Sino-African Trade Cooperation Develops in Depth

According to the statistics of the Ministry of Commerce, China has been Africa’s largest trading partner for nine consecutive years. From January to June this year, the China-Africa trade volume reached USD 98.8 billion, with a year-on-year rate of increase of 16%. Bilateral trade has expanded from daily consumer goods and products of energy and mineral resources to high value-added products and agricultural products with special characteristics.

The primary feature of China-Africa economic and trade cooperation is mutual benefits. That means it not only helps Africa to improve its infrastructure and create jobs, but also promotes Chinese enterprises, Chinese standards and Chinese products to go global. During the Forum on China-Africa Cooperation, many insiders said that the cooperation between China and Africa in economy and trade has been further strengthened and will continue to develop in depth.

Further complementing each others’ advantages

Hu Xiaolian, chairman of the Export-Import Bank of China, said that trade promotion and investing in Africa include industrial projects in the manufacturing sector, as well as agricultural development projects and deep processing projects for agricultural products. “These are all aimed at increasing the value of export products from Africa, providing support in industrial and logistics park construction, and facilitating customs clearance for African enterprises. The Export-Import Bank of China will continue to work in the above areas. In the future, China will provide usd 5 billion as special financing funds for imports from Africa. The Export-Import Bank will make good use of these funds to offer financing to African export manufacturers and to further improve the trade between the two.”

 “The top ten exports to China account for 70% of Africa’s total export volume.” The president of the South Africa Black Business Council Sandil Zungu believes that 21% of African exports to China are high-value manufacturing industry products, which is the trade priority for both places. Among them, South Africa is focused on building its own industrial base and presents a good balance against China’s high-value export products.

Andy Lekenny Fihala, the CEO of the investment banking business of the South African Standard Bank, believes that China and Africa are complementary in many fields. For example, Africa is rich in natural resources and has a large young population with great potential, which is a major attraction for future development. “We need investment, capital and skills to better develop the African economy. China has a lot of experience in this area and can provide sufficient or even more support in terms of capital, skill, financing and services to promote Africa’s further development. ”

 “Transsion began to focus on business in Africa 10 years ago.” Zhu Zhaojiang, founder and CEO of Transsion Holdings Limited, said that unlike other brands, Transsion has been committed to long-term development in Africa and has established one of the largest and most complete after-sales service networks in Africa. In addition, Transsion has made a lot of efforts regarding localization, and its current localization rate has reached 90%.

Seeking attention for small and medium enterprises

Caroline Carruki, the CEO of the Kenya Private Enterprise Alliance, is paying attention to small and medium enterprises. She said that 80% of enterprises in Kenya are small and medium-sized, such that it is only when they can achieve further growth that the country’s foreign trade can develop to a higher level. However, due to a series of factors, it is still difficult for SMEs in African countries to exert their influence on the global stage.

Carruki further stated that Kenya will establish a lot of industrial parks along the route of the railway. The Kenyan government has proposed a revitalization of the following major areas by 2030: first, attracting more manufacturing companies to invest in Kenya, such as textiles and leather, so as to provide more jobs; second, it is hoped that the health sector can be developed by learning more from China’s experience, such as by establishing hospitals, centers for disease control and prevention and AIDS prevention and control centers; and finally, there are plans to make up for Kenya’s export deficit by promoting trade.

Zungu also noted the fact that China has expressed its support for the development of African SMEs at the 2018 Forum on China-Africa Cooperation Summit. “This is an excellent proposal.” Zungu hopes that, going forward, the two sides can cooperate to establish a special mechanism to provide financial services, such as financing, for well-managed African SMEs.

Vida Osman, the head of the Fengqun Group in Sudan introduced the idea that Sudan boasts a large agricultural area and that there are already Chinese companies investingthere. A fact that cannot be ignored is that the investment in education for young people also has great potential. However, in the past 20 years, problems including sanctions have caused obstacles to Chinese enterprises. Fortunately, the Forums on China-Africa Cooperation in recent years have advanced trade relations between China and Sudan.

“At present, African private enterprises often employ small loans to develop their business.” Osman said that because of this, more Chinese institutions and enterprises are encouraged to invest in Sudan, especially in the agricultural sector, in order to achieve Sino-Sudan agricultural trade.

Zhao Ying, president of Alibaba’s global business, also believes that it is SMEs that need more support. “We hope to improve local enterprises’ capability by installing mobile payment technology, Internet technology and sharing our experience in logistics so as to achieve win-win cooperation.”

Stressing the importance of the cultural tourism trade

Li Xiaopeng, chairman of China Everbright Group, said that the tourism trade between China and Africa can promote cultural exchanges and help to create “people-to-people bonds”. They will start with the “four mechanisms” to build a China-Africa tourism trade ecosystem, so as to build a shared future for China and Africa.

Li said that, in the past few years, the scale of the China-Africa tourism trade has grown rapidly. The number of Chinese tourists to Africa as of 2016 exceeded 11 million, accounting for 10% of the total number of Chinese outbound tourism. This figure has more than tripled from 3% six years ago, and it is still increasing at an annual average rate of 50%. “Chinese people, especially young people in China, are making Africa their first choice for novelty and adventure tourism. I believe that through this Summit, the two countries will witness a new leap in tourism trade.”

Li continued that, “for the next step, the Everbright Group will further arrange the African tourism market and contribute to building a shared community for China and Africa by creating a China-Africa tourism trade ecosystem. In order to achieve this, we will begin with the following four aspects: first, strengthening the dialog and exchange mechanism; second, establishing a two-way recommendation mechanism; third, building an industrial synergy mechanism as tourism requires support from transportation, and the service and financial industries, and especially needs the support ofthe environmental protection sector; and fourth, intensifying the service promotion mechanism so as to enrich the product categories and solve existing problems. In general, current China-Africa tourism products are relatively singular, and there is still a lack of tourism and exhibitions aimed at individuals or small groups. It is necessary to create a series of tourism products to serve both parties.”

Zhang Zhengao, general manager of Poly Group Co., Ltd. also said that cultural exchange is one of the eight action plans proposed by China. “Cultural exchanges are also a lubricant for economic and trade cooperation.” Zhang said that China and Africa have certain similarities in historical encounters and development stages, which have created a foundation for deepening cooperation in the cultural industry. Poly Group will actively research, participate in and promote the construction of the China-Africa Theater and Museum Alliance along the Silk Road. Through market operations, such as polishing and promotion, they will introduce outstanding traditional African culture and art forms to China, in particular by inviting the Poly Group to hold a performance tour, so as to address the spiritual and cultural needs of the Chinese people. On the other hand, they will seize the opportunity to export China’s excellent traditional art forms to African countries, including songs and dances, movies, and TV dramas. “We hope to enable our African friends to enjoy and consume Chinese cultural products.”