financetom
Economy
financetom
/
Economy
/
China-Africa trade deficit prominent at conference
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
China-Africa trade deficit prominent at conference
Sep 2, 2018 3:54 AM

African leaders will likely press their Chinese hosts at a conference this week to help narrow their trade deficits with Beijing by shifting more manufacturing to their continent, the chief executive of the biggest African bank said.

Share Market Live

NSE

China has passed Europe and the United States as the biggest trading partner of most African countries. Most run large deficits with Beijing, exporting minerals and buying Chinese manufactured goods.

"The question of the trade imbalance is one that I think will be placed firmly on the table by the African delegates," the chief executive of South Africa's Standard Bank Group, Sim Tshabalala, told reporters.

China's commercial presence in Africa has prompted complaints in some countries that the continent gets too little from the relationship. Africa is a major target of Beijing's "Belt and Road" initiative to build ports, highways and other trade-related infrastructure, but some critics in Tanzania, Kenya and other countries say they leave hosts with too much debt.

"I would expect African leaders to put on the table the opportunity that arises from building the African continent's manufacturing capability in a way that is in the best interests of the African continent but benefits china as well," Tshabalala said Saturday.

The Forum on China-Africa Cooperation, opening Monday, brings together leaders from China and more than 50 African countries. Dozens of African leaders have met with Chinese President Xi Jinping ahead of the conference.

The participants are looking for ways to "advance common growth and development," said South Africa's foreign minister, Lindiwe Sisulu.

Some Chinese manufacturers are expanding to Africa but the bulk of Chinese investment goes into mining or construction of roads and other infrastructure. A state-owned automaker, BAIC Group, announced plans this year to start producing electric cars in South Africa.

As Chinese manufacturers move to making higher-value products, "the slack that is produced as a consequence can be taken up by African economies," according to Tshabalala.

Standard Bank represents the biggest Chinese investment in Africa to date, after state-owned Industrial and Commerce Bank of China Ltd. agreed in 2007 to buy 20 percent of the African lender for $5.5 billion. Since then, the two banks say they have collaborated on channeling billions of dollars of Chinese investment into Africa.

Some 300 companies account for the majority of China's business activity in Africa, but the region also has some 30,000 smaller Chinese firms that are of growing importance, said Francois Gamet, head of Standard Bank Group's Asian operation.

Asked about concerns over Africa's rising debts to China, the banks said those still are relatively small and most countries can repay them.

"The reality is that Chinese debt as a percentage of total African debt is still relatively small," said Kenny Fihla, Standard Bank's chief executive for corporate banking.

Governments in the region have "fiscal discipline," said Tshabalala.

"Wars, pestilence, violence and conflict have declined," he said. "We are quite comfortable that most of these countries have both the ability and the willingness to meet their obligations."

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
Britain to proceed with revaluation of commercial real estate in 2023, says Jeremy Hunt
Britain to proceed with revaluation of commercial real estate in 2023, says Jeremy Hunt
Nov 17, 2022
"Nearly two thirds of properties will not pay a penny more next year and thousands of pubs, restaurants and small high street shops will benefit," he said. Hunt added that a new government funded Transitional Relief scheme would benefit around 700,000 businesses.
UK economy set to shrink next year, says Jeremy Hunt in budget speech
UK economy set to shrink next year, says Jeremy Hunt in budget speech
Nov 17, 2022
The new forecast is for gross domestic product to contract by 1.4 percent next year compared with a projection for growth of 1.8 percent in the previous outlook published in March by the Office for Budget Responsibility (OBR).
UK economy: A crisis in the making for some time, with India trade deal offering hope
UK economy: A crisis in the making for some time, with India trade deal offering hope
Nov 13, 2022
The British-Asian former finance minister, who took charge at 10 Downing Street last month with the promise to fix the fiscal errors of predecessor Liz Truss’ disastrous mini-budget, has pledged to get a grip on the soaring inflation as a priority and warned of tough tax and spending decisions ahead.
Nirmala Sitharaman meets Janet Yellen, says will increase cooperation with US to address economic challenges
Nirmala Sitharaman meets Janet Yellen, says will increase cooperation with US to address economic challenges
Nov 11, 2022
Finance MInister Nirmala Sitharaman said the India-USA economic and financial partnership meeting in New Delhi today will lend greater vigour to both countries' economic relationship, strengthen their business-to-business links as well as facilitate a coordinated policy stance to address global economic challenges. 
Copyright 2023-2025 - www.financetom.com All Rights Reserved