In this spirit, Yang urged the international community not to withdraw its financial assistance from Africa.

This of course produced some positive results for the four African countries that Yang visited. In Rwanda, Yang pledged to increase China’s financial commitment to the value of US$7.8 million. While no precise details were given about how this economic package would be utilised, a Rwandan spokesperson indicated that the Rwandan government would like to see more Chinese involvement in the investment and technology sectors, outside of the current support Beijing lends to infrastructure, agriculture and education.

During his visit to Uganda, Yang signed a US$77 million low interest aid package to ‘in a renewed bid to boost the East African country’s development’. The aid deal ‘includes a framework agreement on provision of a concessional loan for the construction of e-governance project worth US$60 million and procurement of engineering equipment for Kampala City Council worth ten million dollars’. The rest of the aid money will be used for an economic and technical cooperation agreement to construct a hospital and government offices.

In Malawi, foreign minister Joyce Banda requested that China invest in the ‘processing of raw materials within the country to improve the quality of local products and create jobs’. Switching diplomatic ties in late December 2007, Malawi reaffirmed its commitment to the one-China policy and hoped to benefit from China’s investment largesse in boosting its value added production, especially within the agro-processing industry.

On the final stop of his visit, Yang, was reassured by South Africa’s foreign minister, Nkosana Dlamini-Zuma that the forthcoming national elections ‘were unlikely to change her country’s political scene’. In effect the visit to South Africa was more designed to strengthen the strategic partnership between Pretoria and Beijing. Recognising that South Africa holds a significant presence within international fora, Yang and Dlamini reiterated their common positions around working together in the UN Security Council as ‘regards major international and regional issues and hotspots’, as well as confirming their respective roles in the developing world and with respect to the international financial crisis.

The visit by the foreign minister to Rwanda and Uganda was a strategic choice in that both countries are members of the East African Community (EAC). With Rwanda being the current chair of the EAC, China has been able to make significant inroads into the region by creating valuable market access across a west-east corridor, ranging from Angola to Uganda and Kenya. To this end China is perhaps advancing its grand strategy in the region by consolidating its mineral interests across Angola, the DR Congo and Zambia. This was underscored by the less-than-conspicuous visit by the Chinese Minister of Commerce Chen Deminz to Kenya, Angola and Zambia concurrently during the foreign minister Yang’s tour.

Following on from his visit to Kenya, Chen’s next stop in his itinerary was Zambia. During the visit Chen signed a package of assistance agreements which provides a new set of loans and grants to the Zambian government. Intended to fund various projects including some symbolic infrastructure like a national sport stadium, an international conference centre as well as a government building complex, the assistance agreements are also meant to assist the country in developing its agricultural industry through the exchange of Chinese agricultural experts.

But perhaps the real highlight of Chen’s visit was the launch by the Zambia–China Economic and Trade Cooperation Zone (ZCCZ) of a sub-zone of a sub-zone in Lusaka, which promises to attract more investment into the country. The sub-zone is intended to expand Chinese investment in Zambia through establishing partnerships with local businesses as well as enabling Chinese investors to access local expertise, knowledge and culture. What remains unclear is the relationship between the sub-zone and the main industrial zone in Chambishi, the Copperbelt province. Perhaps it would act as an extension of the Chambishi Special Economic Zone, which recently received a pledge from 10 Chinese-funded companies to invest US$700 million in the Multi-Facility Economic Zone.

The last stop in Chen’s African visit was a two-day visit to the Angolan capital, Luanda. The visit underscored China’s continued relations with the oil rich nation, following closely on President Dos Santos’s trip to Beijing at the end of last year to seek further financial assistance to meet budgetary spending commitments in the area of infrastructure.

But Chen’s trip also marked the importance of Angola as China’s most significant trade partner in Africa in 2008. According to the latest trade information, Angola became China’s top trading partner in 2008. Bilateral trade between the two countries stood at an impressive US$23.5 billion. This was an all-time high for both sides, while China’s overall trade with Africa hit an astonishing high of US$106.8 billion at the end of 2008, with investments for the same period topping ‘over 5 million dollars’. This was well in advance of reaching the US$100 billion trade target by 2010.

What signals the visit by both Chinese ministers is delivery on the 2006 FOCAC measures. It seems that China has delivered on most of the eight measures which Chen noted were remarkable achievements. Of particular note was the official announcement that the construction of the five special economic or free trade zones were on track. Putting speculation to rest, the commerce minister confirmed that the five zones are located as follows: the Zambia–China Economic and Trade Cooperation Zone, the Guangdong Economic and Trade Cooperation Zone and the Lekky Duty Free Trade Zone in Lagos, Nigeria, the Egypt-Suez Economic and Trade Zone and the Ethiopian Orient Industrial Park.

But in a week of economic confidence, China was confronted by the blacklisting of two state-owned companies accused by the World Bank of collusion in bank funding in the Philippines. The two companies, China Road and Bridge Corporation and China State Construction Engineering Corporation, have considerable investments in Africa’s infrastructure sector, some of which were a result of World Bank tenders. The blacklisting means that these companies will not be eligible to tender for World Bank projects for several years, although some analysts did not see this as limiting China’s continued investments in Africa and believed that this was just a bump in the road for China.

INDIA NOT TO BE LEFT BEHIND

While China was making its usual diplomatic foray in the continent, the Indian Minister of State for External Affairs and Information and Broadcasting Anand Sharma paid a visit to Sierra Leone and Ivory Coast. The visit was seen as strengthening ties with the two west African nations through series of bilateral agreements including agriculture, education and IT and broadening multilateral interests.

To further the India–Africa dialogue, India also hosted a two-day India-Africa Business Partnership Summit in New Delhi. Speaking at the inauguration of the Summit, Minister for External Affairs Pranab Mukherjee called for increased economic co-operation between the two sides while the junior minister, Anand Sharma, emphasised that the global economic slowdown will not affect India’s trade relationship, which is projected to reach US$100 billion over the next few years.

It also seems that India is seeking to cement ties with the eastern and southern African markets. The Rwandan president, Paul Kagame, was invited to give the keynote address at the summit.

And in a veiled attempt to push Indian companies to compete with Chinese corporates, the minister of state for commerce and power, Jairam Ramesh, urged India Inc. to shift their focus from trade to more investments in Africa. This is perhaps the first official indication by the Indian government that China is seen a potential competitor to India’s economic interests in Africa. This is a significant development that should not be lost on African governments.

* Sanusha Naidu is research director of the China-in-Africa programme at Fahamu and is based in Cape Town.
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