1. Trade within East Africa grows significantly in wake of unified customs regime
2. Red tape hinders commerce in East African Community
3. African Union imposes sanctions on Guinea junta
4. Human rights group calls for suspension of Zimbabwe from diamond trade
5. Pros and cons to huge Chinese investment in DRC
6. South Africa, Cuba strengthen trade relations
7. Africa is the most promising territory in the world for international brewing company
8. African nations seeking united front on trade talks
9. Ghana to host first Pan-African Trade Fair and investment conference
10. Senegal leader denies IMF gift was corruption
11. France jails arms smugglers who supplied Angola civil war
12. Dubai port firm says world trade starting to stabilize
13. China's production overcapacity: A waste but not a mortal danger
14. Emirates begins Luanda-Dubai flights
15. Africa heading for 2009 growth due to China, says analyst
16. Germany's MAN to build Volkswagen branded trucks, buses in South Africa
17. U.S. is losing control of the world's natural wealth to China
October 31, 2009
Trade within East Africa grows significantly in wake of unified customs regime
by Zephania Ubwani
Intra-regional trade within the East African Community region has grown by 49 per cent in the last five years the Customs Union has been in force.
Implementation of the trade arrangement has also earned the regional bloc other tangible benefits such as increased investments from outside. For instance, inflows of foreign direct investment (FDI) almost tripled from $ 692 million (Sh913.4 billion) in 2002 to $ 1.7billion (Sh2.2 trillion) in 2007 with Tanzania and Uganda receiving the largest proportions.
A Customs Union is a stage of regional integration where countries agree to remove all trade barriers between them. The protocol on the establishment of EAC Customs Union was signed in March 2004 by the heads of state of Tanzania, Uganda and Kenya and came into force in January the following year. Burundi and Rwanda, which joined the regional bloc in July 2007, became members of the EAC Customs Union in July 2009.
The main goal of the Customs Union is to liberalise and promote cross-border trade among member states of the regional bloc; Tanzania, Uganda, Kenya, Burundi and Rwanda.
Senior officials of EAC partner states recently met to take stock of the Customs Union and ways to transform it into a full fledged trade arrangement. The High Level Regional Forum, held as part of the EAC tenth anniversary activities, discussed key implementation issues and the main challenges to trade facilitation in the region. The meeting was organised by the EAC Directorate of Customs and Trade in partnership with USAID-Compete and the Investment Climate Facility (ICF).
"It is one of several commemorative events for the EAC 10th Anniversary which will reach climax on November 20th, 2009," said Mr Owora Richard Othieno, the senior public relations officer of the Community. He said over 150 participants took stock of achievements and challenges facing the Customs Union and discussed its transformation to a fully fledged trade arrangement.
The Citizen
Intra-regional trade within the East African Community region has grown by 49 per cent in the last five years the Customs Union has been in force.
Implementation of the trade arrangement has also earned the regional bloc other tangible benefits such as increased investments from outside. For instance, inflows of foreign direct investment (FDI) almost tripled from $ 692 million (Sh913.4 billion) in 2002 to $ 1.7billion (Sh2.2 trillion) in 2007 with Tanzania and Uganda receiving the largest proportions.
A Customs Union is a stage of regional integration where countries agree to remove all trade barriers between them. The protocol on the establishment of EAC Customs Union was signed in March 2004 by the heads of state of Tanzania, Uganda and Kenya and came into force in January the following year. Burundi and Rwanda, which joined the regional bloc in July 2007, became members of the EAC Customs Union in July 2009.
The main goal of the Customs Union is to liberalise and promote cross-border trade among member states of the regional bloc; Tanzania, Uganda, Kenya, Burundi and Rwanda.
Senior officials of EAC partner states recently met to take stock of the Customs Union and ways to transform it into a full fledged trade arrangement. The High Level Regional Forum, held as part of the EAC tenth anniversary activities, discussed key implementation issues and the main challenges to trade facilitation in the region. The meeting was organised by the EAC Directorate of Customs and Trade in partnership with USAID-Compete and the Investment Climate Facility (ICF).
"It is one of several commemorative events for the EAC 10th Anniversary which will reach climax on November 20th, 2009," said Mr Owora Richard Othieno, the senior public relations officer of the Community. He said over 150 participants took stock of achievements and challenges facing the Customs Union and discussed its transformation to a fully fledged trade arrangement.
The Citizen
Red tape hinders commerce in East African Community
by Zephania Ubwani
Non-tariff barriers (NTBs) continue to limit intra-regional trade in East Africa because policy makers are doing very little to curb them. They are responsible for the increased cost of doing business within the region, besides negatively impacting on trade and co-operation.
The most notable NTBs, according to a report, are customs and administration documentation, immigration procedures, cumbersome inspection requirements and police road blocks. Others are different trade regulations among EAC countries and “varying, cumbersome and costly” transit procedures in the EAC partner states according to the report.
Consultants hired to evaluate the East African Community Customs Union said in Arusha, Tanzania that administrative hitches associated with the barriers have not been dealt with firmly by regional leaders. They said the existing framework for monitoring NTBs was not only ineffective but does not deal with ad-hoc administrative cases which arise in the course of cross border trade. “This is because it takes long to constitute the committee meetings or for respective revenue authorities to exchange information in order to resolve emerging NTB issues,” they noted in the report to EAC high level forum on customs union.
The consultants proposed the establishment of rapid response units within the ministries of trade in member states to facilitate “faster and more effective” means of dealing with cross border trade hitches. “In addition, this will allow the national NTB monitoring committees to deal with structural as opposed to day to day operational issues,” they said in a report titled "An evaluation of the Implementation and Impact of the EAC Customs Union" presented to the meeting.
The study commissioned by the EAC directorate of customs and trade said removing NTBs has been much of a policy issue as any action can lead to tensions or threats to retaliation by the member states. The consultants proposed that officials of the ministries of Trade from all the five member states be charged with the responsibility of overseeing reported cases of NTBs and resolve disagreements which may arise.
A fully fledged customs union is expected in January 2010 after the end of the five year transitional period during which selected goods from Kenya to Tanzania and Uganda were being charged some duties one way. Currently, the highest duty paid on goods to Tanzania is five per cent and Uganda two per cent. From next year, goods will be traded duty free within partner states. The January zero tariff will also cover Burundi and Rwanda.
At the start of a two-day forum in Arusha, EAC director general of customs and trade Peter Kiguta said a mechanism for the removal of the barriers will soon be in place. “I wish to recognise the goodwill that exists in the partner states in eliminating the NTBs. In this context, a mechanism for their removal has been adopted and a time-bound programme for their elimination adopted,” he said.
Mr Kiguta defended the EAC customs union saying the benefits have accrued to the region from its implementation including trade and investment flows into East Africa from the outside world. For instance, trade between the region and other countries increased from $1.95 billion in 2003 to around $ 2.8 billion in 2007 representing a 195 per cent rise.
Non-tariff barriers (NTBs) continue to limit intra-regional trade in East Africa because policy makers are doing very little to curb them. They are responsible for the increased cost of doing business within the region, besides negatively impacting on trade and co-operation.
The most notable NTBs, according to a report, are customs and administration documentation, immigration procedures, cumbersome inspection requirements and police road blocks. Others are different trade regulations among EAC countries and “varying, cumbersome and costly” transit procedures in the EAC partner states according to the report.
Consultants hired to evaluate the East African Community Customs Union said in Arusha, Tanzania that administrative hitches associated with the barriers have not been dealt with firmly by regional leaders. They said the existing framework for monitoring NTBs was not only ineffective but does not deal with ad-hoc administrative cases which arise in the course of cross border trade. “This is because it takes long to constitute the committee meetings or for respective revenue authorities to exchange information in order to resolve emerging NTB issues,” they noted in the report to EAC high level forum on customs union.
The consultants proposed the establishment of rapid response units within the ministries of trade in member states to facilitate “faster and more effective” means of dealing with cross border trade hitches. “In addition, this will allow the national NTB monitoring committees to deal with structural as opposed to day to day operational issues,” they said in a report titled "An evaluation of the Implementation and Impact of the EAC Customs Union" presented to the meeting.
The study commissioned by the EAC directorate of customs and trade said removing NTBs has been much of a policy issue as any action can lead to tensions or threats to retaliation by the member states. The consultants proposed that officials of the ministries of Trade from all the five member states be charged with the responsibility of overseeing reported cases of NTBs and resolve disagreements which may arise.
A fully fledged customs union is expected in January 2010 after the end of the five year transitional period during which selected goods from Kenya to Tanzania and Uganda were being charged some duties one way. Currently, the highest duty paid on goods to Tanzania is five per cent and Uganda two per cent. From next year, goods will be traded duty free within partner states. The January zero tariff will also cover Burundi and Rwanda.
At the start of a two-day forum in Arusha, EAC director general of customs and trade Peter Kiguta said a mechanism for the removal of the barriers will soon be in place. “I wish to recognise the goodwill that exists in the partner states in eliminating the NTBs. In this context, a mechanism for their removal has been adopted and a time-bound programme for their elimination adopted,” he said.
Mr Kiguta defended the EAC customs union saying the benefits have accrued to the region from its implementation including trade and investment flows into East Africa from the outside world. For instance, trade between the region and other countries increased from $1.95 billion in 2003 to around $ 2.8 billion in 2007 representing a 195 per cent rise.
October 30, 2009
African Union imposes sanctions on Guinea junta
by Randy Fabi
The African Union said on Thursday it was imposing immediate sanctions against the leaders of Guinea's ruling military junta, which took power in a coup last December after the death of veteran leader Lansana Conte.
"These sanctions are targeted at the civilians and military personnel that are perpetuating these unconstitutional acts in Guinea," Lamamra Ramtane, AU commissioner for peace and security, told a meeting of the African body in Nigeria.
"It is not intended to target the people of Guinea," he said, specifying the sanctions would include such measures as the freezing of bank accounts and travel visas rather than trade sanctions against the country. He said the measures would be directed against the leadership of the CNDD, the ruling junta in the West African country led by Captain Moussa Dadis Camara.
International pressure and internal dissent have grown in Guinea, the world's top supplier of bauxite, since live ammunition was used against anti-government protesters in a stadium a month ago. A local rights group said 157 people were killed.
The United States, France and the European Union have called on Camara to step down and the International Criminal Court has said it is investigating the killings.
The EU agreed on October 27 to impose an arms embargo on the West African country, and restrict the travel and freeze assets of those involved in the killing of the protesters. The U.S. government has also restricted travel to the United States by some members of the junta and the government, as well as others who support actions that "undermine the restoration of democracy and the rule of law."
The AU had threatened sanctions if Camara, who promised to rein in the army and transfer power to civilian rule through elections, refuses to opt out of a poll set for January.
Reuters
The African Union said on Thursday it was imposing immediate sanctions against the leaders of Guinea's ruling military junta, which took power in a coup last December after the death of veteran leader Lansana Conte.
"These sanctions are targeted at the civilians and military personnel that are perpetuating these unconstitutional acts in Guinea," Lamamra Ramtane, AU commissioner for peace and security, told a meeting of the African body in Nigeria.
"It is not intended to target the people of Guinea," he said, specifying the sanctions would include such measures as the freezing of bank accounts and travel visas rather than trade sanctions against the country. He said the measures would be directed against the leadership of the CNDD, the ruling junta in the West African country led by Captain Moussa Dadis Camara.
International pressure and internal dissent have grown in Guinea, the world's top supplier of bauxite, since live ammunition was used against anti-government protesters in a stadium a month ago. A local rights group said 157 people were killed.
The United States, France and the European Union have called on Camara to step down and the International Criminal Court has said it is investigating the killings.
The EU agreed on October 27 to impose an arms embargo on the West African country, and restrict the travel and freeze assets of those involved in the killing of the protesters. The U.S. government has also restricted travel to the United States by some members of the junta and the government, as well as others who support actions that "undermine the restoration of democracy and the rule of law."
The AU had threatened sanctions if Camara, who promised to rein in the army and transfer power to civilian rule through elections, refuses to opt out of a poll set for January.
Reuters
Human rights group calls for suspension of Zimbabwe from diamond trade
Human Rights Watch has urged the Kimberley Process – the global diamond trade monitor – to suspend Zimbabwe because of abuses and smuggling in its Marange diamond fields.
Investigators from the Kimberley Process visited Zimbabwe in July and recommended the suspension of sales of Marange diamonds, citing “horrific” violence against civilians by the army.
“Zimbabwe has had more than enough time to put a halt to the human rights abuses and smuggling at Marange,” said Georgette Gagnon of Human Rights Watch for Africa. “Instead, it has sent more troops to the area, apparently trying to put a halt to independent access and scrutiny,” the organisation said in a statement .
Daily Dispatch
Investigators from the Kimberley Process visited Zimbabwe in July and recommended the suspension of sales of Marange diamonds, citing “horrific” violence against civilians by the army.
“Zimbabwe has had more than enough time to put a halt to the human rights abuses and smuggling at Marange,” said Georgette Gagnon of Human Rights Watch for Africa. “Instead, it has sent more troops to the area, apparently trying to put a halt to independent access and scrutiny,” the organisation said in a statement .
Daily Dispatch
October 29, 2009
Pros and cons to huge Chinese investment in DRC
by Stephanie Nieuwoudt
Concerns abound about a nine billion dollar Chinese investment in the Democratic Republic of the Congo, especially around environmental consequences and transparency. And, on the Chinese side, investors complain not only about the lack of security in the DRC but about their own government not providing enough support.
As part of the Sicomines deal, China will build a road network stretching for 4,000 km and a railway system spanning 3,200 km. This is a much needed development in a country the size of Western Europe and the second largest in Africa but with only 200 km of tarred road.
The building of a transport network is of strategic importance to the Chinese. It will make it easy to transport the copper (China has a concession to extract 10,6 million tons) and cobalt (626,619 tons) from mines in the Katanga region. Katanga province is part of the so-called Copperbelt and reaches from Angola through the DRC to Zambia.
The Sicomines agreement pulls in three Chinese companies: the China Railway Group, Sinohydro Corporation and the Metallurgical Group Corporation. These companies will have a controlling interest of 68 percent. The Congolese parastatal Gecamines has a 32 percent interest.
"It remains to be seen to what extent the agreement will bear fruit," said Johanna Jansson, a researcher at the Centre for Chinese Studies at the University of Stellenbosch near Cape Town. "Very few of the projects agreed upon have as yet been implemented."
The deal has not gone down well amongst critics. Jansson pointed out that one of the major contentious issues was the demand by the Chinese that the Congolese state guarantee the repayment of infrastructure investments, should the profits from the mining project not be sufficient.
Jansson said that this issue was resolved in August this year. This happened only because the International Monetary Fund indicated that it was not willing to continue a three year poverty reduction and growth programme in the DRC if the latter’s government was potentially beholden to China in terms of debt.
There has also been criticism from those who fear that the government has, through this deal, found a way to line the pockets of government officials. In general, "African governments have to be careful of bilateral agreements which are only beneficial to a small number of people in the short term," Dr Rita Cooma, CEO of a New York-based management consulting firm, said at the recent China-Africa Business Summit.
Jansson also raised the issue of Congolese negotiators having the necessary capacity to take on the Chinese negotiators, a perennial problem besetting African countries in all trade and economic talks.
Civil society and other stakeholders in the DRC have expressed concern about the transparency of the deal and have complained that they were not consulted. In a report about Chinese investment in Africa, Jansson argued that the Chinese will logically not engage with civil society as they see the Congolose government as their legal counterpart. However, it is imperative that the Congolese government and its representatives open up relations with civil society as it could play an important and positive role in assisting with project planning and implementation, she added.
There is fear that the Chinese will not honour environmental protocols. Artisanal mining and small operators have already done huge damage by excavating sites without care for plant or animal life. "A lot of environmental damage has already been done to the DRC by mining activities," Cooma said. "However, the responsibility to protect the environment should not be that of the investor alone. It is a matter of the DRC government being clear on environmental policies and enforcing them."
Jansson pointed out that there are also a number of private Chinese entrepreneurs involved in mining and agricultural activities in the DRC. They have very little interaction with the Chinese embassy in Kinshasa, capital of the DRC.
