investment by Chinese companies on the mainland in 2020-2021 is approximately $53.5 billion. While China’s imports to Africa have been $1.2 trillion since 2000, its exports have been $1.27 trillion.

Over the years, more than 3,500 Chinese companies have invested in Africa. 70 percent of the companies that invest in the continent are from the private sector and their investment stock in the continent is 43.4 billion dollars.

It is stated that, in addition to local workers, more than 200 thousand Chinese work in companies in Africa.

COMPENSATE AFRICA’S TRADE DEFICIT THROUGH SUBSIDIES

China has become the continent’s largest investor in construction, mining, transportation and energy, earning more than $24 billion in revenue from infrastructure projects in Africa in 2020.

25 percent of road, railway and electricity generation facility projects in Africa are being built with Chinese capital.

According to the IMF, China’s loans to the continent increased rapidly in the 2000s. China’s share of sub-Saharan Africa’s external public debt rose from 2 percent before 2005 to 17 percent in 2021.

Africa has had a trade deficit with China of more than $200 billion over the past 20 years. China, on the other hand, is trying to make up for this shortfall through investments and subsidies to continue its trade with Africa.

China participates in the infrastructure projects of 35 African countries, especially Kenya, Angola, Nigeria and Sudan. It is also planning some new projects related to the Democratic Republic of the Congo (DRC) and South Africa.

Chinese companies have an important participation not only in large infrastructure constructions in Africa, but also in the import of oil, minerals, energy, natural stones and metals, copper, iron and agricultural products.

AFRICA COVERS 25 PERCENT OF THE ENERGY DEFICIT

Energy is one of the prominent sectors in foreign trade between China and Africa. China covers 25 percent of the region’s energy needs.

Chinese companies, financial institutions and the government are involved in the construction of large dams worth billions of dollars in Africa.

Merowe, Shereik, Kajbar and Dal in Sudan, Lower Kafue Gorge in Zambia, Tekeze in Ethiopia, Mphanda Nkuwa in Mozambique, Mambila in Nigeria, Bui in Ghana, Imboulou in Congo, Belinga in Gabon, Cameroon Most dams, such as Lom Pangar, are built by China Exim Bank in partnership with China and other countries.

Angola, Nigeria and Mozambique occupy important positions among the countries critical to China’s energy imports from Africa. China imports half of its energy resources, natural stones and minerals from these countries.

MAKES THE MAJORITY OF INVESTMENTS IN 12 AFRICAN COUNTRIES

China makes the most investments in 12 resource-rich African countries. These countries are the Republic of South Africa, the Democratic Republic of the Congo, Zambia, Ethiopia, Angola, Nigeria, Kenya, Zimbabwe, Algeria, Ghana, Tanzania and Mozambique.

The countries that received the most investments from China in Africa are Nigeria with 38.3 billion dollars, Angola with 27.16 billion dollars and Ethiopia with 25.33 billion dollars.

The countries that received the most loans from China are Angola with 42.62 billion dollars, Ethiopia with 13.72 billion dollars, Zambia with 9.84 billion dollars, Kenya with 9.17 billion dollars, Nigeria with 6.73 billion dollars and Cameroon with 6.2 billion dollars. .

THE CHINESE HAVE THE LARGEST CAPITAL IN THE CONSTRUCTION OF DAMS IN AFRICA

On the African continent, the Chinese government and Chinese investment companies are building dams worth billions of dollars.

Most of the financing for hydroelectric dams built in Sudan, Zambia, Ethiopia and the Democratic Republic of the Congo was covered by China.

BUILT 100 PORTS SINCE 2000

So far, China has invested in more than 10,000 kilometers of railways and more than 100,000 kilometers of road infrastructure in Africa.

According to data shared by the Washington-based Center for Global Development (CGD), 31 percent of construction projects worth more than $50 million in Africa in 2020 were also financed by China.

From Nairobi to Mombasa and Addis Ababa to Djibouti, almost all railways are built, repaired and in some cases operated by China.

Chinese port companies have built 100 ports across Africa since 2000. The most important of these ports are Kribi in Cameroon, whose construction began in 2014, and Lekki in Nigeria.

China’s total land area across the entire continent is approximately 465 thousand square kilometers. Since 2012, China has established agricultural cooperation mechanisms with 23 African countries and regional organizations and signed 72 bilateral or multilateral agricultural cooperation agreements.

It is claimed that at the end of 2020, more than 200 Chinese companies had an investment stock of 1.11 billion dollars in the agricultural sector of 35 African countries. (AA)