SHARM EL-SHEIKH: Chinese Premier Wen Jiabao pledged $10 billion for investment in Africa at the third triennial Forum for China-Africa Cooperation (FOCAC), topping investments of $7.8 billion in 2008.
On-hand to attend the announcement were Prime Minister Ahmed Nazif and Trade and Industry Minister Rachid Mohamed Rachid representing Egypt, as well numerous African ministers, and over 800 Chinese and African entrepreneurs.
Prior to the announcement, business people mingled in hopes that partnerships would emerge from face-to-face encounters.
When asked about his company’s agenda for the conference, Johnny Xu, CEO of Aosheng Hi-Tech Composite Materials Company, responded, “We are looking for corporate customers in Africa, but not any country in particular.
Joy Qi is general manager of a Chinese company, Sinotech, already partnered with an Egyptian business. Her company sought a Chinese producer of alternative energy technology; “we want a Chinese supplier interested in producing solar energy in Egypt. Her Egyptian partner muttered to her that none of the energy companies represented were large enough to suit their needs.
Magdy Amer, managing director of Red Sea Power Co. Ltd., also attended the conference to find a Chinese manufacturer for wind and solar energy, as well as representatives from African countries interested in alternative energy products. He was likewise unable to find a suitable company due to the lack of information about the other businesses in attendance and the varying degrees of development achieved by the countries represented.
“The Chinese are developing alternative energy, but in many African countries awareness of wind and solar energy is still minimal, he complained.
The dearth of information about fellow attendees remained a frustration even when potential partners found each other. If another company showed promise, their interaction evoked “speed-dating, as companies tried to size each other up based on the informational brochures each had brought.
A member of one of Egypt’s development banks who wished to remain anonymous expressed his frustration with the conference.
“This is a waste of time. There’s no way for us to know anything about these [Chinese] companies, they could be second or third rate, we don’t know. It doesn’t make sense for us to meet at the introductory stage. A businessman has to do his homework and know which companies he wants to partner with. Then he can arrange a meeting with them. This is just a photo opportunity, he said.
The language barrier was also cited as a frustration, as many of the Chinese entrepreneurs did not speak English, the language in which most of the African attendees were prepared to interact.
Onesimo Mazai Moyo, chief executive of the Minerals Marketing Corporation of Zimbabwe, stated that while the English language had served its purpose in helping to establish initial contact networks between developing countries, there is no reason that it should remain the global lingua franca.
“We’d rather have it [the conference] in Chinese. We can better appreciate each other’s cultures if we learn each other’s languages, he said.
Although Zimbabwe currently has the advantage of an English language education system, in the future English could be less of an asset. The CEO of the Zimbabwe Investment Authority, Richard Mbaiwa, agreed.
“Now Chinese children may be learning English in school, but the current generation of Chinese businesspeople have fewer English skills. It is hard for them to learn English now, and for me to learn Chinese. But I want my daughter to learn Chinese; in the future, why should we learn English?
There was little talk of Chinese entrepreneurs learning African languages.
When presenting proposals to the China-Africa Development Fund (CADF), a subsidiary of the China Development Bank launched in 2007, African entrepreneurs distinguished themselves by providing documents in Chinese. Many African companies seeking funds also asked for advice from CADF’s representatives on everything from how to win an investment to which sectors were considered high-priority.
CADF Chief Investment Officer Yong Wang explained that the fund chooses companies based on their financial and technological feasibility, and the extent to which they will benefit the community.
Already funding 20 projects with over $500 million, Wang expects the amount to increase to $615 million by the end of 2009, partly as a result of FOCAC. He cited the example of a Tanzanian project to grow and process sisal, a yucca-like plant native to Mexico, used for fiber and rope-making.
“The project will employ approximately 2,600 local workers. We expect a return on the investment after the plants reach maturity in six years, Wang explained. “We look for projects that local governments consider important. But we’re a private company. We also have to look after our own interests.
However for many Chinese entrepreneurs, FOCAC represented a chance to see the continent that has become one of their country’s highest priority investments. Tie Jianshe, chairman of China Council for the Promotion of International Trade, Zhejiang Sub-council, said of Egypt, “The climate is very dry. I think it is hard for us to get used to.
Representative of Angola’s Ministry of Planning, Gabriel Leitao, said “China came at a crucial moment for Africa. Angola in particular was just coming out of the war and looking for help from the international community. We have developed bi-lateral cooperation with China and now can help other countries develop their relationship with China.
Angola currently receives more Chinese money and workers than any other African country.
Tie Jianshe summed up the inevitability of Chinese involvement in Africa. “We have a saying in Chinese. ‘It takes a century for a business to mature.’ That is our attitude towards Africa.