"Private entrepreneurs are experiencing great difficulties in the DRC," Ge Kaiyong, a director at the China-Africa Business Council, said at the China-Africa Business Summit that the non-governmental council co-hosted in Cape Town last week. "The DRC does not offer a secure political environment to investors because of the continuing war in the eastern DRC. There is also a huge language problem as the Congolese do not speak Mandarin and the private investors do not speak the local languages," he added.
There is little contact between the Chinese embassy in Kinshasa and private investors, which adds to the sense of insecurity. "Private investors need to feel that they are getting support. This could also be done through co-operation with the local chambers of commerce," he suggested. Jansson furthermore recommended that the Chinese ministry of foreign affairs opens up a consulate in Lubumbashi to assist with coordination between Chinese entrepreneurs, Congolese authorities and Congolese civil society.
IPS
Concerns abound about a nine billion dollar Chinese investment in the Democratic Republic of the Congo, especially around environmental consequences and transparency. And, on the Chinese side, investors complain not only about the lack of security in the DRC but about their own government not providing enough support.
As part of the Sicomines deal, China will build a road network stretching for 4,000 km and a railway system spanning 3,200 km. This is a much needed development in a country the size of Western Europe and the second largest in Africa but with only 200 km of tarred road.
The building of a transport network is of strategic importance to the Chinese. It will make it easy to transport the copper (China has a concession to extract 10,6 million tons) and cobalt (626,619 tons) from mines in the Katanga region. Katanga province is part of the so-called Copperbelt and reaches from Angola through the DRC to Zambia.
The Sicomines agreement pulls in three Chinese companies: the China Railway Group, Sinohydro Corporation and the Metallurgical Group Corporation. These companies will have a controlling interest of 68 percent. The Congolese parastatal Gecamines has a 32 percent interest.
"It remains to be seen to what extent the agreement will bear fruit," said Johanna Jansson, a researcher at the Centre for Chinese Studies at the University of Stellenbosch near Cape Town. "Very few of the projects agreed upon have as yet been implemented."
The deal has not gone down well amongst critics. Jansson pointed out that one of the major contentious issues was the demand by the Chinese that the Congolese state guarantee the repayment of infrastructure investments, should the profits from the mining project not be sufficient.
Jansson said that this issue was resolved in August this year. This happened only because the International Monetary Fund indicated that it was not willing to continue a three year poverty reduction and growth programme in the DRC if the latter’s government was potentially beholden to China in terms of debt.
There has also been criticism from those who fear that the government has, through this deal, found a way to line the pockets of government officials. In general, "African governments have to be careful of bilateral agreements which are only beneficial to a small number of people in the short term," Dr Rita Cooma, CEO of a New York-based management consulting firm, said at the recent China-Africa Business Summit.
Jansson also raised the issue of Congolese negotiators having the necessary capacity to take on the Chinese negotiators, a perennial problem besetting African countries in all trade and economic talks.
Civil society and other stakeholders in the DRC have expressed concern about the transparency of the deal and have complained that they were not consulted. In a report about Chinese investment in Africa, Jansson argued that the Chinese will logically not engage with civil society as they see the Congolose government as their legal counterpart. However, it is imperative that the Congolese government and its representatives open up relations with civil society as it could play an important and positive role in assisting with project planning and implementation, she added.
There is fear that the Chinese will not honour environmental protocols. Artisanal mining and small operators have already done huge damage by excavating sites without care for plant or animal life. "A lot of environmental damage has already been done to the DRC by mining activities," Cooma said. "However, the responsibility to protect the environment should not be that of the investor alone. It is a matter of the DRC government being clear on environmental policies and enforcing them."
Jansson pointed out that there are also a number of private Chinese entrepreneurs involved in mining and agricultural activities in the DRC. They have very little interaction with the Chinese embassy in Kinshasa, capital of the DRC.
"Private entrepreneurs are experiencing great difficulties in the DRC," Ge Kaiyong, a director at the China-Africa Business Council, said at the China-Africa Business Summit that the non-governmental council co-hosted in Cape Town last week. "The DRC does not offer a secure political environment to investors because of the continuing war in the eastern DRC. There is also a huge language problem as the Congolese do not speak Mandarin and the private investors do not speak the local languages," he added.
There is little contact between the Chinese embassy in Kinshasa and private investors, which adds to the sense of insecurity. "Private investors need to feel that they are getting support. This could also be done through co-operation with the local chambers of commerce," he suggested. Jansson furthermore recommended that the Chinese ministry of foreign affairs opens up a consulate in Lubumbashi to assist with coordination between Chinese entrepreneurs, Congolese authorities and Congolese civil society.
IPS
South Africa, Cuba strengthen trade relations
Trade and investment relations between South Africa and Cuba will be strengthened during the Havana International Trade Fair, the South African Department of Trade and Industry (DTI) said on October 28.
"The fair will provide an opportunity for deputy minister Thandi Tobias-Pokolo and her Cuban counterpart to discuss issues on the bilateral agenda, with particular focus on trade and investment," the South African Press Association cited the spokesman Sidwell Medupe as saying in a statement.
Tobias-Pokolo would lead a 40-member government and business delegation to Cuba for the Havana International Trade Fair, from November 2 to 7. Thirty-four South African companies would present their technological and industrial capabilities at the fair. Targeted sectors included agro-processing, biotechnology, automotives, construction, pharmaceuticals, capital equipment (including mining equipment), chemicals and engineering services. The companies included emerging, well established and women-owned ones. The DTI participated in the fair since 2004, with the exception of 2005.
Tobias-Pokolo said Cuba has the potential to emerge as a significant oil producer, with opportunities arising in this area. In addition, it has a growing tourism sector, and South Africa is well-placed to supply the necessary products to that market.
In 2008 South Africa exported goods to Cuba worth R81,979,457. Cuba's exports amounted to R15,741,495 during the corresponding period.
Xinhua
"The fair will provide an opportunity for deputy minister Thandi Tobias-Pokolo and her Cuban counterpart to discuss issues on the bilateral agenda, with particular focus on trade and investment," the South African Press Association cited the spokesman Sidwell Medupe as saying in a statement.
Tobias-Pokolo would lead a 40-member government and business delegation to Cuba for the Havana International Trade Fair, from November 2 to 7. Thirty-four South African companies would present their technological and industrial capabilities at the fair. Targeted sectors included agro-processing, biotechnology, automotives, construction, pharmaceuticals, capital equipment (including mining equipment), chemicals and engineering services. The companies included emerging, well established and women-owned ones. The DTI participated in the fair since 2004, with the exception of 2005.
Tobias-Pokolo said Cuba has the potential to emerge as a significant oil producer, with opportunities arising in this area. In addition, it has a growing tourism sector, and South Africa is well-placed to supply the necessary products to that market.
In 2008 South Africa exported goods to Cuba worth R81,979,457. Cuba's exports amounted to R15,741,495 during the corresponding period.
Xinhua
October 28, 2009
Africa is the most promising territory in the world for international brewing company
by David Carte
Africa really excites SABMiller because both its economic growth and its population are outgrowing all others, says CEO Graham McKay. He said the group would spend $370m in capex in a number of countries this year and $200m a year thereafter.
The allure of Africa is understandable - average consumption of clear beer is 6 litres per person a year compared to 60 litres in SA. SABMiller has been in Africa some time. It has managed operations in 16 countries and operations with its partner Castel in 22 countries.
Until now Africa and Asia have been lumped together in the group's reporting. Together these two continents accounted for 15% of group earnings before interest tax and amortisation. McKay said he was not at liberty to single out Africa yet - but it is a good deal more than half of that 15%. China is the only really significant contributor in Asia.
SABMiller's African operations outstripped all others from 2005-2008. Some continue to perform while others have slowed down in the current recession.
McKay said SABMiller is generally welcomed as an investor in Africa. "Our operations give a boost to each country's formal business sector. Indeed, in Southern Sudan we are the only formal business. We generate jobs and pay excises and taxes. There is a huge multiplier effect. For every direct job with us, there are sometimes hundreds along the supply chain."
More and more SABMiller is contracting thousands of farmers in Africa to grow inputs such as barley, sorghum and even cassava. Said McKay: "We don't own farms. We are terrified of farming, so, working with the governments, we leave it to the locals. Many farms are less than an acre. In Uganda alone 8 000 farmers derive employment from the company. In Zambia and Tanzania there are bigger commercial farms."
Six of SABMiller's subsidiaries are listed on African stock exchanges. Mark Bowman, MD of SABMiller Africa, said the group was using management techniques learned in SA.
As far as it can, it attempts to span the drinks portfolio in each territory - from bottled drinking water to soft drinks and traditional beer to clear beer and even premium brands. SABMiller sells a third of all Coca-Cola in Africa.
At this stage opaque "informal" beers outsell clear beer three to one. SABMiller is happy to play in this market. Indeed, one of its affordable products, Tubuku, is still fermenting in the package when the customer buys it.
McKay explained that bottled water in Africa is a huge market but added that it was "nothing like Perrier in Africa." Because most the water available is not fit for human consumption and in most places piped water is simply not available, potable water is delivered universally in containers, many of them very large. He says water sales will grow at double digits annually.
Water and soft drink production fit in well with brewing. But they are distributed quite separately. Africa requires a different approach because countries are mostly small and consumers are relatively poor.
SABMiller is the number one player in nearly all its markets. It recently entered three new territories - Nigeria, Ethiopia and Southern Sudan, where it has erected a second-hand brewery and a soft drink plant. Bowman said Southern Sudan could be seen as high risk but the hope is that today's peace initiatives at the highest level will bear fruit and the territory will be separated from the Muslim north.
Logistics in Angola remain a nightmare but it is the country with the best growth prospects. The company is to erect a fairly large brewery (2.5m hectolitres) in Luanda. This will be its second brewery there. McKay said the strategy is to "halve the price of beer and to double the price of beer." A beer at $1 a serving is expensive in Africa, so the idea is to drive down the cost of lower-range products. At the same time, premium beers will be available - at a cost.
Breweries in Africa are generally a quarter of the size of those in SA - typically with capacities of 500 000 hectolites a year, compared to 2m hectoliters in South Africa.
SABMiller employs a decentralised management model. Each country has its own board and management structure. The operations are locally staffed - but SABMiller's learnings in dozens of markets are employed in all of them.
McKay said the group hires top quality people with high level skills in brand building, consumer relations. He says investment has been heavy, so that the African operations outside SA have not generated cash - but he thinks cash can flow back to the centre in 18 months.
Africa really excites SABMiller because both its economic growth and its population are outgrowing all others, says CEO Graham McKay. He said the group would spend $370m in capex in a number of countries this year and $200m a year thereafter.
The allure of Africa is understandable - average consumption of clear beer is 6 litres per person a year compared to 60 litres in SA. SABMiller has been in Africa some time. It has managed operations in 16 countries and operations with its partner Castel in 22 countries.
Until now Africa and Asia have been lumped together in the group's reporting. Together these two continents accounted for 15% of group earnings before interest tax and amortisation. McKay said he was not at liberty to single out Africa yet - but it is a good deal more than half of that 15%. China is the only really significant contributor in Asia.
SABMiller's African operations outstripped all others from 2005-2008. Some continue to perform while others have slowed down in the current recession.
McKay said SABMiller is generally welcomed as an investor in Africa. "Our operations give a boost to each country's formal business sector. Indeed, in Southern Sudan we are the only formal business. We generate jobs and pay excises and taxes. There is a huge multiplier effect. For every direct job with us, there are sometimes hundreds along the supply chain."
More and more SABMiller is contracting thousands of farmers in Africa to grow inputs such as barley, sorghum and even cassava. Said McKay: "We don't own farms. We are terrified of farming, so, working with the governments, we leave it to the locals. Many farms are less than an acre. In Uganda alone 8 000 farmers derive employment from the company. In Zambia and Tanzania there are bigger commercial farms."
Six of SABMiller's subsidiaries are listed on African stock exchanges. Mark Bowman, MD of SABMiller Africa, said the group was using management techniques learned in SA.
As far as it can, it attempts to span the drinks portfolio in each territory - from bottled drinking water to soft drinks and traditional beer to clear beer and even premium brands. SABMiller sells a third of all Coca-Cola in Africa.
At this stage opaque "informal" beers outsell clear beer three to one. SABMiller is happy to play in this market. Indeed, one of its affordable products, Tubuku, is still fermenting in the package when the customer buys it.
McKay explained that bottled water in Africa is a huge market but added that it was "nothing like Perrier in Africa." Because most the water available is not fit for human consumption and in most places piped water is simply not available, potable water is delivered universally in containers, many of them very large. He says water sales will grow at double digits annually.
Water and soft drink production fit in well with brewing. But they are distributed quite separately. Africa requires a different approach because countries are mostly small and consumers are relatively poor.
SABMiller is the number one player in nearly all its markets. It recently entered three new territories - Nigeria, Ethiopia and Southern Sudan, where it has erected a second-hand brewery and a soft drink plant. Bowman said Southern Sudan could be seen as high risk but the hope is that today's peace initiatives at the highest level will bear fruit and the territory will be separated from the Muslim north.
Logistics in Angola remain a nightmare but it is the country with the best growth prospects. The company is to erect a fairly large brewery (2.5m hectolitres) in Luanda. This will be its second brewery there. McKay said the strategy is to "halve the price of beer and to double the price of beer." A beer at $1 a serving is expensive in Africa, so the idea is to drive down the cost of lower-range products. At the same time, premium beers will be available - at a cost.
Breweries in Africa are generally a quarter of the size of those in SA - typically with capacities of 500 000 hectolites a year, compared to 2m hectoliters in South Africa.
SABMiller employs a decentralised management model. Each country has its own board and management structure. The operations are locally staffed - but SABMiller's learnings in dozens of markets are employed in all of them.
McKay said the group hires top quality people with high level skills in brand building, consumer relations. He says investment has been heavy, so that the African operations outside SA have not generated cash - but he thinks cash can flow back to the centre in 18 months.
October 27, 2009
African nations seeking united front on trade talks
by Patrick Werr
African countries were drawing up a unified position this week to try to pry open the markets of developed countries ahead of a World Trade Organisation (WTO) ministerial conference in Geneva on Nov. 30.
Delegates to an African trade ministers conference that opened in Cairo on October 27 said continuing delays on a new global trade deal were crippling African development, especially in the wake of the global economic crisis.
"Africa needs an early, balanced and fast conclusion of this round. So it will be an appeal to the major players to come to the table, because this time around, it's not Africa who is delaying the process," said S.B. Naresh Servansing, a delegate from Mauritius.
African nations are seeking broader access to developed markets of their agricultural produce in particular, especially cotton, which is grown widely across the continent. They also complain that subsidies to producers in rich countries, particularly to U.S. cotton growers, are distorting world trade to the detriment of producers in poorer countries.
Servansing, chief negotiator for the 79-member group of African, Caribbean and Pacific countries at the WTO, said talks should be all inclusive in a way that allows African and other vulnerable countries put their concerns on the table. "There is a proliferation of small group meetings in Geneva at the moment in terms of bilaterals and peripherals which is taking place outside the existing, approved and endorsed structures of negotiation which were set up," he said.
Despite an intensive work programme agreed last month, WTO talks have not achieved enough to reach a core deal in implementing the Doha negotiations, now in their eighth year.
"It's important because trade is one of the engines of growth," Egyptian Ambassador Hisham Badr, African Coordinator for WTO matters in Geneva, said on the meeting's sidelines. The failure to enact the Doha trade pact and the global financial crisis had caused private investment to fall by 40 percent in 2008 and African losses from exports of $251 billion in 2009, Badr said in a statement to the meeting. "If we can't put our products on the market, we cannot produce, then our farmers and producers and everyone cannot have the economic growth that is needed," Badr said.
The three-day WTO conference that begins on Nov. 30 will not include negotiations, but will give African nations a chance for their views to be heard, delegates said. The WTO's Director-General Pasqua Lamy said on Oct. 23 that a 2010 target for a commerce deal was out of reach unless countries accelerate their negotiations.
