China’s interest in investing in Africa makes sense for both partners and should transform economies long reliant on commodity exports, Ethiopia’s prime minister said.
China pledged last year to give Africa $10 billion in concessional loans over the next three years and it is ploughing money into developing infrastructure in many nations on the world’s poorest continent.
Prime Minister Meles Zenawi said it made sense for China to spend in Africa, partly because its massive foreign exchange reserves are largely denominated in dollars and it needs to diversify those assets.
Rising labour costs in China also meant that the Asian giant would want to start relocating some manufacturing industries to countries where wage bills may not be as high.
Meles said that at the same time, African nations needed to shift towards industrialisation and boost skills after a decade of growth that has done little to transform economies driven by exports of natural resources and agricultural commodities.
“At the moment, this is consistent with China’s interests,”
Meles told the World Economic Forum on Africa in Tanzania.
“It’s in their interest to spend tens of billions of dollars in Africa and it’s in our interest to have access to those tens of billions of dollars,” he said.
West critical of Chinese motives
Some Western nations say China is interested only in extracting Africa’s natural resources to feed its fast-growing economy, cares little for African development and supports governments with dubious human rights records.
Some Chinese commentators say the West still treats Africa like a colony, whereas Beijing’s interest is based on mutual economic development.
Liu Guijin, special representative for African Affairs at the Chinese Foreign Affairs Ministry, said his country was not interested in promoting its policies or ideology in Africa at the expense of Western views.
“In China, we have a saying: in order to be rich, build more roads. And that is exactly what China is doing here, in Africa, in a lot of countries,” he said.
He said he was happy there had been a lot of development in African countries in recent years, but the development policies pursued by African governments were not China’s business.
“It is up to the African countries, African governments, African peoples who are making decisions on their own models of development,” he said.
Pic: Melez Zenawi