heavy truck is assembled on the production line at the Shaanxi
Automobile Holding Group Co., Ltd. in Xi'an, northwest China's Shaanxi
Province, Sept. 27, 2022. (Xinhua/Liu Xiao)
economy is expected to bounce back this year as mobility and activity
ramp up following the easing of pandemic restrictions. This will provide
a boost to the global economy. According to IMF projections, China's
GDP will grow by 5.2 percent in 2023.
How will the Chinese
economic recovery and growth affect other developing countries, with a
special emphasis on Africa? What sort of cooperation will be required
between China and Africa to ensure that the continent reaps the greatest
possible benefits from this growth?
The Chinese government's
major objective this year will be to stimulate domestic demand. This is a
good chance for African countries to gain access to China's massive
China also waived tariffs on 98 percent of taxable imports from nine countries in Africa on December 1, 2022.
part of China's plan to increase its trade with African nations to $300
billion by 2025, the Chinese government has enacted a policy that
covers almost 8,800 different products, some of which are clothes and
footwear, agricultural goods and chemical products. This objective is
attainable due to the huge and rising trend of agricultural imports to
China from African countries.
Although China does not have
tariff-free access to African markets, it has become the continent's
second-largest export market, behind the US.
The challenge at
hand is how African nations can increase their exports to China so that
they can take advantage of China's tariff-free market access. They need
to grow production on the continent and learn more from the expertise of
the Chinese government. They also need to raise their productivity and
diversify the products they offer.
The majority of Africa's
economic growth has not been followed by a rise in the continent's
general level of productivity. Africa's recent economic growth has been
primarily driven by exports of agricultural raw materials. This is
despite the fact that Africa has a relatively young population.
many people have switched to working in the services industry, most of
the increase in services is restricted to low-productivity activities
such as commerce and production sectors. The agriculture sector
continues to provide jobs for a significant proportion of the labor
aerial photo taken on Nov. 5, 2022 shows a view of the Yangpu
international container terminal in the Yangpu Economic Development
Zone, south China's Hainan Province. (Xinhua/Pu Xiaoxu)
Diversity of African products
diversity of products offered by African nations needs more attention
from these nations. In Africa, 45 out of the 54 countries are still
reliant on exports of primary products from the agricultural, mining,
and extractive industries.
To facilitate the production and
export of more complex goods and services, Africa should encourage the
use of inputs that require a high level of expertise and technology.
tourist industry is an area in which African nations desperately need
China to form a strong collaboration. The removal of pandemic control
measures will lead to an increase in the number of Chinese tourists who
travel to Africa. For example, before the pandemic, a report from FOCAC
indicated that more than 1 million Chinese tourists were traveling to
Africa every year.
African nations need to improve the
effectiveness of their border services, and other government and hotel
services. In addition, the services provided by inland transportation
should be improved and made more effective.
China's success in
producing the skills that are required to accept technology was the key
cause for the country's success in attracting investment in
manufacturing. Again, this is an area in which Africa can gain a great
deal by studying China's practices.
Enticing Chinese firms
an issue that Africa should give priority to is the best way to entice
more Chinese enterprises to establish branches on the continent.
nations should have the intelligence to attract more Chinese investors
by giving effective industry policies, but they also need to retain the
companies that are already investing, through effective industry
policies and better services. .
According to the UNCTAD (2022)
Economic Growth in Africa Report, there are already more than 2,200
Chinese businesses, the vast majority of which are privately-run
businesses, operating across Africa. China's commercial activities have
made a contribution to the expansion of the African economy.
direct investment from China has led to job creation. In order for
African countries to take advantage of China's tariff-free policies,
China might provide a hand to African nations in addressing the
structural and logistical restrictions that limit the competitiveness of
Increasing Chinese investment in African
countries, from both public and private sources, presents an opportunity
to enhance local infrastructure, as well as expand manufacturing and
China's interest in investments in Africa
has a significant impact on economic transformation and export
diversification. For this reason, cooperation and partnership between
China and Africa should be strengthened.
African nations need to be aware that Chinese businesses are investing in their continent, and that these investments bring access to technology, skills, training and knowledge transfer, in addition to linkages to global value chains.
The author is a doctoral student (Class of 2021) in the Institute of South-South Cooperation and Development (ISSCAD) of Peking University, former state minister of the Ministry of Trade and Industry of Ethiopia.
Source: Global Times