Forex Yard
African countries were drawing up a unified position this week to try to pry open the markets of developed countries ahead of a World Trade Organisation (WTO) ministerial conference in Geneva on Nov. 30.
Delegates to an African trade ministers conference that opened in Cairo on October 27 said continuing delays on a new global trade deal were crippling African development, especially in the wake of the global economic crisis.
"Africa needs an early, balanced and fast conclusion of this round. So it will be an appeal to the major players to come to the table, because this time around, it's not Africa who is delaying the process," said S.B. Naresh Servansing, a delegate from Mauritius.
African nations are seeking broader access to developed markets of their agricultural produce in particular, especially cotton, which is grown widely across the continent. They also complain that subsidies to producers in rich countries, particularly to U.S. cotton growers, are distorting world trade to the detriment of producers in poorer countries.
Servansing, chief negotiator for the 79-member group of African, Caribbean and Pacific countries at the WTO, said talks should be all inclusive in a way that allows African and other vulnerable countries put their concerns on the table. "There is a proliferation of small group meetings in Geneva at the moment in terms of bilaterals and peripherals which is taking place outside the existing, approved and endorsed structures of negotiation which were set up," he said.
Despite an intensive work programme agreed last month, WTO talks have not achieved enough to reach a core deal in implementing the Doha negotiations, now in their eighth year.
"It's important because trade is one of the engines of growth," Egyptian Ambassador Hisham Badr, African Coordinator for WTO matters in Geneva, said on the meeting's sidelines. The failure to enact the Doha trade pact and the global financial crisis had caused private investment to fall by 40 percent in 2008 and African losses from exports of $251 billion in 2009, Badr said in a statement to the meeting. "If we can't put our products on the market, we cannot produce, then our farmers and producers and everyone cannot have the economic growth that is needed," Badr said.
The three-day WTO conference that begins on Nov. 30 will not include negotiations, but will give African nations a chance for their views to be heard, delegates said. The WTO's Director-General Pasqua Lamy said on Oct. 23 that a 2010 target for a commerce deal was out of reach unless countries accelerate their negotiations.
Forex Yard
Ghana to host first Pan-African Trade Fair and investment conference
The fair, on the theme: "Uniting Africa through Trade and the Rest of the World," is aimed at establishing effective trade relations to hasten the economic progress of Africa and the rest of the world and strengthen African small-scale entrepreneurs who provide up to 80 per cent of jobs on the continent.
Eighty (80) of the 200 participants expected have so far registered.
Activities to be undertaken include exhibition, seminars and conferences on topics such as: "Creating a Conducive Environment for Investors Seeking Opportunity in Ghana," "Redefining the African Foreign Policy on Trade and Investment" and "Breaking Investment Barriers (Challenges the Caribbean faces)."
Mrs Lydia Yahaya, Chief Executive Officer of Liego Company Limited, an event organising company, who launched the fair, said the event would draw the world's attention to Africa to deepen the vision of Ghana's first President, 0sagyefo Dr Kwame Nkrumah, who sought to unite Africa with the aim of making it a centre of attraction to the outside world.
She said the fair hope to erase all the colonial barriers between African nations, which made it difficult for them to invest or trade among themselves. Mrs Yahaya said it would also serve as a forum to exhibit the various potentials and businesses available on the continent. It is also expected to create employment opportunities.
Mrs Yahaya said the fair, sought to provide the needed stage for the complete expression of the United Nations laudable HELP AFRICA initiative.
Mr Henry Baiden, Public Relations Manager of Leigo Company, said the aim of bringing Africa together had always been expressed at ministerial meetings with African states.
Mr Seth Asamoah, Chief Marketing Manager, Ghana Trade Fair Company and a member of the planning committee of the fair, fairs served as links for investors to access investment opportunities.
Peace FM Online
Senegal leader denies IMF gift was corruption
Senegal President Abdoulaye Wade said October 27 it was "nonsense" to see a gift of 133,000 euros given to a departing International Monetary Fund agent as corruption.
An IMF report said its regional agent Alex Segura was given the money as he left his three-year tenure as the body's representative in the west African country.The incident on September 25 provoked a scandal in Dakar, but Wade said there was no question of corruption and the large sum given to Segura came about as a mistake on the part of an aide.
The 83-year-old Senegalese leader refused to answer questions on the incident at a news conference, but issued a statement giving his account of events. "The aide-de-camp asked the president of the republic if he should give him (Segura) something, in keeping with custom. The president of the republic replied 'yes' without saying what the sum should be, because there was a custom. The aide-de-camp made a mistake over the amount and realised his mistake later," Wade said in the statement.
According to the Fund, Wade handed Segura the gift after a farewell dinner which the IMF agent said he later discovered was a large sum of money -- 100,000 euros and 50,000 dollars (33,000 euros). "It's nonsense to talk about corruption with someone who is leaving for good without the least chance of meeting you again," Wade said in his statement. "Mr Segura was not a friend of Senegal. He was very often tough in his judgments. There was no reason to give him a huge gift. But according to our traditions, when someone who has stayed with you a long time leaves, you give him a gift, either in kind or as a small sum of money to allow him to buy souvenirs for his family."
The money has since been returned to Senegalese authorities and Wade "acknowledged that the amount that was provided was a mistake," the IMF said.
The Senegalese opposition denounced the incident as "attempted corruption" and the country's prime minister on October 28 leapt to the defence of Wade, one of Africa's high-profile leaders who has ruled Senegal since 2000 and has spoken out against graft.
In December the IMF chided Senegal for lapses in following a plan for economic reforms and at the same time pledged 75.6 million dollars (56.2 million euros) in aid to help the country face the effects of the economic crisis.
Segura, a Spanish national now based in Washington, has made no comments on the matter since the scandal broke.Still, Senegalese commentators have questioned why he accepted the "gift" and left the country with the package of cash. In explaining Segura's actions, the IMF said he was worried about missing his flight and was concerned about finding a place to stash the cash safely in Senegal. Upon arriving at his destination, Barcelona, Segura contacted IMF headquarters which began making arrangements to return the cash.
Wade also has not commented publicly on the incident. His followers see him as the father of change after he broke Senegal's 40-year-long uninterrupted socialist rule. But opponents have accused him of grooming a successor, possibly his son, although the octogenarian recently announced he wants to run for a third term in 2012.
An IMF report said its regional agent Alex Segura was given the money as he left his three-year tenure as the body's representative in the west African country.The incident on September 25 provoked a scandal in Dakar, but Wade said there was no question of corruption and the large sum given to Segura came about as a mistake on the part of an aide.
The 83-year-old Senegalese leader refused to answer questions on the incident at a news conference, but issued a statement giving his account of events. "The aide-de-camp asked the president of the republic if he should give him (Segura) something, in keeping with custom. The president of the republic replied 'yes' without saying what the sum should be, because there was a custom. The aide-de-camp made a mistake over the amount and realised his mistake later," Wade said in the statement.
According to the Fund, Wade handed Segura the gift after a farewell dinner which the IMF agent said he later discovered was a large sum of money -- 100,000 euros and 50,000 dollars (33,000 euros). "It's nonsense to talk about corruption with someone who is leaving for good without the least chance of meeting you again," Wade said in his statement. "Mr Segura was not a friend of Senegal. He was very often tough in his judgments. There was no reason to give him a huge gift. But according to our traditions, when someone who has stayed with you a long time leaves, you give him a gift, either in kind or as a small sum of money to allow him to buy souvenirs for his family."
The money has since been returned to Senegalese authorities and Wade "acknowledged that the amount that was provided was a mistake," the IMF said.
The Senegalese opposition denounced the incident as "attempted corruption" and the country's prime minister on October 28 leapt to the defence of Wade, one of Africa's high-profile leaders who has ruled Senegal since 2000 and has spoken out against graft.
In December the IMF chided Senegal for lapses in following a plan for economic reforms and at the same time pledged 75.6 million dollars (56.2 million euros) in aid to help the country face the effects of the economic crisis.
Segura, a Spanish national now based in Washington, has made no comments on the matter since the scandal broke.Still, Senegalese commentators have questioned why he accepted the "gift" and left the country with the package of cash. In explaining Segura's actions, the IMF said he was worried about missing his flight and was concerned about finding a place to stash the cash safely in Senegal. Upon arriving at his destination, Barcelona, Segura contacted IMF headquarters which began making arrangements to return the cash.
Wade also has not commented publicly on the incident. His followers see him as the father of change after he broke Senegal's 40-year-long uninterrupted socialist rule. But opponents have accused him of grooming a successor, possibly his son, although the octogenarian recently announced he wants to run for a third term in 2012.
France jails arms smugglers who supplied Angola civil war
by Pascale Juilliard
A French court slapped jail terms on October 27 on the main players in a network that smuggled arms to war-torn Angola and included an ex-minister and the son of the late president Francois Mitterrand. Russian-Israeli tycoon Arkady Gaydamak was convicted in absentia for organising the 1990s arms sales and sentenced to six years in jail at the trial that exposed a ring of corruption at the highest levels of Paris politics.
The huge Soviet-made arsenal that fuelled Angola's grim civil war included 420 tanks, 150,000 shells, 170,000 anti-personnel mines, 12 helicopters, and six warships and was worth 790 million dollars.
Only six of the 42 defendants were acquitted in the trial dubbed "Angolagate" that began last October after years of complex investigations.
"Rarely have we reached such levels in the organisation and the dissimulation of criminality generating considerable profits," said judge Jean-Baptiste Parlos as the verdicts were handed down. He described Gaydamak, 57, as someone who "behind the mask of worthiness... scoffs at borders, laws and justice."
French businessman Pierre Falcone, 55, was also sentenced to six years' jail for his role in the illegal trade and was immediately taken into custody by police at the courtroom, despite his plans to appeal.
Ex-interior minister Charles Pasqua, 82, was ordered jailed for a year, plus two more years suspended, and fined 100,000 euros (150,000 dollars). Now a French senator, he was not in court but his lawyers said he intends to appeal.
Jean-Christophe Mitterrand, 62, who was an advisor on Africa to his president father, was given a two-year suspended sentence and a 375,000-euro fine for receiving embezzled funds from the illegal arms sales to Angola. He accepted millions of euros in "consultant fees" on the sale of the weapons to President Eduardo Dos Santos's regime for use in the 1979-2002 bush war against UNITA rebels.
The arms originated in the former Soviet bloc and were sent to Africa in breach of French law through a French-based firm and its eastern European subsidiary. Sales began when Socialist president Mitterrand was in power in 1993 and continued until 1998, three years after conservative Jacques Chirac's election.
Although no Angolan officials were indicted, court papers alleged that Dos Santos and his inner circle received millions of dollars in kickbacks. Angola pushed to have the trial abandoned, and Sarkozy was forced to fly to Luanda in May 2008 to mend ties strained by the case.
The trial saw judges struggling to make sense of a labyrinth of murky deals linking French politicians, businessmen and public figures and a massive arms shipment to a war-torn African country. Several defendants insisted the trade was carried out in full view of French authorities but that Paris kept quiet to shore up a regional ally and protect an important source of oil.
Despite a promise to come to Paris and explain his role, Gaydamak remained abroad and is believed to be currently in Moscow. The court heard that he used his contacts in Eastern Europe to get his hands on the Soviet-designed weapons that were shipped to Luanda. He was convicted on counts of selling arms, influence peddling and money laundering.
Falcone, who holds French, Canadian and Angolan citizenship, was named Angola's ambassador to the United Nations Paris-based cultural organisation UNESCO in 2003 and attempted to claim diplomatic immunity in the case. He was convicted for influence peddling, arms sales and embezzlement, and Pasqua for influence peddling.
Right-wing politician Jean-Charles Marchiani was sentenced to three years in prison, with 21 months of that to be suspended, for complicity in influence peddling and embezzlement.
The French financier and best-selling author Paul-Loup Sulitzer got a 15-month suspended sentence for receiving embezzled funds.
Jacques Attali, a former advisor to the late president Mitterrand, and the magistrate Georges Fenech were acquitted.
A French court slapped jail terms on October 27 on the main players in a network that smuggled arms to war-torn Angola and included an ex-minister and the son of the late president Francois Mitterrand. Russian-Israeli tycoon Arkady Gaydamak was convicted in absentia for organising the 1990s arms sales and sentenced to six years in jail at the trial that exposed a ring of corruption at the highest levels of Paris politics.
The huge Soviet-made arsenal that fuelled Angola's grim civil war included 420 tanks, 150,000 shells, 170,000 anti-personnel mines, 12 helicopters, and six warships and was worth 790 million dollars.
Only six of the 42 defendants were acquitted in the trial dubbed "Angolagate" that began last October after years of complex investigations.
"Rarely have we reached such levels in the organisation and the dissimulation of criminality generating considerable profits," said judge Jean-Baptiste Parlos as the verdicts were handed down. He described Gaydamak, 57, as someone who "behind the mask of worthiness... scoffs at borders, laws and justice."
French businessman Pierre Falcone, 55, was also sentenced to six years' jail for his role in the illegal trade and was immediately taken into custody by police at the courtroom, despite his plans to appeal.
Ex-interior minister Charles Pasqua, 82, was ordered jailed for a year, plus two more years suspended, and fined 100,000 euros (150,000 dollars). Now a French senator, he was not in court but his lawyers said he intends to appeal.
Jean-Christophe Mitterrand, 62, who was an advisor on Africa to his president father, was given a two-year suspended sentence and a 375,000-euro fine for receiving embezzled funds from the illegal arms sales to Angola. He accepted millions of euros in "consultant fees" on the sale of the weapons to President Eduardo Dos Santos's regime for use in the 1979-2002 bush war against UNITA rebels.
The arms originated in the former Soviet bloc and were sent to Africa in breach of French law through a French-based firm and its eastern European subsidiary. Sales began when Socialist president Mitterrand was in power in 1993 and continued until 1998, three years after conservative Jacques Chirac's election.
Although no Angolan officials were indicted, court papers alleged that Dos Santos and his inner circle received millions of dollars in kickbacks. Angola pushed to have the trial abandoned, and Sarkozy was forced to fly to Luanda in May 2008 to mend ties strained by the case.
The trial saw judges struggling to make sense of a labyrinth of murky deals linking French politicians, businessmen and public figures and a massive arms shipment to a war-torn African country. Several defendants insisted the trade was carried out in full view of French authorities but that Paris kept quiet to shore up a regional ally and protect an important source of oil.
Despite a promise to come to Paris and explain his role, Gaydamak remained abroad and is believed to be currently in Moscow. The court heard that he used his contacts in Eastern Europe to get his hands on the Soviet-designed weapons that were shipped to Luanda. He was convicted on counts of selling arms, influence peddling and money laundering.
Falcone, who holds French, Canadian and Angolan citizenship, was named Angola's ambassador to the United Nations Paris-based cultural organisation UNESCO in 2003 and attempted to claim diplomatic immunity in the case. He was convicted for influence peddling, arms sales and embezzlement, and Pasqua for influence peddling.
Right-wing politician Jean-Charles Marchiani was sentenced to three years in prison, with 21 months of that to be suspended, for complicity in influence peddling and embezzlement.
The French financier and best-selling author Paul-Loup Sulitzer got a 15-month suspended sentence for receiving embezzled funds.
Jacques Attali, a former advisor to the late president Mitterrand, and the magistrate Georges Fenech were acquitted.
Dubai port firm says world trade starting to stabilize
Cargo handler DP World says trade volumes appear to be stabilizing after suffering their worst slump in decades because of the economic downturn.
The world's fourth-largest port operator says overall third-quarter cargo container volumes are down 6 percent over the same period a year earlier. That is a slower decline than the 10 percent drop the Dubai company reported in the first half. Despite expected challenges in the fourth quarter, the company says it is on track to meet market expectations.
Chief Executive Mohammed Sharaf called the third-quarter numbers encouraging, and says the company is "beginning to see early signs of stability across the industry."DP World runs ports in 32 countries worldwide.
The world's fourth-largest port operator says overall third-quarter cargo container volumes are down 6 percent over the same period a year earlier. That is a slower decline than the 10 percent drop the Dubai company reported in the first half. Despite expected challenges in the fourth quarter, the company says it is on track to meet market expectations.
