| Africa trade with China increases | Send to a friend |
| Tuesday, 14 September 2010 09:37 |
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TUNIS, Monday African trade with China is growing while its imports and exports with other major global markets are either flat or on the decline, according to a new report from the African Development Bank (AfDB). The Africa-China trade represents more than 10 per cent of the continent’s trade. In value terms, it represents between $114 billion and $52 billion in exports and $62 billion in imports. Africa has a trade deficit with China of about $10 billion, according to AfDB’s report, Chinese Trade and Investment Activities in Africa. Europe remains Africa’s largest export market, but its share has slumped from more than 50 per cent in the early 1990s to just over 30 per cent now. In contrast, China’s share of African exports continues to grow, outpacing other Asian countries. Japan’s share has dropped. In addition, China is aggressively investing in Africa’s infrastructure. Chinese investments have increased yearly by an average of 46 per cent over the last decade, mainly targeted to water, transport, electricity and information and communication technologies. Analysts say that the reasons for the increase stems from China‘s global economic strategy, shaped by its political objectives and its demand for energy, minerals and other resources. In the last decade, the African exports to China almost doubled, from almost five per cent in 2000 of total exports to 10 percent in 2007. This increase has been the most significant increase among the major trade blocs that Africa trades with –Europe, Asia (excluding China), the United States and Japan. Some 70 per cent of Chinese imports originate from four African countries: Angola -34 per cent, South Africa-20 per cent, Sudan -11 per cent and Republic of Congo-8 per cent. The high concentration of China-Africa trade manifests itself not just by country, but also by sector. Approximately 70 per cent of African exports to China consist of crude oil –in particular from Angola and Sudan—and 15 per cent of raw materials. Agricultural products from other African countries have only a modest share. “The strong demand from China has been a boom for Africa’s exporters. But it also led to a further concentration in the export basket of countries on the continent and, hence, exposes them to volatility in world commodity markets,” says Dr Léonce Ndikumana, the director of Research at the AfDB. Chinese exports are destined for relatively few countries. Some 60 per cent go to six countries, which includes South Africa, Egypt, Nigeria, Algeria, Morocco and Benin. Of China exports to Africa, machinery and transport equipment account for 38 per cent, manufactured goods-30 per cent and handicrafts-22 per cent. Chemicals and food products account for less than 10 per cent of the total. Machinery and transport equipment imports are linked to the strong presence of Chinese firms in the infrastructure sector, specifically in telecommunications, construction of roads and public buildings. “In general, Chinese export products are well suited to African demand,” explains Dr. Mthuli Ncube, AfDB’s Chief Economist. “Manufactured goods imports –electronic toys and textiles–allow Africans to expand their range of consumer purchases. Prices are often relatively low, making the products accessible to many Africans.” Source:AfDB Add this page to your favorite Social Bookmarking websites           |
