Chinese blueprint 'best for Africa'

Continent needs to act on policies that helped create one of the miracles of the modern world, ministers agree

The blueprint for Africa's renaissance may be found in Chinese economic and social policies that led to phenomenal growth in the past three decades, experts said during this month's African Development Week in Addis Ababa, Ethiopia.

The annual meeting, jointly convened by the African Union and the United Nations Economic Commission for Africa, attracted more than 200 delegates.

Two dozen side events preceded a two-day ministerial forum that saw senior government officials discuss a master plan for African development and the global Sustainable Development Goals that the UN agreed on for 2015 to 2030.

The experts, tasked with preparing and presenting reports formulating Africa's plans to achieve structural transformation, say that besides China serving as a blueprint, its ongoing engagement with Africa supports sustainable growth.

Issues touching on China during the week included financing, regional integration, immigration, bilateral treaties, skill development and the role of media in pushing Africa's agenda.

Financing was discussed amid a backdrop of rising sovereign debt by African governments intent on funding mega infrastructure projects. China has loaned funds to a number of African countries, and in December, $60 billion in new financing was promised by President Xi Jinping during the Forum on China-Africa Cooperation in South Africa.

"Borrowing is not a really a bad thing as long as the funds are channeled toward intended projects which promise to have a long-term multiplier effect in the economy," says Charles Lufumpa, acting chief economist of the African Development Bank.

He says countries borrow to support development of key infrastructure projects that have pushed ahead the regional integration agenda, especially in East Africa.

"Last year a lot of our loans and grants, totaling $9 billion, went into transport projects that are reducing interregional costs. There has also been noticeable activity toward increasing energy production, which is improving the continents' competitiveness," he says.

In the latest construction trends report by Deloitte, an audit and advisory firm, China emerged as the dominant builder and investor, save for international donors of key infrastructure installations in East Africa.

Out of total projects worth $57.5 billion, China funded 8 percent and built 21 percent.

One of the most notable projects is the ongoing construction of the standard gauge railway between Mombasa and Nairobi that saw Kenya borrow 90 percent of the $3.8 billion project from Export-Import Bank of China. This has been followed by $1.5 billion to extend the line to Naivasha and another contract to allow the country access to $5 billion to move the line to the Ugandan border.

The modern railway is expected to fuel interregional trade as it connects the hinterlands of Rwanda and South Sudan to the port of Mombasa in Kenya.

According to the Regional Integration Report released by UNECA, the region has fast-tracked its integration and leads other regional blocs. This is attributed to the expanding infrastructure stock together with implementing policies that strengthen common market protocols and relax visa requirements.

But most importantly, according to Charles Njoroge, deputy secretary-general of the Political Federation of the East African Community, China is prominently involved in promoting peace and stability in the region. This, he says, proves that its engagement is long term and positive.

Njoroge says the region is looking at healthy growth through plans for relocation of China's industrial overcapacity. He says this is particularly exciting because the regional governments are pushing ahead with plans to ban imports of secondhand clothes and is banking on revival of the textile and leather industries.

"Our presidents are very keen on this issue and the Chinese factory-relocation plans are welcome. We want to be net exporters of finished goods, which will increase our presence in the global value chains that have eluded us in the past as we continue being net exporters of raw materials," says Njoroge.

Such plans are expected to be implemented using special economic zones, which use favorable policies to encourage industry, a concept that Africa is keen on borrowing from China.

Paul Jourdan, a mineral policy analyst from South Africa, predicts that Africa's economic transformation hinges on bilateral treaties that give credence to value addition. One way of achieving this is by replicating China's success in special economic zone initiatives.

Ramping up the manufacturing sector will also catalyze skill development, an important but missing link to Africa's success.

Emmanuel Nnadozie, executive secretary of the African Capacity Building Foundation, a Harare-based organization, believes that Africa would do well to borrow from China's Thousand Talent Program.

The initiative recruits top-notch talent and experts from home and the Chinese diaspora for major programs critical to sustaining economic growth.

"We can learn from China. The program has had a significant impact on its economy by attracting scientists and leading experts in innovation and technology who are behind critical breakthroughs and advanced new disciplines," Nnadozie says.

A joint survey by the foundation and the African Union has revealed serious skills shortages in the continent. According to Nnadozie, Africa cannot achieve sustainable development without ramping up its skill capacity.

"To give you a glimpse of how critical this is, Africa is in dire need of 4.3 million engineers to achieve its infrastructure development goals by 2020. This seems an uphill task considering that 80 percent of our graduates have majored in social sciences," says Nnadozie.

David Luke, the researcher behind a UNECA report entitled Innovation, Competitiveness and Regional Integration, attributes China's meteoric rise to its investment in human development.

Lucymorangi@chinadaily.com.cn

(China Daily Africa Weekly 04/22/2016 page3)