Chief Executive Mohammed Sharaf called the third-quarter numbers encouraging, and says the company is "beginning to see early signs of stability across the industry."DP World runs ports in 32 countries worldwide.
October 26, 2009
Emirates begins Luanda-Dubai flights
The first non-stop Emirates service from Angola's capital Luanda arrived in Dubai in the early hours of Monday, amid hopes of expanding business links between the two countries.
Emirates will operate three flights a week with an Airbus A330-200 aircraft, connecting the oil-rich southern African nation with the Middle East, Europe and Asia. It hopes to cash in on the number of Asian labourers who work on Angolan construction sites, as well as other expatriates in Angola.
Non-oil trade between Angola and Dubai, a big exporter of cars to Angola, reached 800 million dollars (532.5 million euros) last year -- a growth of 1,200 percent in just four years.
"We know that Dubai and Angola have been moving ever closer in terms of growth of trade and we believe that with this route we will be able to strengthen that trade," said Nigel Page, Emirates' senior vice president for the Americas and Africa.
Angolan Transport Minister Augusto da Silva Tomas said: "An air link between two rapidly developing countries will enhance the growth potential between these nations. The reputation of the Emirates and its preference for Angola as a preferred destination in Africa, shows the huge interest in Angola awakens the world."
Luanda is Emirates' 18th destination in Africa. The South African coastal city of Durban was earlier added to its route map ahead of the 2010 football World Cup in June.In June 2007, Angola's national carrier TAAG was blacklisted by the European Commission due to poor safety standards and barred from EU airports. But in July this year it was approved to fly to Portugal using Boeing 777 aircraft.
Emirates will operate three flights a week with an Airbus A330-200 aircraft, connecting the oil-rich southern African nation with the Middle East, Europe and Asia. It hopes to cash in on the number of Asian labourers who work on Angolan construction sites, as well as other expatriates in Angola.
Non-oil trade between Angola and Dubai, a big exporter of cars to Angola, reached 800 million dollars (532.5 million euros) last year -- a growth of 1,200 percent in just four years.
"We know that Dubai and Angola have been moving ever closer in terms of growth of trade and we believe that with this route we will be able to strengthen that trade," said Nigel Page, Emirates' senior vice president for the Americas and Africa.
Angolan Transport Minister Augusto da Silva Tomas said: "An air link between two rapidly developing countries will enhance the growth potential between these nations. The reputation of the Emirates and its preference for Angola as a preferred destination in Africa, shows the huge interest in Angola awakens the world."
Luanda is Emirates' 18th destination in Africa. The South African coastal city of Durban was earlier added to its route map ahead of the 2010 football World Cup in June.In June 2007, Angola's national carrier TAAG was blacklisted by the European Commission due to poor safety standards and barred from EU airports. But in July this year it was approved to fly to Portugal using Boeing 777 aircraft.
Africa heading for 2009 growth due to China, says analyst
by Jonathan Lynn
All African economies except South Africa will grow this year because of China's demand for their raw materials, a leading South African analyst said on October 26. Out of 53 African states only the continent's biggest economy, South Africa, will not grow this year, Martyn Davies, executive director of Stellenbosch University's Centre for Chinese Studies, told a conference.
"Chinese demand is underpinning African growth," he told the conference on China, organised by the International Centre for Trade and Sustainable Development (ICTSD). Africa is already exporting 1 million barrels per day of oil to China, accounting for 25 percent of China's foreign energy supplies, said Davies, who is also chief executive of emerging market investment strategist Frontier Advisory.
These links are based on strong support by African leaders for Chinese investment in extractive industries -- in contrast to objections raised to Chinese investment in sensitive sectors in developed countries, he said. China's engagement in Africa -- where it is the biggest trading partner -- reflects both state enterprises benefiting from preferential capital from state banks, and private entrepreneurs, of whom around 1 million may now be in Africa, he said.
China's export prowess has so far failed to provoke much protectionism in Africa, except, again, in South Africa, where sensitive labour-intensive sectors such as textiles and light industry compete with Chinese firms.
Chinese imports from Africa come in at an average tariff of 0.64 percent -- almost the duty-free level sought by developing countries in rich markets -- because of China's eagerness to facilitate imports of African energy and commodities. Conversely, China faces considerable protectionist sentiment outside Africa, said Simon Evenett co-director of St Gallen University's Centre for Economic Policy Research.
According to Global Trade Alert, a website run by academics that Evenett co-founded, China is now the most targeted country for trade measures such as anti-dumping duties and safeguards, a trend likely to increase as the global economy and international trade recover, Evenett told the conference. "They can expect to be targeted even more. Now that world trade flows are increasing is perversely going to make it easier to demonstrate that Chinese imports are causing injury," he said.
Reuters
All African economies except South Africa will grow this year because of China's demand for their raw materials, a leading South African analyst said on October 26. Out of 53 African states only the continent's biggest economy, South Africa, will not grow this year, Martyn Davies, executive director of Stellenbosch University's Centre for Chinese Studies, told a conference.
"Chinese demand is underpinning African growth," he told the conference on China, organised by the International Centre for Trade and Sustainable Development (ICTSD). Africa is already exporting 1 million barrels per day of oil to China, accounting for 25 percent of China's foreign energy supplies, said Davies, who is also chief executive of emerging market investment strategist Frontier Advisory.
These links are based on strong support by African leaders for Chinese investment in extractive industries -- in contrast to objections raised to Chinese investment in sensitive sectors in developed countries, he said. China's engagement in Africa -- where it is the biggest trading partner -- reflects both state enterprises benefiting from preferential capital from state banks, and private entrepreneurs, of whom around 1 million may now be in Africa, he said.
China's export prowess has so far failed to provoke much protectionism in Africa, except, again, in South Africa, where sensitive labour-intensive sectors such as textiles and light industry compete with Chinese firms.
Chinese imports from Africa come in at an average tariff of 0.64 percent -- almost the duty-free level sought by developing countries in rich markets -- because of China's eagerness to facilitate imports of African energy and commodities. Conversely, China faces considerable protectionist sentiment outside Africa, said Simon Evenett co-director of St Gallen University's Centre for Economic Policy Research.
According to Global Trade Alert, a website run by academics that Evenett co-founded, China is now the most targeted country for trade measures such as anti-dumping duties and safeguards, a trend likely to increase as the global economy and international trade recover, Evenett told the conference. "They can expect to be targeted even more. Now that world trade flows are increasing is perversely going to make it easier to demonstrate that Chinese imports are causing injury," he said.
Reuters
Germany's MAN to build Volkswagen branded trucks, buses in South Africa
German truck and bus maker MAN SE will build Volkswagen branded trucks and buses in South Africa, starting in November, to tap into the wider sub-Saharan market. MAN, based in Munich, already has some operations in South Africa, but will now also build and market VW brands.
The move comes after it recently bought the Latin American truck and bus operations of Volkswagen. Volkswagen, based in Wolfsburg, holds about 30 percent of MAN, one of Europe's largest builders of heavy vehicles.
MAN said on October 25 it would build the Volkswagen branded Constellation truck series and the Volksbus series at its Pinetown plant near Durban, on the southeast coast. With demand expected to rise and inventories falling, MAN said the Pinetown assembly plant has the potential to double its production to about 3,200 units a year thanks to the introduction of the Constellation trucks and Volksbus chassis.
"MAN Latin America is known for its expertise in emerging markets, not only in product development but also in tailor-made sales and after sales," Roberto Cortes, the chief executive of MAN Latin America said in the statement. "The addition of MAN Commercial Vehicles' experience in South Africa and the entire sub-Saharan region will offer us synergies to conquer more markets and customers."
Washington Examiner
The move comes after it recently bought the Latin American truck and bus operations of Volkswagen. Volkswagen, based in Wolfsburg, holds about 30 percent of MAN, one of Europe's largest builders of heavy vehicles.
MAN said on October 25 it would build the Volkswagen branded Constellation truck series and the Volksbus series at its Pinetown plant near Durban, on the southeast coast. With demand expected to rise and inventories falling, MAN said the Pinetown assembly plant has the potential to double its production to about 3,200 units a year thanks to the introduction of the Constellation trucks and Volksbus chassis.
"MAN Latin America is known for its expertise in emerging markets, not only in product development but also in tailor-made sales and after sales," Roberto Cortes, the chief executive of MAN Latin America said in the statement. "The addition of MAN Commercial Vehicles' experience in South Africa and the entire sub-Saharan region will offer us synergies to conquer more markets and customers."
Washington Examiner
October 25, 2009
U.S. is losing control of the world's natural wealth to China
by Sahit Muja
China has an insatiable appetite for the world's natural resources to sustain an economic boom that powers ahead despite the global downturn. The quest for raw materials is the central goal of the country's foreign policy. And virtually every natural resource imaginable is found just over the border.
Russian far East have large reserves of natural gas, oil, diamonds and gold, while millions of square miles of birch and pine provide supplies of timber. All this amounts to an astonishing combination. A densely packed country trying to keep its economy roaring ahead by laying its hands on natural resources, living alongside a largely empty region with huge mineral wealth and fewer inhabitants every year.
Russia and China might operate a tactical alliance, but there is already tension between them over the Far East. Moscow is wary of large numbers of Chinese settlers moving into this region, bringing timber and mining companies in their wake.
China has moved aggressively to fill a vacuum left by the United States in recent years, as the U.S. focused on wars in Afghanistan and Iraq and the global economic crisis sapped its economy.
China is rising while the U.S. is declining in Latin America. China is all over this region. They are following a state-driven policy to expand their peaceful presence.
China is beefing up its embassies throughout Latin America, opening Confucian centers to expand Chinese culture, sending high-level trade delegations throughout the region and opening the door for ordinary Chinese to visit Machu Picchu, Rio and other tourism hot spots.
China Petrochemical Corp., the country’s second-biggest oil company, in June agreed to buy Geneva-based Addax Petroleum Corp. for $7.6 billion in China’s biggest overseas takeover to date. Purchasing Addax, which has oil reserves in Iraq’s Kurdish territory, shows Chinese oil companies are going for bigger transactions. These deals seem to reflect an appetite we have not seen before.
The world’s fastest-growing major economy consumes more than a third of the world’s aluminum output, a quarter of its copper production, almost a tenth of its oil and accounts for more than half of trading in iron ore. Last year, China bought $211 billion worth of iron ore, refined copper, crude oil and alumina, according to government data.
Australia has signed a record 41.3 billion US dollar deal to supply Chinese energy giant PetroChina with liquefied natural gas, officials said. The agreement, which represents the biggest foreign investment in Australia, is for PetroChina to buy 2.25 million tonnes a year over the next two decades from ExxonMobil's Gorgon gas field.
Industry analysts predict that Chinese-financed mergers and acquisitions this year will double their level of $52.1 bn. in 2008.
The Chinese are all over the place. China has launched its investment policy because of crippling pressure on its own natural resources in a country where the population has almost trebled from 500 million to 1.3 billion in 50 years.
China is hungry - for land, food and energy. While accounting for a fifth of the world's population, its oil consumption has risen in the past decade and Africa is now providing a third of it; imports of steel, copper and aluminum have also risen.
China is also desperate for new markets to sell goods. And Africa, with non-existent health and safety rules to protect against shoddy and dangerous goods, is the perfect destination. The result of China's demand for raw materials and its sales of products to Africa is that turnover in trade between Africa and China has risen to billions.
China is investing large amounts of money in Iran's energy sector. $70 billion is projected to be invested in gas and oil refineries there.
The Examiner
China has an insatiable appetite for the world's natural resources to sustain an economic boom that powers ahead despite the global downturn. The quest for raw materials is the central goal of the country's foreign policy. And virtually every natural resource imaginable is found just over the border.
Russian far East have large reserves of natural gas, oil, diamonds and gold, while millions of square miles of birch and pine provide supplies of timber. All this amounts to an astonishing combination. A densely packed country trying to keep its economy roaring ahead by laying its hands on natural resources, living alongside a largely empty region with huge mineral wealth and fewer inhabitants every year.
Russia and China might operate a tactical alliance, but there is already tension between them over the Far East. Moscow is wary of large numbers of Chinese settlers moving into this region, bringing timber and mining companies in their wake.
China has moved aggressively to fill a vacuum left by the United States in recent years, as the U.S. focused on wars in Afghanistan and Iraq and the global economic crisis sapped its economy.
China is rising while the U.S. is declining in Latin America. China is all over this region. They are following a state-driven policy to expand their peaceful presence.
China is beefing up its embassies throughout Latin America, opening Confucian centers to expand Chinese culture, sending high-level trade delegations throughout the region and opening the door for ordinary Chinese to visit Machu Picchu, Rio and other tourism hot spots.
China Petrochemical Corp., the country’s second-biggest oil company, in June agreed to buy Geneva-based Addax Petroleum Corp. for $7.6 billion in China’s biggest overseas takeover to date. Purchasing Addax, which has oil reserves in Iraq’s Kurdish territory, shows Chinese oil companies are going for bigger transactions. These deals seem to reflect an appetite we have not seen before.
The world’s fastest-growing major economy consumes more than a third of the world’s aluminum output, a quarter of its copper production, almost a tenth of its oil and accounts for more than half of trading in iron ore. Last year, China bought $211 billion worth of iron ore, refined copper, crude oil and alumina, according to government data.
Australia has signed a record 41.3 billion US dollar deal to supply Chinese energy giant PetroChina with liquefied natural gas, officials said. The agreement, which represents the biggest foreign investment in Australia, is for PetroChina to buy 2.25 million tonnes a year over the next two decades from ExxonMobil's Gorgon gas field.
Industry analysts predict that Chinese-financed mergers and acquisitions this year will double their level of $52.1 bn. in 2008.
The Chinese are all over the place. China has launched its investment policy because of crippling pressure on its own natural resources in a country where the population has almost trebled from 500 million to 1.3 billion in 50 years.
China is hungry - for land, food and energy. While accounting for a fifth of the world's population, its oil consumption has risen in the past decade and Africa is now providing a third of it; imports of steel, copper and aluminum have also risen.
China is also desperate for new markets to sell goods. And Africa, with non-existent health and safety rules to protect against shoddy and dangerous goods, is the perfect destination. The result of China's demand for raw materials and its sales of products to Africa is that turnover in trade between Africa and China has risen to billions.
China is investing large amounts of money in Iran's energy sector. $70 billion is projected to be invested in gas and oil refineries there.
The Examiner
1. Some are unhappy about China's expansion in Africa
2. Chinese products are 'cheap but often a little bit nasty'
3. Egyptian equity fund eyes investments in Kenya, Uganda
4. Chinese diplomat defends country's role in Africa
5. Debunking the cult of free trade
6. China-Guinea deal highlights Africa business ties
7. COMESA to craft simpler rules for small scale traders
8. ECOWAS trade bloc suspends Niger
2. Chinese products are 'cheap but often a little bit nasty'
3. Egyptian equity fund eyes investments in Kenya, Uganda
4. Chinese diplomat defends country's role in Africa
5. Debunking the cult of free trade
6. China-Guinea deal highlights Africa business ties
7. COMESA to craft simpler rules for small scale traders
8. ECOWAS trade bloc suspends Niger
Some are unhappy about China's expansion in Africa
By Daniel Howden
More than a dozen Liberians are expected at the Samuel Doe sports stadium in the capital, Monrovia. In a makeshift classroom with some plastic chairs and a whiteboard their teacher, Li Peng, is waiting to finish the group's second week of instruction in Mandarin Chinese.
Early attendances at the free daily lessons provided by the Chinese embassy have been poor, but officials are blaming heavy rain rather than light interest. The class is still struggling with the basics and few Chinese listeners apart from their teacher would recognise the strange "hellos" and "goodbyes" being called out.
"Learning Chinese may prove difficult," Mr Li admitted. "But if they work hard they will make it."
The West African country set up to settle freed American slaves in 1843 is English-speaking and the going is hard.John Cooper, a 57-year-old who has been attending the two-hour classes and works at a nearby youth centre, is determined to master Mandarin. "Traditionally, we Liberians are closer to the Americans than we are to the Chinese," he says. "But the irony is that the Chinese are more open to us than the Americans are."
