Briefing from ROAPE Volume 33 Number 110
China: Africa's New Business Partner
Chinese investment in Africa still lags behind that from the US and Britain, but a recent World Bank study records its ‘astonishing’ growth in the four years to 2002; and more is on its way. ‘Within five years’, estimates one independent economist, ‘China could be one of the top three investors on the continent’. Two-way trade between Africa and China was some $18 billion in 2004, a nine-fold increase on 1999; and Chinese officials expect it to grow to $30 billion within two years. &break;Oil is the current major attraction. China became a net importer of oil for the first time in 1993. But such has been its amazing growth rate that in little more than a decade it has become dependent on imports for more than half its oil needs. By 2020, its domestic production will account for less than 30% of its oil consumption. During 2003-04, a surge in economic activity, stimulated by government policy, drove up the demand for oil in China by 25%, while domestic output rose by just over 3%. Over this period, China accounted for 30% of the incremental global demand for oil imports.