Tag: summit

African leaders in Beijing for 2018 FOCAC Summit

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Presidents and heads of government across Africa are in the Chinese city of Beijing for a high-level summit hosted by the Chinese government.

The Forum for Africa-China Cooperation, FOCAC, is a meeting between the two partners and is largely premised on ways to increase diplomatic, economic and bilateral ties.

The Summit has officially started today on September 3 lasting till tomorrow, September 4. This year’s edition is themed “China and Africa: Toward an Even Stronger Community with a Shared Future through Win-Win Cooperation.”

The summit is seen largely as a key diplomatic event hosted by China this year and attended by the largest number of foreign leaders to date. African leaders already in Beijing have held different levels of talks with their Chinese counterparts signing deals and also meeting investors.

This year is the third time the summit has convened, following the inaugural 2006 summit in Beijing and the 2015 summit in Johannesburg, said Chinese State Councilor and Foreign Minister Wang Yi.

African leaders and the chairman of the African Union (AU) will be in attendance, and the United Nations (UN) Secretary-General will be the esteemed guest, joined by 27 international and African groups as observers.

The interest in the forum is a result of China’s growing influence on the African continent and proves the FOCAC has been pragmatic and efficient, analysts said.

“Established 18 years ago, FOCAC has led international cooperation with Africa and has become a significant marker of South-South cooperation,” said Li Dan, director of Africa Studies Center of China Foreign Affairs University.

China’s Xi promises $14.7bn in investments in South Africa

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In addition to $14.7-billion in investments promised by China, the cash-strapped state-owned enterprises which had dodgy links to the Guptas, Eskom and Transnet, will receive major new Chinese loans worth a combined R37.7-billion.

Chinese President Xi Jinping has committed China to investing $14.7-billion in South Africa, President Cyril Ramaphosa said after meeting Xi in Pretoria on his state visit to South Africa on Tuesday. This would be a significant boost to Ramaphosa’s international drive to raise $100-billion in investment over the next five years.

Xi himself announced at the same joint press conference with Ramaphosa that China would take “active measures” to boost imports from South Africa to support the country’s development agenda and priorities.

State-owned China Development Bank has also agreed to lend $2.5-billion (R33.7-billion) to cash-strapped power utility Eskom to complete the Kusile coal-powered power station project in Mpumalanga.

And a $300-million (R4-billion) loan from Industrial and Commercial Bank of China (ICBC) will go to another ailing state-owned enterprise, Transnet.

The two loans deals were among 14 different agreements signed between South African and Chinese government departments, SoEs and private companies after the Ramaphosa-Xi official meeting.

Trade and Industry Minister Rob Davies explained to journalists that the measures which Xi had agreed to take to boost South African imports included sending more buying missions to South Africa, with a focus on purchasing value-added goods from this country. Pretoria sees such measures as steps towards establishing more balanced trade with China, rather than just exporting raw materials to that country, and importing Chinese manufactured goods.

As an example of the type of Chinese investment South Africa is looking for, Davies said that Ramaphosa and Xi would later on Tuesday participate by video in the launch of the R10-billion car factory built by the Chinese vehicle company BAIC in the Coega special economic zone near Port Elizabeth.

He said this investment had been announced at the time of Xi’s last state visit in 2015 and the first vehicles would be rolled out on Tuesday.

“What’s special about the Chinese is when they make a commitment to invest, they’re reliable and they happen,” he said.

Davies added that the Chinese TV and domestic appliance manufacturer Hisense would also be expanding its local production.

But he also disclosed that South Africa invests a lot more in China and other BRICS countries than they invest in South Africa and that this imbalance needed to be corrected.

He said China’s accumulated total investment in South Africa to date was about $11-billion and that South Africa had invested a greater amount than that in China.

South Africa’s investment imbalance with the other four BRICS countries as a whole was even greater. Total outward investment was about $60-billion against only $18-billion of inward investment. That’s why he would be arguing at the BRICS Business Forum in Sandton on Wednesday that BRICS needed to support more investment-led trade. If South Africa could expand its production capacity, it and other BRICS countries could also increase their manufacture of intermediate goods which would boost trade in supply chains.

Davies said about two thirds of world trade was now in such intermediate goods and that the focus needed to be on investment-led trade, not the other way round, (as many economists advocate).

The BRICS Forum, which all the leaders of the BRICS countries – Brazil, Russia, India, China and South Africa – are to attend, will be the first leg of the BRICS summit. On Thursday the five BRICS leaders, Ramaphosa, Xi, Brazilian President Michel Temer, Russian President Vladimir Putin and Indian Prime Minister Narendra Modi will have a meeting among themselves, followed by a retreat.

On Friday the five leaders will have two separate “outreach” meetings, one with several African leaders and another with non-African leaders, mostly representing regional organisations.

Davies said that apart from new investments, the other important announcement by Xi on Tuesday was to take active measures to increase imports from South Africa. In addition to sending more buying missions to this country, he said China had already relaxed health restrictions on South African beef imports and had undertaken to do the same for dairy imports.

 

 

Xi said the two countries would prioritise co-operation in infrastructure, trade and investment, science and technological innovation and financial co-operation.

Xi pledged China’s support for the big investment and jobs summit which Ramaphosa plans to hold later in 2018 in an effort to attract $100-billion of investment in five years and said China would take “active measures to expand imports from South Africa to support the government in achieving its development agenda and priorities”.

Xi said China and South Africa held similar views on international issues and so should work more together to strengthen multilateralism – the inclusion of all nations in reaching international decisions.

This would include bolstering the multilateral (international) trade system and increasing democracy in international relations.

(Contribution to Peter Fabricius)