Liberia's government has no Mandarin speakers, and China's ambassador, Zhou Yuxiao, admits that he's uncomfortable that multibillion-dollar accords between the two countries are signed with one side unable to read the documents. "We feel a little bit guilty at not being able to help Liberians to speak our language," he told the Associated Press.
On the same day that the Mandarin lessons were getting under way at the stadium in Monrovia, a much larger crowd was gathering about 300 miles to the northwest at another sports stadium, this time in Conakry, the capital of Guinea. The people had gathered to protest against the military junta and a young army officer, Moussa Dadis Camara, who with wearying predictability has been considering going back on earlier promises to hold free elections. While Liberian students were grappling with Mandarin vowels more than 150 Guineans were being murdered. Scores of women were then raped. The massacre prompted international outrage, and the African Union met to discuss possible sanctions.
But it was revealed last week that China was preparing to throw the regime a lifeline in the form of nearly £4.3bn in oil and minerals deals. It has left many wondering which is the real face of China in Africa: is it the quest for understanding being led by Mr Li in Monrovia? Or the naked pursuit of raw materials whose sale props up abusive governments like the one in Conakry?
China's engagement in Africa was supposed to have changed, experts say. Beijing's doctrine of "non-interference" in the domestic affairs of other countries was put to one side last year as it helped to nudge Sudan, one of its major oil suppliers, into allowing a beefed-up UN peacekeeping operation in Darfur. Then on a visit earlier this year China's president, Hu Jintao, signalled Beijing's intent to double aid to Africa.
According to Ian Taylor, a senior lecturer in international affairs at the University of St Andrews, the apparent contradiction is the product of a "clueless" approach to Beijing – "a tendency to treat China as if it's 'China Inc'." Speaking from Beijing, he said: "There is no one Chinese policy towards Africa – it is a mixture of often-competing actors and influences that may or may not gel with official policy."
Chinese trade with Africa has grown from less than £6.3bn at the beginning of the decade to pass £60bn at the end of last year – only the European Union and the US do more business. There are now some 800 Chinese companies operating in Africa and the investors in talks in Conakry are not from Beijing but from the Hong Kong-based China Investment Fund. Yet only two months ago officials in Beijing said that China would not be investing in Guinea.
"It's not clear if the CIF has the support of Beijing," said Dr Chris Alden, author of China in Africa. "Just like ordinary Western actors in Africa, China has independent actors who take decisions without reference to central government."
And some analysts suggest China's no-strings-attached approach in pariah states like Sudan and Zimbabwe is not the whole story. Some 25 years after Band-Aid seared Ethiopia into the Western consciousness and conscience, China's engagement with Addis Ababa may say more about the Sino-African relationship. Whatever the achievements or shortcomings of famine-inspired aid in the Horn of Africa nation, they are being dwarfed by the Chinese-backed transformation of the country. Ethiopia boasts none of the reservoirs of raw materials China is normally associated with, but Beijing has been doling out the credit to build roads and hydroelectric dams and is now financing a £940m expansion of the state-owned mobile telephone network.
In a recent paper for The South African Institute of International Affairs, Dr Monika Thakur found China's role in Ethiopia contradicted the spectre of the hungry dragon invoked by some in the West. "China's activities in Ethiopia, and in Africa in general, are part of its continuing emergence as a global power, and as such are no different from what major powers traditionally have done," she wrote. "Overarching judgements as to whether China's engagement is a blessing or a curse for Ethiopia are still unclear. What is certain is that the country can derive much from China's economic engagement."
The government in Addis Ababa has enjoyed the increased influence over Western donors that Chinese help has afforded. "I think it would be wrong for people in the West to assume that they can buy good governance in Africa; good governance can only come from inside," Ethiopia's prime minister, Meles Zenawi, told the Financial Times recently. "What the Chinese have done is explode that illusion."
Mr Zenawi's government does not attract headlines in the way that Sudan's Omar al-Bashir does, but his administration has overseen the violent suppression of opposition in the wake of disputed elections. And he has since jailed popular opponents, such as opposition leader Birtukan Mideksa. Dr Thakur warns that Addis Ababa could use Chinese assistance to avoid change – which could lead to "authoritarian stagnation."
However, China's own emergence as a great power, and the legitimacy of the one-party rule in Beijing, has been based on economic growth. Those looking for a champion of human or political rights are likely to be disappointed.
"The jury is still out on the significance of China's actions on Darfur," argues Dr Alden. "It's up to Africans to decide if China is having a positive or negative impact on rights in Africa. On the whole China is having a fairly neutral impact – it's really more about economic development."
More than a dozen Liberians are expected at the Samuel Doe sports stadium in the capital, Monrovia. In a makeshift classroom with some plastic chairs and a whiteboard their teacher, Li Peng, is waiting to finish the group's second week of instruction in Mandarin Chinese.
Early attendances at the free daily lessons provided by the Chinese embassy have been poor, but officials are blaming heavy rain rather than light interest. The class is still struggling with the basics and few Chinese listeners apart from their teacher would recognise the strange "hellos" and "goodbyes" being called out.
"Learning Chinese may prove difficult," Mr Li admitted. "But if they work hard they will make it."
The West African country set up to settle freed American slaves in 1843 is English-speaking and the going is hard.John Cooper, a 57-year-old who has been attending the two-hour classes and works at a nearby youth centre, is determined to master Mandarin. "Traditionally, we Liberians are closer to the Americans than we are to the Chinese," he says. "But the irony is that the Chinese are more open to us than the Americans are."
Liberia's government has no Mandarin speakers, and China's ambassador, Zhou Yuxiao, admits that he's uncomfortable that multibillion-dollar accords between the two countries are signed with one side unable to read the documents. "We feel a little bit guilty at not being able to help Liberians to speak our language," he told the Associated Press.
On the same day that the Mandarin lessons were getting under way at the stadium in Monrovia, a much larger crowd was gathering about 300 miles to the northwest at another sports stadium, this time in Conakry, the capital of Guinea. The people had gathered to protest against the military junta and a young army officer, Moussa Dadis Camara, who with wearying predictability has been considering going back on earlier promises to hold free elections. While Liberian students were grappling with Mandarin vowels more than 150 Guineans were being murdered. Scores of women were then raped. The massacre prompted international outrage, and the African Union met to discuss possible sanctions.
But it was revealed last week that China was preparing to throw the regime a lifeline in the form of nearly £4.3bn in oil and minerals deals. It has left many wondering which is the real face of China in Africa: is it the quest for understanding being led by Mr Li in Monrovia? Or the naked pursuit of raw materials whose sale props up abusive governments like the one in Conakry?
China's engagement in Africa was supposed to have changed, experts say. Beijing's doctrine of "non-interference" in the domestic affairs of other countries was put to one side last year as it helped to nudge Sudan, one of its major oil suppliers, into allowing a beefed-up UN peacekeeping operation in Darfur. Then on a visit earlier this year China's president, Hu Jintao, signalled Beijing's intent to double aid to Africa.
According to Ian Taylor, a senior lecturer in international affairs at the University of St Andrews, the apparent contradiction is the product of a "clueless" approach to Beijing – "a tendency to treat China as if it's 'China Inc'." Speaking from Beijing, he said: "There is no one Chinese policy towards Africa – it is a mixture of often-competing actors and influences that may or may not gel with official policy."
Chinese trade with Africa has grown from less than £6.3bn at the beginning of the decade to pass £60bn at the end of last year – only the European Union and the US do more business. There are now some 800 Chinese companies operating in Africa and the investors in talks in Conakry are not from Beijing but from the Hong Kong-based China Investment Fund. Yet only two months ago officials in Beijing said that China would not be investing in Guinea.
"It's not clear if the CIF has the support of Beijing," said Dr Chris Alden, author of China in Africa. "Just like ordinary Western actors in Africa, China has independent actors who take decisions without reference to central government."
And some analysts suggest China's no-strings-attached approach in pariah states like Sudan and Zimbabwe is not the whole story. Some 25 years after Band-Aid seared Ethiopia into the Western consciousness and conscience, China's engagement with Addis Ababa may say more about the Sino-African relationship. Whatever the achievements or shortcomings of famine-inspired aid in the Horn of Africa nation, they are being dwarfed by the Chinese-backed transformation of the country. Ethiopia boasts none of the reservoirs of raw materials China is normally associated with, but Beijing has been doling out the credit to build roads and hydroelectric dams and is now financing a £940m expansion of the state-owned mobile telephone network.
In a recent paper for The South African Institute of International Affairs, Dr Monika Thakur found China's role in Ethiopia contradicted the spectre of the hungry dragon invoked by some in the West. "China's activities in Ethiopia, and in Africa in general, are part of its continuing emergence as a global power, and as such are no different from what major powers traditionally have done," she wrote. "Overarching judgements as to whether China's engagement is a blessing or a curse for Ethiopia are still unclear. What is certain is that the country can derive much from China's economic engagement."
The government in Addis Ababa has enjoyed the increased influence over Western donors that Chinese help has afforded. "I think it would be wrong for people in the West to assume that they can buy good governance in Africa; good governance can only come from inside," Ethiopia's prime minister, Meles Zenawi, told the Financial Times recently. "What the Chinese have done is explode that illusion."
Mr Zenawi's government does not attract headlines in the way that Sudan's Omar al-Bashir does, but his administration has overseen the violent suppression of opposition in the wake of disputed elections. And he has since jailed popular opponents, such as opposition leader Birtukan Mideksa. Dr Thakur warns that Addis Ababa could use Chinese assistance to avoid change – which could lead to "authoritarian stagnation."
However, China's own emergence as a great power, and the legitimacy of the one-party rule in Beijing, has been based on economic growth. Those looking for a champion of human or political rights are likely to be disappointed.
"The jury is still out on the significance of China's actions on Darfur," argues Dr Alden. "It's up to Africans to decide if China is having a positive or negative impact on rights in Africa. On the whole China is having a fairly neutral impact – it's really more about economic development."
Chinese products are 'cheap but often a little bit nasty'
Thai consumers are becoming increasingly concerned over the safety of Chinese products after a number of highly publicised scares, ranging from toxic food and melamine-tainted milk products to fake medicines and toys coloured with lead paint. China is the second largest exporter to Thailand after Japan. And since the Asean-China free trade agreement took effect in 2003, granting tariff exemptions on farm products, there has been an influx of food imports from China into Thailand.
In 2007, the Food and Drug Administration (FDA) blacklisted a large number of Chinese vegetables, fruits and food products which had been imported since 2004 after tests revealed they were contaminated with toxic chemicals. The trade pact will take full effect in January, wiping out tariffs on a wider range of products.
So are the safety scares of recent years a taste of things to come? Trade observers say low-cost Chinese imports will flood local stores. But they said shoppers should embrace the new influx of cheap goods with caution as state supervision of product quality was poor in both China and Thailand and drastic changes were unlikely to take place any time soon.
"There will be more Chinese imports available in Thai markets next year," said Aksornsri Phanishsarn, an economist at Thammasat University. The trade pact will grant tariff exemptions for about 5,000 consumer products and capital goods, she said.
China has been condemned internationally for exporting shoddy and dangerous products. Permanent secretary for public health Paijit Warachit criticised China for its poor food production processes when he was chief of the Department of Medical Science. The Chinese government in June implemented the Food Safety Law in an attempt to better regulate and supervise the country's manufacturing sector. But the sheer number of firms in China makes it hard for authorities to uphold heath and safety standards.
Public Health Ministry officials, speaking on condition of anonymity, recently said Thai authorities had failed to prevent unsafe Chinese imports from entering the country through northern border crossings due to the sloppy work of customs and FDA officials and because of insufficient technological support. Limited resources and equipment have led to a lot of unsafe products entering the local market, they said.
Earlier this month, police raids in Bangkok netted plastic toys from China which expand when wet and have been identified as a risk to children who might swallow them. The toys have been banned from sale here but retailers say the imports keep coming.
But not all Chinese products are low quality, Mrs Aksornsri said. "The problem of substandard quality is normally found in low-cost goods which have been targeted by importers who see a chance to attract cost-conscious consumers," she said. "The key problem lies with lax supervision by our regulators." Thai customs and FDA officials need to tighten controls at border crossings and ports, she said. "Our regulators need to be tougher on imported products without worrying that such a stance would trigger a trade war or upset trade partners," she said.
Narangsant Pheerakij, the FDA's deputy secretary-general, said his agency could not prevent unsafe imports from entering Thailand. "We are incapable of conducting inspections and tests of all imports because there are loads of them," he said. The FDA lacks the funds to carry out full border inspections and only has about 20 officials at its Bangkok head office and a few at each of the 35 customs ports nationwide, he said. Light penalties for importing substandard goods provide no real deterrent, he said. The law should be amended to impose more severe penalties and to increase the control of food products. It would help if the government had resident officials in key importing countries, including China, to conduct inspections at point of origin, he said.
Consumers should look for the FDA label when buying an imported product, he said. The agency also hopes Thai importers will take more responsibility over the safety of their products. The agency was criticised for its handling of the melamine scandal last year. It first told the public that all milk products were safe, but then revealed that numerous products were contaminated.
Jacque-chai Chomthongdee of FTA Watch, a civil pressure group, said agencies' poor efforts to tackle the unsafe import problem was a key issue. "There are problems relating to which agencies should take a lead in quality control," he said. High-level free trade talks had not included requirements for product quality, he said. It would also be difficult to pressure China politically over the matter because Thailand has not applied stringent enough quality standards on its own exports, he said. "After entering the free trade deal, Thailand should place a higher priority on the quality of [imported and exported] products to protect the welfare of its consumers," he said.
In 2007, the Food and Drug Administration (FDA) blacklisted a large number of Chinese vegetables, fruits and food products which had been imported since 2004 after tests revealed they were contaminated with toxic chemicals. The trade pact will take full effect in January, wiping out tariffs on a wider range of products.
So are the safety scares of recent years a taste of things to come? Trade observers say low-cost Chinese imports will flood local stores. But they said shoppers should embrace the new influx of cheap goods with caution as state supervision of product quality was poor in both China and Thailand and drastic changes were unlikely to take place any time soon.
"There will be more Chinese imports available in Thai markets next year," said Aksornsri Phanishsarn, an economist at Thammasat University. The trade pact will grant tariff exemptions for about 5,000 consumer products and capital goods, she said.
China has been condemned internationally for exporting shoddy and dangerous products. Permanent secretary for public health Paijit Warachit criticised China for its poor food production processes when he was chief of the Department of Medical Science. The Chinese government in June implemented the Food Safety Law in an attempt to better regulate and supervise the country's manufacturing sector. But the sheer number of firms in China makes it hard for authorities to uphold heath and safety standards.
Public Health Ministry officials, speaking on condition of anonymity, recently said Thai authorities had failed to prevent unsafe Chinese imports from entering the country through northern border crossings due to the sloppy work of customs and FDA officials and because of insufficient technological support. Limited resources and equipment have led to a lot of unsafe products entering the local market, they said.
Earlier this month, police raids in Bangkok netted plastic toys from China which expand when wet and have been identified as a risk to children who might swallow them. The toys have been banned from sale here but retailers say the imports keep coming.
But not all Chinese products are low quality, Mrs Aksornsri said. "The problem of substandard quality is normally found in low-cost goods which have been targeted by importers who see a chance to attract cost-conscious consumers," she said. "The key problem lies with lax supervision by our regulators." Thai customs and FDA officials need to tighten controls at border crossings and ports, she said. "Our regulators need to be tougher on imported products without worrying that such a stance would trigger a trade war or upset trade partners," she said.
Narangsant Pheerakij, the FDA's deputy secretary-general, said his agency could not prevent unsafe imports from entering Thailand. "We are incapable of conducting inspections and tests of all imports because there are loads of them," he said. The FDA lacks the funds to carry out full border inspections and only has about 20 officials at its Bangkok head office and a few at each of the 35 customs ports nationwide, he said. Light penalties for importing substandard goods provide no real deterrent, he said. The law should be amended to impose more severe penalties and to increase the control of food products. It would help if the government had resident officials in key importing countries, including China, to conduct inspections at point of origin, he said.
