FOCAC: Call for investment-led trade

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FOCAC: Call for investment-led trade

FOCAC: Call for investment-led trade
Photo credit: South African Government News

President Cyril Ramaphosa has called for investment-led trade between Africa and China.

This will help promote the industrialisation of African economies and position the continent as a global competitor. Such investments will also allow China to reap the benefits of a massive continental market.

“We should seek inward investment that enables industrial development and the export of more value-added products.

“We urge Chinese investors to take advantage of the great opportunities that will be created through the establishment of the African Continental Free Trade Area,” President Ramaphosa said on Monday.

The President was speaking at the opening ceremony of the 2018 Beijing Summit of the Forum on China-Africa Cooperation (FOCAC). The President co-chaired the two-day summit under the theme: “China and Africa: Toward an even stronger community with a shared future through win-win cooperation”.

The summit brought together 52 African countries, the AU Commission and the Peoples Republic of China as partners in cooperation. It aims to explore seven areas of cooperation over the next three years.

With the increasingly uncertain global environment, President Ramaphosa said the economic value of FOCAC – to both Africa and China – is particularly important.

Global economic volatility and heightened concerns about peace and stability render developing countries particularly vulnerable.

There is a renewed threat to the rules-based multilateral global trading system, which although imperfect, does provide stability, predictability and a greater degree of fairness.

FOCAC reaffirms shared commitment

“We should be using platforms such as FOCAC to reaffirm our shared commitment to multilateralism, a fair and transparent system of international trade and a global economic architecture that promotes the interests of the developing world.

“Africa is the next frontier growth market in the world,” said President Ramaphosa.

The FOCAC Cooperation was established in 2000 as a multilateral platform for exchange and cooperation between China and African countries.

It serves as an effective platform for south-south cooperation focused on the tangible improvement of the quality of lives of all the people of Africa by covering various aspects of politics, trade, economy, society and culture.

The President said the progress that has been made over the last 18 years demonstrates the tangible and lasting benefit of FOCAC to the people of Africa and to the people of China.

“The relationship that we have forged through FOCAC is premised on the fundamental and inalienable right of the African people to determine their own future. It is premised on the African Union’s Agenda 2063, a vision that has been crafted in Africa, by Africans.”

In the coming decades, President Ramaphosa said the FOCAC should be used as an instrument for youth development, to invest in building their capabilities and exposing them to the great possibilities that the world has to offer.

“Our objectives extend beyond the peoples of Africa and China. Together, we are working to build a community of shared future for all humankind. This requires leadership, vision and partnership.”

Eight major initiatives for Africa

President Xi Jinping used his address to announce that China will implement eight major initiatives with African countries in the next three years and beyond, covering fields such as industrial promotion, infrastructure connectivity, trade facilitation, and green development.

On industrial promotion, Xi said a China-Africa economic and trade expo will be set up in China and Chinese companies are encouraged to increase investment in Africa.

China will carry out 50 agricultural assistance programs, provide emergency humanitarian food aid amounting to 1 billion yuan (US$147 million) to African countries affected by natural disasters, and send 500 senior agricultural experts to Africa.

On infrastructure connectivity, Xi said China will work with the African Union to formulate a China-Africa infrastructure cooperation plan and support Chinese companies in taking part in Africa's infrastructure development by way of investment-construction-operation or through other models.

With regards to trade facilitation, Xi said China will increase imports, especially non-resource products, from Africa and support African countries in participating in China International Import Expo.

The least developed African countries will be exempted from paying exhibition stand fees, he said.

On people-to-people exchanges, Xi said China will set up an institute of African studies and enhance exchanges with Africa on civilization. China welcomes Africa's participation in the Silk Road International League of Theatres, the Silk Road International Museum Alliance and the Network of Silk Road Art Festivals.

On peace and security, Xi said China will set up a China-Africa peace and security fund and continue providing free military aid to the African Union. A total of 50 security assistance programs will be carried out in the fields including UN peacekeeping missions, fighting piracy, and combating terrorism.