China signs US$6.5b deals in S. Africa
Print Edition
CHINESE President Xi Jinping presided over the signing of agreements and loan deals with South Africa worth 94 billion rand (US$6.5 billion), mainly to build infrastructure in the continent’s most industrialized nation.
South Africa’s President Jacob Zuma hailed relations between the two nations as at their “best ever” after the two leaders held talks focussed on boosting investment and addressing a trade imbalance that favors China.
“China and South Africa relations are at a new historical level. We want to build it into a model for relationships between China and other emerging economies,” Xi said at a news conference following the talks.
China has made a string of cheap loans in the past few years to countries in Africa, a continent which supplies oil and raw materials such as copper and uranium to the world’s most populous country and second-largest economy.
Xi, who began his tour of Africa in Zimbabwe on Tuesday where he pledged loans to revamp that country’s ailing economy, will also co-chair a two-day Forum on China-Africa Cooperation which is due to begin in Johannesburg today.
Several African heads of state are expected to attend the summit, with discussions centring on how much China will extend in new loans as its own economic growth slows, while African nations may push for debt moratoriums and technology transfers.
Nigeria’s President Muhammadu Buhari will ask Xi to fund rail and power projects urgently needed to diversify an economy hit hard by a plunge in oil prices, a spokesman said.
As part of the 26 deals signed on Wednesday, China will lend South Africa’s cash-strapped power utility US$500 million.
The two countries also signed a deal to improve cooperation in nuclear power, but gave no details.
South Africa is in the throes of a chronic electricity crisis that is increasing costs for industry and discouraging investment. Part of its response is to build new nuclear plants that experts say may cost as much as US$100 billion.
China will also help to build a car manufacturing plant on South Africa’s coast which should begin exporting vehicles to other African countries by the end of 2017.
South African Investec, a Johannesburg-based investment bank and asset management firm, agreed to work with China Export-Import Bank to enhance export finance, project finance, and the internationalization of China’s currency and its use as a settlement currency in trade.
China’s Credit Insurance Corp signed a deal to provide state-owned logistics firm Transnet with US$2.5 billion in loans to pay for contracts and equipment with Chinese companies.
The two nations also agreed to waive visa requirements for diplomatic and government passport holders.
Xi yesterday urged China and Africa to work together toward win-win cooperation for common development within the framework of the Forum on China-Africa Cooperation.
In an address delivered for Chinafrica magazine’s special issue for the upcoming Johannesburg summit, Xi noted that China and Africa form a community of shared future.
Chinafrica is a monthly magazine in Africa issued by China International Publishing Group.
“We have long stood together through thick and thin and are now facing unprecedented opportunities for cooperation,” Xi said.
China highly values and sincerely supports Africa’s development, which has profound implications for advancing the lofty cause of peace and development of mankind, he said.
“Chinese and Africans will remain good friends, partners and brothers forever,” Xi said, stressing that China will continue to uphold the guidelines of its Africa policy — sincerity, real results, affinity and good faith — and a balanced approach to principles and interests.
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