Consumers should look for the FDA label when buying an imported product, he said. The agency also hopes Thai importers will take more responsibility over the safety of their products. The agency was criticised for its handling of the melamine scandal last year. It first told the public that all milk products were safe, but then revealed that numerous products were contaminated.
Jacque-chai Chomthongdee of FTA Watch, a civil pressure group, said agencies' poor efforts to tackle the unsafe import problem was a key issue. "There are problems relating to which agencies should take a lead in quality control," he said. High-level free trade talks had not included requirements for product quality, he said. It would also be difficult to pressure China politically over the matter because Thailand has not applied stringent enough quality standards on its own exports, he said. "After entering the free trade deal, Thailand should place a higher priority on the quality of [imported and exported] products to protect the welfare of its consumers," he said.
Egyptian equity fund eyes investments in Kenya, Uganda
by Alexander Dziadosz
Egypt-based private equity firm Citadel Capital is considering investing in Kenya and Uganda in the next six to 12 months, an executive said on October 25. Citadel, which has investments worth $8.3 billion, previously said it planned to invest $200 million to $400 million in 2010, with an eye on Africa.
"We're spending some time in Kenya, we're spending some time in Uganda, and hence, I think these are the places we'll invest in next, naturally," Managing Director Abdalla El Ebiary said on the sidelines of a conference on private equity in Africa. "Probably in six to 12 months, you'll hear of a new investment," he said.
Ebiary declined to elaborate on the East African projects until any deals were complete, but added that the firm was considering expanding into new sectors.
Citadel invests across the Middle East and North Africa through 19 platform companies in sectors including energy, mining, agriculture and cement. "The growth rates in Africa are extremely attractive. One of the statistics that really interested me is that Africa is going to grow at four percent next year, which will be the fastest-growing continent," Ebiary said. "We're looking at new industries where we can come in and play," he said.
Stephen Murphy, managing director of institutional fundraising, said the firm had eyed agriculture and infrastructure investments in Uganda. "Logistics across Africa is an area we're very interested in, and you'll see us do more," Murphy added. Citadel's investments include a company developing Nile river barges and ports.
Reuters
Egypt-based private equity firm Citadel Capital is considering investing in Kenya and Uganda in the next six to 12 months, an executive said on October 25. Citadel, which has investments worth $8.3 billion, previously said it planned to invest $200 million to $400 million in 2010, with an eye on Africa.
"We're spending some time in Kenya, we're spending some time in Uganda, and hence, I think these are the places we'll invest in next, naturally," Managing Director Abdalla El Ebiary said on the sidelines of a conference on private equity in Africa. "Probably in six to 12 months, you'll hear of a new investment," he said.
Ebiary declined to elaborate on the East African projects until any deals were complete, but added that the firm was considering expanding into new sectors.
Citadel invests across the Middle East and North Africa through 19 platform companies in sectors including energy, mining, agriculture and cement. "The growth rates in Africa are extremely attractive. One of the statistics that really interested me is that Africa is going to grow at four percent next year, which will be the fastest-growing continent," Ebiary said. "We're looking at new industries where we can come in and play," he said.
Stephen Murphy, managing director of institutional fundraising, said the firm had eyed agriculture and infrastructure investments in Uganda. "Logistics across Africa is an area we're very interested in, and you'll see us do more," Murphy added. Citadel's investments include a company developing Nile river barges and ports.
Reuters
October 24, 2009
Chinese diplomat defends country's role in Africa
by Xiao Jun*
After reading two recent articles about China in the Bangkok Post, ''Cheap but often a little bit nasty'' and ''Money and Mandarin lessons fuel China's African invasion'' from the Oct 17 and 18 editions, respectively, I regrettably found the authors' observations towards China's food safety and cooperation with Africa lacking. In this regard, I am obliged to provide some points of fact.
China attaches great importance and works hard to ensure food safety, not only for the Chinese people but also for the people of other countries who take food made in China. A complete industrial chain of food production from farm to table has been established in China. The food safety law which went into effect on June 1, 2009, is further strengthening China's food safety management. The latest statistics show that 99% of China's exported food items meet quality standards.
No industry is immune from risk. There were problems with certain Chinese food enterprises caused by illegal export activities and negligence of food quality control. But one enterprise's problem does not constitute a country-wide problem, and certain food products found below standard does not mean the whole country's food is unsafe. Exaggerating China's food safety problems will lead consumers to nowhere and stir panic.
Concerning China's ''African invasion'', the truth speaks loudly. In 2008, China-Africa trade volume stood at US$106.8 billion. China's exports to Africa were at $50.84 billion while Africa's exports to China totalled a bit more - $56 billion. Is this an ''invasion''?
China has adopted various policies and measures to enhance the competitiveness of African products, promote Africa's exports to China and change the pattern of bilateral trade between China and Africa. The Chinese government also encourages and supports Chinese enterprises to construct schools, stadium, roads, bridges and railways in African countries, to help those countries to realise sustainable development and contribute to the continent's development as a whole.
China provides various forms of assistance to African countries, including grants, interest-free loans and concessional loans. China focuses its assistance on strengthening cooperation in agriculture, infrastructure, human resources training and public health. In 2006, the Chinese government announced its decision to exempt 33 heavily indebted and least developed countries in Africa of their interest-free debts owed to China. China will also continue to support African countries in their conflict prevention and peace building endeavours.
*Chinese Embassy, Thailand
Debunking the cult of free trade
by Rampart White
I am a bit baffled as to why the Bangkok Post continues to press forward with its solicitation of the virtues of free trade ideology. Are we really, in all earnestness, still talking about this debunked cult?
If trade between the Asean bloc were any more free we may as well do away with legislation and state management altogether. Why even bother with an anti-corruption committee? Just turn everything over to the benevolent custodians in the private sector.
The briefest review of the past two decades of trade policy will illustrate that the proponents of the free market doctrine have had their way. Indeed, we've tried that already. In periods when it wasn't so voluntary it was strong-armed by the ''Washington Consensus,'' as in the wake of the 1997 Asian crisis when Thai assets were handed over to Western foreign investors such as the Carlyle group.
The devastating failure of the free trade mentality is manifest in its many rotten fruits. That the recent international financial meltdown has failed to clearly expose this hoax for what it is, even to its most rabid supporters, is shocking.
It is clear that free market principles only benefit the few in the corporate world and those that pave its way, at the public's expense. Please let us just bury this discredited philosophy, enough damage has been done in its name. The ''free transfer of knowledge'' will continue to flow in its absence.Bangkok Post
I am a bit baffled as to why the Bangkok Post continues to press forward with its solicitation of the virtues of free trade ideology. Are we really, in all earnestness, still talking about this debunked cult?
If trade between the Asean bloc were any more free we may as well do away with legislation and state management altogether. Why even bother with an anti-corruption committee? Just turn everything over to the benevolent custodians in the private sector.
The briefest review of the past two decades of trade policy will illustrate that the proponents of the free market doctrine have had their way. Indeed, we've tried that already. In periods when it wasn't so voluntary it was strong-armed by the ''Washington Consensus,'' as in the wake of the 1997 Asian crisis when Thai assets were handed over to Western foreign investors such as the Carlyle group.
The devastating failure of the free trade mentality is manifest in its many rotten fruits. That the recent international financial meltdown has failed to clearly expose this hoax for what it is, even to its most rabid supporters, is shocking.
It is clear that free market principles only benefit the few in the corporate world and those that pave its way, at the public's expense. Please let us just bury this discredited philosophy, enough damage has been done in its name. The ''free transfer of knowledge'' will continue to flow in its absence.Bangkok Post
China-Guinea deal highlights Africa business ties
by Christopher Bodeen
A $7 billion mining deal between Guinea's repressive military regime and a little-known Chinese company underscores China's full-throttle rush into Africa and its willingness to deal with brutal and corrupt governments. The deal announced by the West African country's military junta offers the company, China International Fund, access to Guinea's bauxite and other minerals and could provide major revenues to a government facing international isolation.
Guinea's soldiers opened fire on demonstrators late last month, killing up to 157, and raped women in public. Human rights groups decried the pact. China's government has declined to confirm it or answer related questions, and the company also refused to comment.
In many ways, the Guinea deal reflects established Chinese business practices in Africa, characterized by huge investments in a still-poor continent but also secrecy and often scant regard for labor and human rights. China's defenders point out that other investors from the West, Japan, India and elsewhere are also major economic partners with less-than-democratic African governments.
In Guinea, Alcoa of the United States and Anglo-Australian Rio Tinto PLC are already major players in the bauxite business. Also, China has given aid, loans or investment to more than 17 African nations, some of which do have democratic governments. But China's practices have raised questions about whether the huge sums will hamper the progress of human rights and good governance in Africa, even as they raise the standards of living and line the pockets of some.
China has given large chunks of money to corrupt and abusive regimes such as those in oil-rich Nigeria and Sudan, much criticized over abuses in the Darfur region. For example, China has a controversial $9 billion agreement with violence-plagued Congo.
"There's obviously mixed emotions with regard to China-Africa relations," said Kellie Jane Whitlock, of the South African magazine Corporate Africa. Unlike companies from the recession-struck West, there are "Chinese companies that are still growing and looking into investing further into Africa," Whitlock said. The Chinese are "quite inclined to look after their investment and build their investment. They are serious about investing in Africa."
Scrutiny and mixed emotions are rising in Africa as the volume of China's dealings soar. Trade has soared 10 times since 2001, passing the $100 billion-mark last year. Estimates of Chinese investment in Africa range upward from $6 billion as China tries to lock up oil, gas, and other key resources for its resource-hungry economy. Estimates for total loans, investment and aid donations — often difficult to distinguish from each other — run closer to $50 billion.
Hong Kong-registered China International Fund has done big deals with another undemocratic African government: Angola. The company, known as CIF, is building housing, highways and the capital's airport in Angola, which is one of China's leading suppliers of oil. CIF is a private company, though its ultimate ownership is unclear. But in embarking on these deals, it can count on high-level access to leading Angolan officials and a web of contacts to China's state-backed industries and companies, especially the Export-Import Bank of China, which funds many of the country's major overseas investments. CIF's directors are also believed to have ties to China's military and security forces, boosting their relationships with the country's communist leadership.
In the case of China International Fund and Guinea, it isn't known whether the company was working on the deal before December's coup that brought Capt. Moussa "Dadis" Camara to power. The British think-tank Chatham House recently reported that CIF had been working on a $1.6 billion investment plan for the country spanning infrastructure, housing, mining, transport, tourism, and food production. In exchange, the company would theoretically gain access to Guinea's plentiful deposits of bauxite, the raw material used to make aluminum, along with diamonds and gold.
Mines Minister Mahmoud Thiam said the Chinese company "will be a strategic partner in all mining projects." Thiam also said that new power-generating plants, railway links, and planes for both international and local air transportation are part of the deal.
Founded in 2003, CIF appears to be among the boldest — and best connected — of the Chinese investors in Africa. The company's Hong Kong business registration lists it as 99 percent owned by Dayuan International Development Limited, identified by Chatham House analysts as the parent company of China Angola Oil Stock Holding Ltd., which exports Angolan oil to China. The remaining 1 percent is owned by CIF's chairwoman, Lo Fong Hung, who is also one of Dayuan's four directors and whose husband, according to Chatham House, has been a director of the Chinese government's two biggest investment arms.
CIF has become a broker for huge infrastructure projects in Angola, tapping financing from China's Exim Bank and secured by the African nation's oil revenues. Among the company's projects: 215,500 housing units totaling more than 333 million square feet (31 million square meters); the restoration of 1,000 miles (1,600 kilometers) of highway and 1,665 miles (2,680 kilometers) of railway; and the construction of the capital's new airport. Many of those remain in the planning stages, however, and some have run aground.
Chinese media reports say other Chinese subcontractors have complained that CIF was failing to pay for work and materials supplied for some other African construction projects. "Some projects have been slow to get off the ground, and there are bottlenecks," said Chatham House's Weimer. "They are not delivering on their timelines."
A receptionist who answered the phone at its Beijing office said she had no information about the Guinea mining deal and there was no one available to comment. A woman who answered the phone at the fund's Hong Kong office declined to comment and there was no response to questions faxed to the office.
Despite CIF's deep connections to the government, "Africa expert" Stephen Morrisson said the company likely hatched the deal on its own, without excessive Chinese government involvement. "Often these decisions are taken quite independently and often there is little internal policy coordination or deliberation," said Morrisson, of the Center for Strategic and International Studies in Washington. He also questioned reports characterizing the deal as a "lifeline" to the Guinean regime, saying the leadership likely lacked the wherewithal to fully see it through."Overall, I don't think this will rescue the current miserable crowd attempting to rule Guinea," Morrisson said.
A $7 billion mining deal between Guinea's repressive military regime and a little-known Chinese company underscores China's full-throttle rush into Africa and its willingness to deal with brutal and corrupt governments. The deal announced by the West African country's military junta offers the company, China International Fund, access to Guinea's bauxite and other minerals and could provide major revenues to a government facing international isolation.
Guinea's soldiers opened fire on demonstrators late last month, killing up to 157, and raped women in public. Human rights groups decried the pact. China's government has declined to confirm it or answer related questions, and the company also refused to comment.
In many ways, the Guinea deal reflects established Chinese business practices in Africa, characterized by huge investments in a still-poor continent but also secrecy and often scant regard for labor and human rights. China's defenders point out that other investors from the West, Japan, India and elsewhere are also major economic partners with less-than-democratic African governments.
In Guinea, Alcoa of the United States and Anglo-Australian Rio Tinto PLC are already major players in the bauxite business. Also, China has given aid, loans or investment to more than 17 African nations, some of which do have democratic governments. But China's practices have raised questions about whether the huge sums will hamper the progress of human rights and good governance in Africa, even as they raise the standards of living and line the pockets of some.
China has given large chunks of money to corrupt and abusive regimes such as those in oil-rich Nigeria and Sudan, much criticized over abuses in the Darfur region. For example, China has a controversial $9 billion agreement with violence-plagued Congo.
"There's obviously mixed emotions with regard to China-Africa relations," said Kellie Jane Whitlock, of the South African magazine Corporate Africa. Unlike companies from the recession-struck West, there are "Chinese companies that are still growing and looking into investing further into Africa," Whitlock said. The Chinese are "quite inclined to look after their investment and build their investment. They are serious about investing in Africa."
Scrutiny and mixed emotions are rising in Africa as the volume of China's dealings soar. Trade has soared 10 times since 2001, passing the $100 billion-mark last year. Estimates of Chinese investment in Africa range upward from $6 billion as China tries to lock up oil, gas, and other key resources for its resource-hungry economy. Estimates for total loans, investment and aid donations — often difficult to distinguish from each other — run closer to $50 billion.
Hong Kong-registered China International Fund has done big deals with another undemocratic African government: Angola. The company, known as CIF, is building housing, highways and the capital's airport in Angola, which is one of China's leading suppliers of oil. CIF is a private company, though its ultimate ownership is unclear. But in embarking on these deals, it can count on high-level access to leading Angolan officials and a web of contacts to China's state-backed industries and companies, especially the Export-Import Bank of China, which funds many of the country's major overseas investments. CIF's directors are also believed to have ties to China's military and security forces, boosting their relationships with the country's communist leadership.
In the case of China International Fund and Guinea, it isn't known whether the company was working on the deal before December's coup that brought Capt. Moussa "Dadis" Camara to power. The British think-tank Chatham House recently reported that CIF had been working on a $1.6 billion investment plan for the country spanning infrastructure, housing, mining, transport, tourism, and food production. In exchange, the company would theoretically gain access to Guinea's plentiful deposits of bauxite, the raw material used to make aluminum, along with diamonds and gold.
Mines Minister Mahmoud Thiam said the Chinese company "will be a strategic partner in all mining projects." Thiam also said that new power-generating plants, railway links, and planes for both international and local air transportation are part of the deal.
