On May 14, at the Forum for Chinese and African Entrepreneurs, the head of Project Finance at South Africa Standard Bank, Jonathan Wood, had this to say, “Africa’s economic growth exceeded that of the world average in the past decade, and thus African countries have great demands for infrastructure construction. I think this gives Chinese enterprises more opportunities.”

Established in 1862 in South Africa, Standard Bank, the largest commercial bank in Africa, has branches in 18 African nations and 21 non-African countries. “Since we are familiar with African and Chinese markets, we can supply excellent financing services to enterprises for both markets and help them find suitable partners,” the Chief Representative of Standard Bank’s Shanghai office, Fan Bing, told Beijing Review.

According to Jacko Maree, CEO of Standard Bank, his bank has lent Shanghai and Hong Kong a platform to help its Chinese clients invest in Africa.

New frontiers

On May 13, the AfDB, together with the Organization of Economic Cooperation Development (OECD), published the African Economic Outlook 2006/2007, noting that Africa has been experiencing its highest economic growth, with the GDP growth rate averaging about 5 percent in the past six years, rising to 5.5 percent in 2006, and expected to reach 6 percent in 2007. The OECD is an international organization headquartered in Paris, helping governments tackle the economic, social and governmental challenges thrown up by a globalized economy.

According to the document, which investigated 31 major African countries-comprising 86 percent of the continent’s population and 91 percent of its economic aggregate-the main factors supporting this growth were a strong external demand for oil and non-oil minerals, increased investment in these sectors, and weather conditions favorable for agriculture. The perpetuation of sound macroeconomic policies in most of the countries also increased business confidence, leading to a general escalation in private investment. However, “the continent needs to accelerate growth to the level of 7 to 8 percent to be able to achieve our Millennium Development Goal of halving the proportion of people living in extreme poverty by 2015,” said Dr. Louis Kasekende, Chief Economist of the African Development Bank.

“China and Africa are partners on an equal and mutually beneficial basis. Sino-African trade currently contributes 20 percent to Africa’s economic growth,” said Wei Jianguo, Deputy Minister of Commerce of China. In 2006, China became Africa’s third largest trade partner after the United States and France, with bilateral trade volume hitting $55.5 billion. According to Wei, the high quality and inexpensiveness of Chinese goods broke the monopolization of the African market by high-priced commodities, and brought real benefits to its people. China’s technologies are also suitable for African countries, a factor that goes a long way in reducing operating costs.

A recent study made by Harry G. Broadman, Advisor on the African Economy at the World Bank, shows that the rise in Sino-African and Indo-African trade has produced great opportunities for the Sub-Sahara countries to develop their markets. In his book, Africa’s Silk Road: China and India’s New Economic Frontier, Broadman reckons that the rapid growth of Sino-African trade and sustained Chinese investment in the continent would boost the integration of the African economy with the world economy.

He Wenping, Director of the African section of the Institute of West Asian and African Studies at the Chinese Academy of Social Sciences, said at the conference that China has contributed an average of 14 percent to the growth of the world economy since the year 1979, when it began to adopt the policy of reform and opening up. “More and more African countries are sharing the benefits of China’s economic growth,” he affirmed.

An unqualified success

The two-day meeting was hailed by AfDB President Kaberuka as “a success.” He said the discussions on a wide range of issues were constructive and the organization of the event flawless.

“We did a lot of work before the meeting was held to ensure its success,” Liu Changqing, an official in the Shanghai Headquarters of PBC, told Beijing Review. Liu had visited the Asian Development Bank’s Beijing office in April to gather information regarding its experience of holding annual meetings. According to Liu, this year’s meeting was of the highest caliber, and of the largest scale in AfDB’s history. The delegates present included such dignitaries as Rwandan President Paul Kagame, Pedro Pires, President of Cape Verde, and Madagascar President Marc Ravalomanana. The World Bank, the International Monetary Fund, and other regional and sub-regional development financial institutions and nongovernmental organizations also attended the meeting, at which the number of participants exceeded 2,100. Among these were 437 journalists, far more than at the annual meetings in previous years.

Participants focused their discussions on AfDB reform, development financing, debt management, aid to vulnerable countries and Asian-African cooperation, among other issues. PBC Governor Zhou, who chaired the meetings, said the meeting helped give birth to an AfDB blueprint on how to carry out poverty eradication and development programs in a more effective way. A series of business seminars were staged on the sidelines of the AfDB board meetings, which helped companies and entrepreneurs, Chinese or African, establish contacts and discuss deals. The next AfDB board meeting will be held in Maputo, Mozambique, next May.