Africa-China trade plunges 30 percent

Staff Writer
BEIJING: As the global economic recession took its toll, trade volumes between China and Africa weakened by 30.5 percent in the first half of the year.

Speaking to African journalists here this week, the Commercial Counsellor in the Western Asia and African Affairs department in China's Ministry of Commerce, Xie Yajing, said lower resource prices and declining demand from China had seen trade volumes flag to $37.07 billion in the first six months of 2009 from $48 billion in the first half of 2008.

"Since 2000, average annual growth of China-Africa trade has averaged 3.5 percent," Xie said. "However, since most imports from Africa consist of natural resources such as metals and oil whose prices have weakened significantly since mid-2008, trade figures lowered in the first half of the year."

Although country-specific figures were not readily available, Botswana's main exports to China include copper and nickel, prices for which declined by as much as 80 percent last year.

Other Chinese imports from the African continent are coffee from Uganda, wine from South Africa, olive oil from Tunisia and tobacco from Zimbabwe.

In 2008, China-Africa trade reached $106.8, twice as much as that of 2006 and ten times that of 2000. Of the $106.8 billion, 0.8 billion was in the form of exports to Africa and  $56 billion of imports from Africa.

Xie said although trade volumes had decreased, in the same period, Foreign Direct Investment (FDI) from China to Africa had actually increased, compared to 2008. "In the first half of 2009, Chinese FDI to Africa stood at $552, up 81 percent from the same period last year," she said.

'The direct investment covered areas that included trade, production, processing and resources.'

Responding to a question about cheap quality goods from China flooding Africa, the counsellor appealed to African governments to help ensure that only products of good quality were sold to consumers. "We are aware of this problem and are doing everything we can to maintain the highest standards in the production of goods," she said.

"It is not the intention of the Chinese government to encourage dumping of goods (on Africa). However, since China is a very big country, we cannot do this alone; we need the importing countries to help us in this regard through their respective standards organisations."

Xie urged African countries to use the zero-tariff facility put in place by the Chinese government. "China has granted a zero-tariff arrangement to 500 products from 31 African countries," she said. "However, the use of this facility, which is meant to boost trade between the two parties, has been very minimal.

"Even so, we are looking at increasing the number of products that may be exported to China duty-free in a bid to further promote trade relations between us."

Since 1956, China has helped 53 African countries with over 900 projects that cover extensive areas. "China has also trained nearly 30, 000 professionals from Africa to-date and reduced or exempted parts of matured debts for 33 heavily-indebted poor countries (HIPC) and least developed countries (LDCs) in Africa," Xie said.



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