Founded in 2003, CIF appears to be among the boldest — and best connected — of the Chinese investors in Africa. The company's Hong Kong business registration lists it as 99 percent owned by Dayuan International Development Limited, identified by Chatham House analysts as the parent company of China Angola Oil Stock Holding Ltd., which exports Angolan oil to China. The remaining 1 percent is owned by CIF's chairwoman, Lo Fong Hung, who is also one of Dayuan's four directors and whose husband, according to Chatham House, has been a director of the Chinese government's two biggest investment arms.
CIF has become a broker for huge infrastructure projects in Angola, tapping financing from China's Exim Bank and secured by the African nation's oil revenues. Among the company's projects: 215,500 housing units totaling more than 333 million square feet (31 million square meters); the restoration of 1,000 miles (1,600 kilometers) of highway and 1,665 miles (2,680 kilometers) of railway; and the construction of the capital's new airport. Many of those remain in the planning stages, however, and some have run aground.
Chinese media reports say other Chinese subcontractors have complained that CIF was failing to pay for work and materials supplied for some other African construction projects. "Some projects have been slow to get off the ground, and there are bottlenecks," said Chatham House's Weimer. "They are not delivering on their timelines."
A receptionist who answered the phone at its Beijing office said she had no information about the Guinea mining deal and there was no one available to comment. A woman who answered the phone at the fund's Hong Kong office declined to comment and there was no response to questions faxed to the office.
Despite CIF's deep connections to the government, "Africa expert" Stephen Morrisson said the company likely hatched the deal on its own, without excessive Chinese government involvement. "Often these decisions are taken quite independently and often there is little internal policy coordination or deliberation," said Morrisson, of the Center for Strategic and International Studies in Washington. He also questioned reports characterizing the deal as a "lifeline" to the Guinean regime, saying the leadership likely lacked the wherewithal to fully see it through."Overall, I don't think this will rescue the current miserable crowd attempting to rule Guinea," Morrisson said.
October 21, 2009
COMESA to craft simpler rules for small scale traders
by Allan Odhiambo
Regional trade ministers hope to tap $7.5 billion in new business by rolling out simplified rules to help small-scale cross-border traders maximise on the benefits of integrated market systems.
Though informal traders are estimated to account for 50 per cent of the annual $15 billion trade within the Common Market for Eastern and Southern Africa (Comesa), their potential has not been fully exploited over the years due to complicated customs and certification procedures. Small-scale traders have often been denied duty and quota free access for their goods even when they are eligible for it. To correct this anomaly, trade ministers from the 19-member Comesa bloc will on October 22 endorse provisions for a new simplified trade regime(STR) focused on customs and rules of origin.
“Kenya will endorse the implementation of the STR especially because it is in line with our trade liberalisation policy,” trade minister Amos Kimunya said in a speech read on his behalf by Trade PS Abdirazaq Ali during the opening of a preparatory meeting of regional officials in Nairobi. Kenya will host the signing of the STR pact during which time the member states are expected to agree on an implementation calendar.
Comesa deputy secretary-general in charge of programmes, Stephen Karangizi, said small-scale traders had failed to reap the benefits of the Comesa customs union and free trade area due to stringent documentation requirements. “The simplified trade regime is important in facilitating trade and reducing poverty. It recognises cross-border trading as a important source of employment in this era of high unemployment and as an income-generating activity that sustains families,” he said.
According to provisions of the new trade regime, traders will be granted simplified certificates of origin to enable them to enjoy duty and quota free access as long as their goods appear on a list of agreed products. The certificates will be filled in by traders at designated border posts and stamped by customs officials upon verification. However, only small-scale border traders with consignments valued at $500 or less will be eligible to use these simplified certificates of origin. Traders handling larger consignments who wish to benefit from duty-free access will be required to use the normal Comesa certificate of origin.
A preview of the common list recommended for adoption under the new STR arrangement showed that agricultural product traders would be the biggest beneficiaries.The products on the list expected to be endorsed by the regional trade ministers, include beverage crops such as tea and coffee; cereals such as maize, wheat and sorghum, cotton, sisal, fish; and fish products as well as raw milk. Other listed products include livestock and livestock products, fruits, nuts, oil seeds, poultry and poultry products, vegetables, root crops as well as sugarcane.
Mr Karangizi said the list of products would be discussed exhaustively by officials from all members states before being presented to regional trade ministers for adoption. “The important thing is to reach consensus on what can be agreed so that implementation can begin. Those items not agreed can be subject to negotiation later when the STR is being implemented,” he said.
Karangizi cautioned that while the STR was an opportunity to improve trade in the region, there still existed other barriers that needed to be overcome.“In particular we note in agriculture that the sanitary and phytosanitary requirements need to be regionalised so as to permit free flow within the region,” Mr Karangizi said, revealing that Comesa was already working with the East African Community (EAC) to adopt a common approach in the implementation of the STR. “EAC is already implementing the simplified certificate of origin and what the traders want to see is a seamless set of simple rules,” he added.
And as Comesa members prepared to endorse the new simplified regime, analysts warned that restrictive trade practices such as export bans in the face of challenges such as agricultural production shortfalls would have to cease. “Once the new rules come through, then interferences to free flow of goods such as the imposition of export bans will have to be lifted,” Mr Richard Sindiga, head of the Comesa desk as the trade ministry said. Currently several regional states including Kenya and Tanzania have imposed export bans on key commodities such as maize in a bid to guard consumers in their domestic markets in the face of massive crop failures.
Mr Kimunya said cross-border trade was crucial in addressing food security in the region.“They enable food be moved from one area to another where supplies are diminishing without having to go through lengthy processes,” he said.
Mr Karangizi said the adoption of the STR would help curb smuggling of goods and reduce the costs of transaction.“Mainstreaming cross-border trade from informal to formal will lead to better data capture and improve planning and policy-making as trade flow will be better monitored,” he said. Business Daily Africa
Regional trade ministers hope to tap $7.5 billion in new business by rolling out simplified rules to help small-scale cross-border traders maximise on the benefits of integrated market systems.
Though informal traders are estimated to account for 50 per cent of the annual $15 billion trade within the Common Market for Eastern and Southern Africa (Comesa), their potential has not been fully exploited over the years due to complicated customs and certification procedures. Small-scale traders have often been denied duty and quota free access for their goods even when they are eligible for it. To correct this anomaly, trade ministers from the 19-member Comesa bloc will on October 22 endorse provisions for a new simplified trade regime(STR) focused on customs and rules of origin.
“Kenya will endorse the implementation of the STR especially because it is in line with our trade liberalisation policy,” trade minister Amos Kimunya said in a speech read on his behalf by Trade PS Abdirazaq Ali during the opening of a preparatory meeting of regional officials in Nairobi. Kenya will host the signing of the STR pact during which time the member states are expected to agree on an implementation calendar.
Comesa deputy secretary-general in charge of programmes, Stephen Karangizi, said small-scale traders had failed to reap the benefits of the Comesa customs union and free trade area due to stringent documentation requirements. “The simplified trade regime is important in facilitating trade and reducing poverty. It recognises cross-border trading as a important source of employment in this era of high unemployment and as an income-generating activity that sustains families,” he said.
According to provisions of the new trade regime, traders will be granted simplified certificates of origin to enable them to enjoy duty and quota free access as long as their goods appear on a list of agreed products. The certificates will be filled in by traders at designated border posts and stamped by customs officials upon verification. However, only small-scale border traders with consignments valued at $500 or less will be eligible to use these simplified certificates of origin. Traders handling larger consignments who wish to benefit from duty-free access will be required to use the normal Comesa certificate of origin.
A preview of the common list recommended for adoption under the new STR arrangement showed that agricultural product traders would be the biggest beneficiaries.The products on the list expected to be endorsed by the regional trade ministers, include beverage crops such as tea and coffee; cereals such as maize, wheat and sorghum, cotton, sisal, fish; and fish products as well as raw milk. Other listed products include livestock and livestock products, fruits, nuts, oil seeds, poultry and poultry products, vegetables, root crops as well as sugarcane.
Mr Karangizi said the list of products would be discussed exhaustively by officials from all members states before being presented to regional trade ministers for adoption. “The important thing is to reach consensus on what can be agreed so that implementation can begin. Those items not agreed can be subject to negotiation later when the STR is being implemented,” he said.
Karangizi cautioned that while the STR was an opportunity to improve trade in the region, there still existed other barriers that needed to be overcome.“In particular we note in agriculture that the sanitary and phytosanitary requirements need to be regionalised so as to permit free flow within the region,” Mr Karangizi said, revealing that Comesa was already working with the East African Community (EAC) to adopt a common approach in the implementation of the STR. “EAC is already implementing the simplified certificate of origin and what the traders want to see is a seamless set of simple rules,” he added.
And as Comesa members prepared to endorse the new simplified regime, analysts warned that restrictive trade practices such as export bans in the face of challenges such as agricultural production shortfalls would have to cease. “Once the new rules come through, then interferences to free flow of goods such as the imposition of export bans will have to be lifted,” Mr Richard Sindiga, head of the Comesa desk as the trade ministry said. Currently several regional states including Kenya and Tanzania have imposed export bans on key commodities such as maize in a bid to guard consumers in their domestic markets in the face of massive crop failures.
Mr Kimunya said cross-border trade was crucial in addressing food security in the region.“They enable food be moved from one area to another where supplies are diminishing without having to go through lengthy processes,” he said.
Mr Karangizi said the adoption of the STR would help curb smuggling of goods and reduce the costs of transaction.“Mainstreaming cross-border trade from informal to formal will lead to better data capture and improve planning and policy-making as trade flow will be better monitored,” he said.
October 20, 2009
ECOWAS trade bloc suspends Niger
West Africa's trade grouping Ecowas has suspended Niger after President Mamadou Tandja went ahead with a controversial parliamentary election. Ecowas had called on Mr Tandja to postpone the vote indefinitely to allow talks with opposition politicians - who have boycotted the election of October 20. They are angry at the president's attempts to extend his time in power.
Mr Tandja dissolved parliament earlier this year and had the constitution changed to let him seek a third term. After talks at the weekend, Ecowas had warned the 71-year-old president to delay the election or face "full sanctions".
The bloc's political director, Abdel Fatau Musa, told the BBC's Focus on Africa programme it was clear Mr Tandja had rejected the decision of Ecowas. He defended the decision to suspend the nation, saying it would affect Mr Tandja. "If you are considered a pariah, an outcast, from an organisation you have ratified the conditions of, then psychologically it will affect you," he said. He warned that the issue could end up in the UN Security Council, and Niger could be left in international isolation unless Mr Tandja backed down.
The president's move to stay in power in the uranium-rich nation sparked international outrage and dismay among opposition groups. He had been due to stand down in December after serving two five-year terms. But his supporters say the people want him to stay in power because he has brought financial stability to one of the world's poorest nations.
In January, French company Areva signed a deal to develop what it said would become the world's second biggest uranium mine. The mine is in the semi-desert north, where ethnic Tuareg rebels have been fighting for more autonomy. President Tandja has signed a peace deal with several Tuareg groups.
Six million people are eligible to vote to elect a new 113-member parliament, but correspondents say the campaign has been marked by indifference among residents.
BBC
Mr Tandja dissolved parliament earlier this year and had the constitution changed to let him seek a third term. After talks at the weekend, Ecowas had warned the 71-year-old president to delay the election or face "full sanctions".
The bloc's political director, Abdel Fatau Musa, told the BBC's Focus on Africa programme it was clear Mr Tandja had rejected the decision of Ecowas. He defended the decision to suspend the nation, saying it would affect Mr Tandja. "If you are considered a pariah, an outcast, from an organisation you have ratified the conditions of, then psychologically it will affect you," he said. He warned that the issue could end up in the UN Security Council, and Niger could be left in international isolation unless Mr Tandja backed down.
The president's move to stay in power in the uranium-rich nation sparked international outrage and dismay among opposition groups. He had been due to stand down in December after serving two five-year terms. But his supporters say the people want him to stay in power because he has brought financial stability to one of the world's poorest nations.
In January, French company Areva signed a deal to develop what it said would become the world's second biggest uranium mine. The mine is in the semi-desert north, where ethnic Tuareg rebels have been fighting for more autonomy. President Tandja has signed a peace deal with several Tuareg groups.
Six million people are eligible to vote to elect a new 113-member parliament, but correspondents say the campaign has been marked by indifference among residents.
BBC
1. Which way for South Africa: free trade or protectionism?
2. Nigerian cement producer wins Chinese contracts in Senegal, Zambia
3. China-aided bus assembly line starts production in Senegal
4. Chinese export figures suggest stabilizing world economy
5. Nationwide strike brings Guinea to a standstill
6. Ethiopian commodity exchange gets off the ground
7. Middle East and Africa bear untold riches for exporters
8. Singapore ventures into sub-Saharan Africa in a big way
9. China trade deal may bail out Guinea junta
10. Rwanda president lauds China's role in Africa, slams West
11. IMF says worker was offered, returned monetary gift to Senegal
2. Nigerian cement producer wins Chinese contracts in Senegal, Zambia
3. China-aided bus assembly line starts production in Senegal
4. Chinese export figures suggest stabilizing world economy
5. Nationwide strike brings Guinea to a standstill
6. Ethiopian commodity exchange gets off the ground
7. Middle East and Africa bear untold riches for exporters
8. Singapore ventures into sub-Saharan Africa in a big way
9. China trade deal may bail out Guinea junta
10. Rwanda president lauds China's role in Africa, slams West
11. IMF says worker was offered, returned monetary gift to Senegal
October 19, 2009
Which way for South Africa: free trade or protectionism?
by Nic Dawes
The debate over the future trajectory of South Africa's economic policy is about much more than the powers of Trevor Manuel and the planning ministry.
Bubbling under for the past five years at least has been an argument within government about trade.
Put crudely, the question is whether South Africa is more likely to prosper if local companies are exposed to global competition and forced to lower their prices while improving their products, or if, on the contrary, we need to shelter them behind tariff and regulatory barriers that will enable them to grow stronger before they take on the world.
Right now this debate is taking place against the backdrop of reforms in the architecture ofinternational finance and a tussle over the future of the World Trade Organisation’s (WTO) Doha development round.
These are discussions that can easily be lost in the technical minutiae of multilateral negotiations and the dry language of economics, but they are crucial to the future shape of our economic policy landscape.
M&G editor Nic Dawes interviews Trade and Industry Minister Rob Davies, a robust proponent of the view that South Africa needs to protect emerging and strategic industries, and a leading activist among developing country ministers involved in negotiations at the WTO.
Nic Dawes: It is clear that high prices and cartel activity are a major constraint on economic growth, so there are many inside government and out who think we need more competition. Others, including you, are arguing for more trade protection while pursuing robust anti-cartel action. Broadly speaking, does South African industry need cosseting or shaking up?
Rob Davies: All our policies are informed by the commitment to create decent work and sustainable livelihoods. We need to defend jobs and create growth. Concentration in the mature part of our economy has been damaging to labour-intensive industries.
Sometimes people think we don’t want to allow cooperation between companies, but we are acting because we see detrimental effects from collusive activity. On the other hand, our flagship programme is industrial strategy.
There has been no country that has placed itself on a path of increasing returns without industrial policy. A degree of trade protection goes along with that. Mature industrial economies are in favour of free trade.
When the United States was industrialising, Britain [which had already gone through its industrial revolution] wanted free trade. We're in an era of decreasing tariff protection, but it has been highly uneven.
As WTO members we have very little space between bound industrial tariffs [the maximum we can charge in terms of WTO agreements] and applied tariffs [the amount we actually do charge]. The bound tariff for clothing, for example, is 45%; our applied rate is 40%.
Once the Doha formulae kick in, we would have to take extraordinary cuts. So, we will continue to pursue tariff reduction in mature industries [such as steel] that produce high value goods for downstream industries. Where there is a case for tariff protection and we have legal space available to us, we will use it.
