China Pledges $20 Billion in Loans for Africa
Views:884 | Thursday, July 19th, 2012 | By somaliradio
Chinese President Hu Jintao has pledged $20 billion in new loans to African governments over the next three years, expanding an already rapidly growing China-Africa relationship and giving Beijing even more access to the resource-rich continent.
The loans, outlined Thursday by President Hu Jintao at the opening of a summit with African leaders in Beijing, were double the amount offered at the last forum in 2009.
"China will provide $20 billion in credit to African countries, mainly to support the infrastructure, agriculture, manufacturing, and the development of medium-small-sized enterprises of African countries," said President Hu at the Forum on China-Africa Cooperation.
The rapid expansion of Chinese investment has prompted concerns about labor abuses and corruption, as well as accusations that China is overlooking human rights issues in Africa in its pursuit of economic prosperity.
President Hu appeared to soften some of that criticism in his speech Thursday in announcing an expansion of aid to Africa. He promised China would offer thousands of scholarships for African students, train medical personnel, improve drinking water conditions, and address environmental concerns.
"China wholeheartedly and sincerely supports African countries to choose their own development path, and will wholeheartedly and sincerely support them to raise their own development ability," said Mr. Hu, promising that China would be a "good friend, a good partner, and a good brother."
Dozens of high-level African officals are attending the summit. Among them is South African President Jacob Zuma, who says he welcomes more Chinese investment. But he also warned that the unbalanced nature of the trade relationship was "unsustainable in the long-term."
"We are particularly pleased that, in our relationship with China, we are equals," said President Zuma. "But Africa's past economic experience with Europe dictates a need to be cautious when entering into partnerships with other countries."
China-Africa trade grew to a record $166 billion in 2011, according to government figures, while Chinese investment in Africa reached $14.7 billion by the end of last year.
Jeremy Stevens, an economist at the Standard Bank Group of China in Beijing, says that China's growing interest in Africa is a reflection of global interest in Africa's investment potential and growing consumer market.
"China recognizes that Africa's resources matter and will continue to matter to its own industrialization organization. And China quite obviously recognizes that Africa is one of the few places where there are new finds of minerals each year that are becoming cheaper to access as infrastructure improves," he said.
Stevens says concerns that China is overlooking human rights abuses are justified. But he says it is ultimately up to African leaders to ensure the economic benefits of doing business with China actually help the people of Africa.