Foreign investment in Ghana
Doubles with China as Arrowhead
Williams Ekanem and agency Reports
Foreign direct investment in Ghana doubled to
$1.11 billion in 2010, with China leading the number of investment projects,
the government has said.
"The year 2010 ended with a
total of 385 projects with a total estimated value of $1.28 billion.
The FDI component of this figure is
$1.11 billion, a significant increase compared to $551.30 million recorded in
2009," the Ghana Investment Promotion Centre said in a release.
China led the number of registered
projects with 67, it said, and came in fourth in terms of estimated cost of the
projects behind Bermuda, Nigeria and Trinidad.
Ghana, one of a handful of
sub-Saharan countries with a Eurobond GH032376037=RRPS, is expected to post
Africa's fastest rate of growth in 2011 after starting commercial oil
production last month.
The West African country is also
the continent's second-largest gold miner and the world's No. 2 cocoa grower.
China has expanded its presence
across the resource-rich continent in recent years as it seeks to lock up
long-term energy and commodities supplies to fuel its rapid growth.
Meanwhile, China's vice commerce
minister pushed back against Western criticism of China's activities in Africa,
describing Chinese investment as "more market-driven" and defending Beijing's
stance on recent flare-ups.
Chinese workers construct a
government housing project in Algeria.
Economic activity in Africa has
surged in recent years, with Beijing becoming an important investor, creditor
and donor for many African nations. But with the rise of China's influence upon
the continent, concerns persist that Beijing is preying on the continent's
resources to feed the Chinese economy, contributing little significant
improvement to African livelihoods.
Amid such criticism—and as China asserts
that its presence in Africa is increasingly being shaped by non-government
actors—Beijing has put in place some mechanisms to deal with issues surrounding
its investment and trade on the resource-rich continent.
"China's presence in Africa is
becoming more and more market driven, the actors operating there are diverse,
there are many models, and the areas they are in are broad," said Fu
Ziying, the vice commerce minister, in a recent interview. "The Chinese
government is more and more aware that as the economic and trade cooperation
between China and Africa evolves, there need to be some laws and protections in
place."
In a rare discussion about
China-Africa ties, Mr. Fu, the senior trade official in charge of China's
Africa portfolio, spoke about what he termed the misunderstandings surrounding
China's presence in Africa.
In response to questions about some
sensitive cases in the past year related to China's moves in Africa, Mr. Fu's
comments suggested there were limits to what the government could do, shedding
little light on the controversies.
Last year, a Hong Kong-based entity
named the China International Fund struck a massive, $7 billion mining and
infrastructure deal in Guinea that gave it, through two Singapore-registered
entities, sweeping concessions to the mineral riches of the West African
nation. Guinea authorities are now investigating the deal.
Company filings and other documents
show that some CIF executives have ties to a Chinese state-owned enterprise.
Mr. Fu reiterated denials by Chinese government officials that the government
has any involvement in CIF.
"This fund is entirely built by
individuals, and it has absolutely no government or Chinese state-owned company
background in it," Mr. Fu said, adding that the Chinese government took
the step to "inform relevant countries" that no such fund is
registered in China.
Meanwhile, when asked about the
investigation by Namibian authorities into alleged bribery involving Chinese
security-equipment provider Nuctech Co., Mr. Fu said the matter was a
civil-commercial dispute, arising from commercial competition, and that the
Chinese government wouldn't intervene in such cases.
Mr. Fu, who accompanied powerful
Politburo member Jia Qinglin to Namibia in March, said that the Nuctech case
hadn't come up during the visit. Neither Nuctech nor its parent company has
commented on the investigation.
The probe, which emerged late last
year, is sensitive because the Communist Party Secretary of Nuctech's parent
company is Hu Haifeng, the son of Chinese President Hu Jintao. References to
the case disappeared from Chinese news websites soon after the story surfaced.
Mr. Fu also expressed frustration
over persistent criticisms against China by Western nations and multilateral
development agencies, which have cited Beijing's lack of transparency in its
dealings in Africa and that the financing it provides without conditions on
better governance or tackling corruption sets back the local economy.
"It's like marriage. The
husband and wife are happy. Their happiness quotient is very high. But suddenly
you have someone beside you that keeps criticizing the marriage," he said.
"If Africa has a criticism about China's investment in Africa, then that
is a problem."
China's engagement with Africa has
begun to be studied only in the past few years. One recent study by the Centre
for Chinese Studies at South Africa's Stellenbosch University and the
Rockefeller Foundation listed the development of local worker skills and labor
rights as key challenges that may determine whether Africans will benefit from
China's presence on the continent in the long run.
The study also recommended more
joint ventures be set up between African and Chinese companies to transfer
technology and build capacity and an increase in the role of African civil
society in project consultations.
This year China-Africa trade will
exceed $100 billion, and the growth in bilateral investment is likely to enter
its fastest period in the next five years, Fu said. Last year, trade between China and
Africa fell to $91 billion amid the global financial crisis, from $107 billion
in 2008, according to Chinese government data.
In 43 African countries, China and
the corresponding African nation have set up a joint committee that convenes to
discuss economic and trade issues when needed, Mr. Fu said. Such committees
often don't meet more than once a year, and Fu indicated that there are cases
that end up outside of that framework. But he claimed that, along with
agreements on bilateral trade and investment protection, they offer a way to
smooth burgeoning ties between the two developing economies.
Fu also responded to a question about a case
involving investment in the other direction, from Africa into China. South
Africa's Sasol Ltd. in
December submitted a plan with its Chinese joint venture partner to build a
plant that will convert coal to liquid fuel in China. The project, estimated to
cost $5 billion to $7 billion, would be among the largest by an African company
in China.
However, a document prepared by the
local-level economic-planning agency in Ningxia, where the plant will be
located, said that the review of Sasol's plan was being delayed to await a
rival plan based on Chinese technology. Sasol has said it remains confident in
the project.
"This [Sasol's] project hasn't
been rejected," Fu said, adding
that at issue is still a broader question of whether it is better to stick to
using crude oil or convert coal to oil for China's energy needs.
Fu himself led a delegation in April to five
African countries: the Central African Republic, the Republic of Congo, Gabon,
Liberia and Chad.
In Liberia, where China is carrying
out a $2.6 billion project to revitalize the iron ore Bong Mines, Fu said his group convened a roundtable with
senior representatives, including ambassadors, from the local embassies,
including ones from the U.S. and EU, along with foreign and local media.
Fu said the roundtable, including another one
set up while he was in Gabon, was done to address the misunderstandings of
China in Africa.
