TheoldergenerationinChinacanoftenbeheardaffectionatelyreferringtoAfricansasfeizhouxiongdiorAfricanbrothers.Thistermofendearmentmostlikelyoriginatesfromatimewhentheatmosphereofsolidarityamongdevelopingnationswasbeginningtoemerge,manifestingingatheringsliketheBandungConference,andspurredbyChina鈥檚realizationofhowcrucialAfrica鈥檚supportwouldbetoitsintegrationintotheinternationalcommunity.AfricahaslongheldaspecialplaceinChineseforeignpolicywiththeForumonChina-AfricaCooperation(FOCAC)beingthemostsignificantembodimentsofthis.
ThelastgatheringofthistriennialforumtookplaceinJohannesburgin2015andconcludedwiththeadoptionoftheJohannesburgActionPlan,aroadmapforcooperationbetweenChinaandAfricainthethreeyearsuntilthenextsummit,tobeheldthisyear.
Lookingahead,theFOCACSummitofSeptemberisofparticularsignificancebecauseitcoincideswithkeyshiftsintheglobaleconomyandregionaldynamicsthatpresentanopportunityforbothChinaandAfrica.
Strengtheningglobaldemandunderpinnedbyanall-roundrecoveryofmomentuminthegrowthoftheglobaleconomyisallowingAfricaneconomiestostabilizeandgrowascommoditypricesrise.Giventhecentralrolecommodityrevenuesplayinthevitalityofeconomiesonthecontinent,Africacantakeadvantageoftherecoveringcommodityrevenuestoinvestintheadvancementofbroaderdevelopmentalobjectives.
AresultofthestructuralcharacterofmanyAfricaneconomiesisthattheirsectorialorientationtowardrawmaterialandcommodityexportsandimportsofmanufactureshasgenerated鈥渋mmiserizinggrowth鈥漮nthecontinent.ThekindofeconomicgrowthledbycommoditiesisnotnecessarilybringinggreaterprosperitytoAfricancountries.Thedetrimentaltermsoftradebroughtaboutbythesestructuraldeficiencies,alegacyofextractiveeconomiesestablishedduringthecolonialera,havelongbeenproblematizedbuttherehasbeenlittlesuccessinovercomingthem.ThishasprioritizedtheissueofeconomicdiversificationinmanyAfricancountries.CooperationwithChinahasbeenidentifiedasanimportantavenuethroughwhichtoachievethisinadditiontoexpandedintra-continentaltrade.
TheimportanceoftheFOCAChasbeenrecognizedbymemberstates.TrulyharnessingthepotentialthattheplatformofferswilldependonAfricanplayersdevelopinganacuteChina-awarenessandactivelyfindingwaystousetheFOCACframeworktoaddresstheiruniquechallenges.ChineseplayersmustlikewisecontinuetodevelopanAfrica-awareness,whichwouldentailbuildingthecapacitytonavigateeconomicrelationshipswithcountriesfarsmallerthanitselfsothatthesenseofreciprocityandmutualbenefitistrulyfelt.
Source:NationalBureauofStatisticsofChina
1/SouthSudanJune:ChinaandSouthSudansignedatechnicalcooperationagreementforthemodernizationofstatebroadcastersintheEastAfricannation.Theprojectcostestimatedat$15millionwillenabletheconstructionoftwostateof-the-artbroadcaststudiosandwillalsooffercapacitybuildingforSouthSudanesejournaliststhroughmediaexchanges.
2/EthiopiaJune:Ethiopia鈥檚Chinese-builtEasternIndustryZoneisexpectedtostarttheconstructionofthesecondphaseassoonasdemandsfromforeigncompaniesincrease.Therearecurrently83companiesunderconstructionoroperationalinsidetheindustryzone,ofwhich56havealreadystartedproduction.
3/Kenya&SouthSudanJune:AChinesefirmhaswonthetendertoconstructthefirsttarmacroadthatextendstoSouthSudanfromKenya鈥檚northregion.ChinaNationalAeroTechnologyInternationalEngineeringCorp.hasbeencontractedtoundertaketheconstructionofthe60-kmroadworth$20millioninaregionreferredtoasKenya鈥檚breadbasket.
4/ZimbabweJune:ZimbabweandChina鈥檚TsingshanHoldingGroupsigneda$1-billionMoUforestablishingasteelplantintheMidlandsProvincethatcanproduceupto2milliontonsofsteelperannum.Whenfullyoperational,thisprojectisexpectedtocreate3,000permanentjobsoverthelifeoftheprojectwhichisestimatedat25years.
5/NamibiaJune:NamibianPresidentHageGeingobofficiallyinauguratedtheOshikotoPoliceRegionalHeadquartersandtheOmuthiyaPoliceStationsituatedinthenorthofthecountry.ThefacilitieswereconstructedandcompletedlastyearbyChinaJiangxiInternationalNamibia.
ForeignInvestmentRobustDespiteConcernsOverTrade
InthelastmonthofQ2,theChineseeconomydemonstratedahighlevelofresilience.AsinternationalconcernsfomentoveratradespatwiththeUnitedStates,therenminbi(RMB)fell3.1percentagainstthedollarwithinthemonthofJune,itsbiggestmonthlydropsince1994.Marketsalsoshowedsignsofcaution,astheShanghaicompositeindexfell6.4percentto2,847.42onJune29.Signsofanunderlyingstrengthemerge;however,asforeigninvestorsputheavybuysonRMB-denominateddomesticbonds,causing10-yearyieldstodecreasebelowthe3.5-percentagemark.
ManufacturingActivityReflectsSlowingEconomy
OnthebackofstrongperformanceinMay,China鈥檚manufacturingsectorgrewataslowerrateinJune.WhileMaysawapurchasingmanagers鈥檌ndex(PMI)at51.9,itdroppedto51.5inJune.Thisslumpisattributedtoseveralfactors,includingslowercreditgrowthamidgovernmentcrackdownsoncertaintypesoflending,slowinginternaldemandindicatedbyslowergrowthinretailsales,anduncertaintyaroundexternaldemandwithrisingtradebarriersintheUnitedStates.Furthermore,theemploymentsub-indexindicatesthatChinesefactorieshavelaidoffthehighestamountofstaffsinceJuly2017.Thesefactorsareallindicativeofaslowdownintheeconomy,butthisprocessisgradual.
BRIGetsaBoostinHK
TheThirdBeltandRoadSummitwasheldinHongKongontheJune28,andwasattendedbyover5,000participantsfrom55countries.ThethemeoftheeventwasCollaborateforSuccess.ThesummitservedtocreateanopportunityforexistingpartnerswithintheBeltandRoadInitiativetocollaboratefurtherandtoincreasecooperationbetweennations.VariousMoUsweresignedatthesummit.Thesummitwasusedasaplatformforpartnerstoemergeinnewandexistinginvestmentprojects,bygivingprojectsthemarketingtheyrequiretosucceed.ProjectsbeinginvestedinbyChinaincludethedevelopmentofasmartcityinThailand鈥檚EasternEconomicCorridor.
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