Q: There is clearly huge frustration, particularly in the developed world, but also from more liberal emerging countries such as Chile, at what they see as your lobbying against aspects of the Doha deal that would see poorer countries reduce their protection on manufactured goods and services. Should we really, for example, continue to offer support in the form of subsidies and higher prices to a clothing and textile industry that has signally failed to remain competitive, even behind a 40% tariff? Wouldn’t it be better to have a bigger motor repair and sales sector than a local motor industry that still lives off tariffs and what look to many like subsidies?
A: The free trade model doesn’t describe existing reality and the free trade ideology [of those countries] is belied in practice. We have identified the possibility for our clothing industry if it restructures into things like fast fashion [very rapid response to emerging trends], industrial textiles and sporting goods.
There’s a need, though, for the industry to invest and the incentive programme for investment will help upgrade the industry. The motor industry has already seen a substantial reduction in tariffs and support since apartheid. People don’t see all the linkages into other areas of the economy involved.
The next stages we are looking to emphasise are components and heavy vehicles. If you look around the world, the motor industry generally has something like our programme. Ours, in fact, is extremely modest.
If you want to be a major player and you are far from major markets, this is how you need to engage. The point is, deindustrialisation would be a major step back. Once you lose industrial capacity, you don’t get it back.
Q: Clearly, though, there are some serious difficulties about aligning this kind of approach with neighbouring countries. There are already clear fault lines over their relations with the European Union and you have seemed to suggest that the Southern African Customs Union [Sacu] may not survive.
A: There’s no doubt in my mind that deepening regional integration is very important. In SADC the pattern of trade hasn’t changed much with changing tariffs. Infrastructure -- effectively, the inability of neighbouring countries to produce goods for the South African market -- is the constraint.
The priority now should not be Sacu, but to make the SADC Free Trade Agreement work, and widen free trade agreements [FTAs] with Comesa [Common Market for Eastern and Southern Africa] and the East African community, while interrogating rigorously the timetable to move SADC to a customs union.
Sacu is an important building block for this, but we need at least the beginnings of common understanding about the development path for the region. The deal for 100 years with Sacu was that we got access; they got tariff revenue. It was a relationship of convenience.
We now need to ask whether tariffs are a revenue instrument [Sacu countries like Lesotho and Swaziland rely heavily on tariffs from cars imported to South Africa to fund their budgets] or a development instrument. If we are going to have free trade, who should it be with?
We have excellent political and economic relations with the countries of the south but not so much trade. If we have a common vision, we can deepen Sacu; if not, the centripetal forces will weaken it.
I would say the trade relationship with the south works less well for us than with the rich world, which buys some value added-products from us. It’s not that the patterns of trade [with the south] are ideal. We export too many primary products and import too many manufactures. But they recognise this and want to complement FTAs with cooperative agreements to prioritise mutually beneficial trade. For all of them the model of driving their exports to the developed world is no longer that attractive.
There does seem to be agreement on sticking it to the US and EU on manufactures and services in the Doha talks. The fact that we are increasingly put in the same boat helps. At an informal ministerial in India [last month] we agreed to re-energise the round, but the devil is in the detail.
We’ve had a modest deal on agriculture, but nothing more than that, and it is coupled with highly ambitious demands being placed on the bigger developing countries [in terms of giving rich countries market access for non-agricultural products].
South Africa is in a particularly invidious position. It’s a historic injustice. We had taken tremendous pain because during the Uruguay round of the WTO the apartheid government insisted we were a developed economy.
On the Doha formula we would be taking cuts at an applied rate of 30% on 27% of our industrial tariff lines [categories of goods]. Other countries say they are already at the line; we are over the line. We need to come back and they need to go no further.
Q: What are the chances you can win any such concession when the political climate in the US and Europe is increasingly protectionist?
A: The analysis that informed the willingness of developing countries to reconsider Doha was the assertion that their needs would be placed “at the heart of the work programme.” Right now, those issues do not dominate the end game. The price [for the developed world] is too high.
In 2005 we won a paragraph that said the level of ambition for agricultural and non-agricultural goods must be comparably high. Whether the political will is there in the rich world is a question.
The new US administration talks about multilateralism, but it is not translating that talk into positions. We are hearing more and more about market access for US companies, just as we did from the previous administration.
A: Can you ever really prevail in the debate with treasury about these issues? They certainly lean towards competition and away from protection and, so far, they haven’t backed industrial policy plans.
A: Just because something is a manifesto commitment doesn’t exempt us from the need to produce sound plans. Capacity has been an issue -- the developmental state is an aspiration, not a reality -- but we are advertising new posts and developing skills. The new planning function in the presidency will help too, and I think we will be heard.
Mail and Guardian
The debate over the future trajectory of South Africa's economic policy is about much more than the powers of Trevor Manuel and the planning ministry.
Bubbling under for the past five years at least has been an argument within government about trade.
Put crudely, the question is whether South Africa is more likely to prosper if local companies are exposed to global competition and forced to lower their prices while improving their products, or if, on the contrary, we need to shelter them behind tariff and regulatory barriers that will enable them to grow stronger before they take on the world.
Right now this debate is taking place against the backdrop of reforms in the architecture ofinternational finance and a tussle over the future of the World Trade Organisation’s (WTO) Doha development round.
These are discussions that can easily be lost in the technical minutiae of multilateral negotiations and the dry language of economics, but they are crucial to the future shape of our economic policy landscape.
M&G editor Nic Dawes interviews Trade and Industry Minister Rob Davies, a robust proponent of the view that South Africa needs to protect emerging and strategic industries, and a leading activist among developing country ministers involved in negotiations at the WTO.
Nic Dawes: It is clear that high prices and cartel activity are a major constraint on economic growth, so there are many inside government and out who think we need more competition. Others, including you, are arguing for more trade protection while pursuing robust anti-cartel action. Broadly speaking, does South African industry need cosseting or shaking up?
Rob Davies: All our policies are informed by the commitment to create decent work and sustainable livelihoods. We need to defend jobs and create growth. Concentration in the mature part of our economy has been damaging to labour-intensive industries.
Sometimes people think we don’t want to allow cooperation between companies, but we are acting because we see detrimental effects from collusive activity. On the other hand, our flagship programme is industrial strategy.
There has been no country that has placed itself on a path of increasing returns without industrial policy. A degree of trade protection goes along with that. Mature industrial economies are in favour of free trade.
When the United States was industrialising, Britain [which had already gone through its industrial revolution] wanted free trade. We're in an era of decreasing tariff protection, but it has been highly uneven.
As WTO members we have very little space between bound industrial tariffs [the maximum we can charge in terms of WTO agreements] and applied tariffs [the amount we actually do charge]. The bound tariff for clothing, for example, is 45%; our applied rate is 40%.
Once the Doha formulae kick in, we would have to take extraordinary cuts. So, we will continue to pursue tariff reduction in mature industries [such as steel] that produce high value goods for downstream industries. Where there is a case for tariff protection and we have legal space available to us, we will use it.
Q: There is clearly huge frustration, particularly in the developed world, but also from more liberal emerging countries such as Chile, at what they see as your lobbying against aspects of the Doha deal that would see poorer countries reduce their protection on manufactured goods and services. Should we really, for example, continue to offer support in the form of subsidies and higher prices to a clothing and textile industry that has signally failed to remain competitive, even behind a 40% tariff? Wouldn’t it be better to have a bigger motor repair and sales sector than a local motor industry that still lives off tariffs and what look to many like subsidies?
A: The free trade model doesn’t describe existing reality and the free trade ideology [of those countries] is belied in practice. We have identified the possibility for our clothing industry if it restructures into things like fast fashion [very rapid response to emerging trends], industrial textiles and sporting goods.
There’s a need, though, for the industry to invest and the incentive programme for investment will help upgrade the industry. The motor industry has already seen a substantial reduction in tariffs and support since apartheid. People don’t see all the linkages into other areas of the economy involved.
The next stages we are looking to emphasise are components and heavy vehicles. If you look around the world, the motor industry generally has something like our programme. Ours, in fact, is extremely modest.
If you want to be a major player and you are far from major markets, this is how you need to engage. The point is, deindustrialisation would be a major step back. Once you lose industrial capacity, you don’t get it back.
Q: Clearly, though, there are some serious difficulties about aligning this kind of approach with neighbouring countries. There are already clear fault lines over their relations with the European Union and you have seemed to suggest that the Southern African Customs Union [Sacu] may not survive.
A: There’s no doubt in my mind that deepening regional integration is very important. In SADC the pattern of trade hasn’t changed much with changing tariffs. Infrastructure -- effectively, the inability of neighbouring countries to produce goods for the South African market -- is the constraint.
The priority now should not be Sacu, but to make the SADC Free Trade Agreement work, and widen free trade agreements [FTAs] with Comesa [Common Market for Eastern and Southern Africa] and the East African community, while interrogating rigorously the timetable to move SADC to a customs union.
Sacu is an important building block for this, but we need at least the beginnings of common understanding about the development path for the region. The deal for 100 years with Sacu was that we got access; they got tariff revenue. It was a relationship of convenience.
We now need to ask whether tariffs are a revenue instrument [Sacu countries like Lesotho and Swaziland rely heavily on tariffs from cars imported to South Africa to fund their budgets] or a development instrument. If we are going to have free trade, who should it be with?
We have excellent political and economic relations with the countries of the south but not so much trade. If we have a common vision, we can deepen Sacu; if not, the centripetal forces will weaken it.
I would say the trade relationship with the south works less well for us than with the rich world, which buys some value added-products from us. It’s not that the patterns of trade [with the south] are ideal. We export too many primary products and import too many manufactures. But they recognise this and want to complement FTAs with cooperative agreements to prioritise mutually beneficial trade. For all of them the model of driving their exports to the developed world is no longer that attractive.
There does seem to be agreement on sticking it to the US and EU on manufactures and services in the Doha talks. The fact that we are increasingly put in the same boat helps. At an informal ministerial in India [last month] we agreed to re-energise the round, but the devil is in the detail.
We’ve had a modest deal on agriculture, but nothing more than that, and it is coupled with highly ambitious demands being placed on the bigger developing countries [in terms of giving rich countries market access for non-agricultural products].
South Africa is in a particularly invidious position. It’s a historic injustice. We had taken tremendous pain because during the Uruguay round of the WTO the apartheid government insisted we were a developed economy.
On the Doha formula we would be taking cuts at an applied rate of 30% on 27% of our industrial tariff lines [categories of goods]. Other countries say they are already at the line; we are over the line. We need to come back and they need to go no further.
Q: What are the chances you can win any such concession when the political climate in the US and Europe is increasingly protectionist?
A: The analysis that informed the willingness of developing countries to reconsider Doha was the assertion that their needs would be placed “at the heart of the work programme.” Right now, those issues do not dominate the end game. The price [for the developed world] is too high.
In 2005 we won a paragraph that said the level of ambition for agricultural and non-agricultural goods must be comparably high. Whether the political will is there in the rich world is a question.
The new US administration talks about multilateralism, but it is not translating that talk into positions. We are hearing more and more about market access for US companies, just as we did from the previous administration.
A: Can you ever really prevail in the debate with treasury about these issues? They certainly lean towards competition and away from protection and, so far, they haven’t backed industrial policy plans.
A: Just because something is a manifesto commitment doesn’t exempt us from the need to produce sound plans. Capacity has been an issue -- the developmental state is an aspiration, not a reality -- but we are advertising new posts and developing skills. The new planning function in the presidency will help too, and I think we will be heard.
Mail and Guardian
October 15, 2009
Nigerian cement producer wins Chinese contracts in Senegal, Zambia
by Chijioke Ohuocha
Nigeria's largest cement producer Dangote Cement said it had signed construction contracts worth $228 million with China's Sinoma International Group to build cement plants in Senegal and Zambia. The contracts for two 3,000-tonne per day cement plants mark the revival of the Nigerian firm's expansion plans outside Africa's most populous country following the global economic slowdown.
"We have concluded this deal with Sinoma in order to drive forward our pan-Africa expansion strategy at a time when the global economy seems to be emerging from recession," Aliko Dangote, President and CEO of the Dangote Group said in a statement. "We are in a strong financial position and we are putting our money where our mouth is", he added.
Dangote Cement has projects and operations in Nigeria, Benin, Ghana, Senegal, Zambia and South Africa, with a capacity of 13 million tonnes. The group's total commitment to new production capacity in Africa is $1.63 billion.
Partnerships between African and Chinese companies have become more common as Beijing looks to secure natural resources for the Asian giant's growing economy. Nigerian government officials announced last month that Chinese firms wanted to buy 6 billion barrels of its crude oil reserves.
Reuters
Nigeria's largest cement producer Dangote Cement said it had signed construction contracts worth $228 million with China's Sinoma International Group to build cement plants in Senegal and Zambia. The contracts for two 3,000-tonne per day cement plants mark the revival of the Nigerian firm's expansion plans outside Africa's most populous country following the global economic slowdown.
"We have concluded this deal with Sinoma in order to drive forward our pan-Africa expansion strategy at a time when the global economy seems to be emerging from recession," Aliko Dangote, President and CEO of the Dangote Group said in a statement. "We are in a strong financial position and we are putting our money where our mouth is", he added.
Dangote Cement has projects and operations in Nigeria, Benin, Ghana, Senegal, Zambia and South Africa, with a capacity of 13 million tonnes. The group's total commitment to new production capacity in Africa is $1.63 billion.
Partnerships between African and Chinese companies have become more common as Beijing looks to secure natural resources for the Asian giant's growing economy. Nigerian government officials announced last month that Chinese firms wanted to buy 6 billion barrels of its crude oil reserves.
Reuters
October 14, 2009
China-aided bus assembly line starts production in Senegal
A mid-size bus assembly line built by Xiamen Kinglong United Automotive Industry Co., Ltd. for Senegal started production in Thies, a western city in the country, on October 13, 2009.
Chinese President Hu Jintao inked an agreement on the project in February during his visit to Senegal, part of China's effort to help West African countries in their development of the traffic and transportation industries. The Export-Import Bank of China (China Eximbank) provided favorable loans for the assembly line, which had a total investment of USD 18 million.
Actually, in February, Senegal placed an order for 406 city buses from Kinglong. Four of them were ordered in the form of complete cars while the other exported to the country in complete knock down (CKD).
In recent years, Kinglong extended reach from Southeast Asia and Middle East to Europe, South America and Africa. It exports both complete cars and components to countries in the above regions.
Trading Markets
Chinese President Hu Jintao inked an agreement on the project in February during his visit to Senegal, part of China's effort to help West African countries in their development of the traffic and transportation industries. The Export-Import Bank of China (China Eximbank) provided favorable loans for the assembly line, which had a total investment of USD 18 million.
Actually, in February, Senegal placed an order for 406 city buses from Kinglong. Four of them were ordered in the form of complete cars while the other exported to the country in complete knock down (CKD).
In recent years, Kinglong extended reach from Southeast Asia and Middle East to Europe, South America and Africa. It exports both complete cars and components to countries in the above regions.
Trading Markets
Chinese export figures suggest stabilizing world economy
China's $596bn stimulus package has helped prop up its economy, but it needs a global recovery to boost trade. Imports fell 3.5% to $103bn, which was the smallest decline since imports began to slide in November 2008. The slowing decline has been taken as a sign that the stimulus package is working.
China's trade surplus stood at $135.5bn (£85bn) for the first nine months of 2009, falling 26% compared with the same period a year ago, according to the General Administration of Customs.
"Overall, export performance will be much better in the months to come. I think it's going to be sustainable and it's going to accelerate," said Dong Tao, an economist at Credit Suisse in Hong Kong. "There are some rush orders coming to China for Christmas, so I expect probably a pretty strong rebound in November and December," he said.
The slowing decline in imports was mainly a result of record iron ore shipments to China of 64.6 million tons in September. The iron is needed to make steel, which is in demand as the stimulus package boosts construction.
Between January and August, China's total trade with the European Union fell 19.4% while trade with the US fell 15.8% and trade with Japan declined 20%. China's Vice Minister of Commerce Zhong Shan recently said that China's exporters were still facing a tough time. To support exporters, China has raised value added tax rebates on exports several times in the past year, increased tax refunds and improved export credit insurance. The central bank has also effectively halted the yuan's rise against the dollar since July 2008.
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