China Center for International Economic Exchanges

Wei Jianguo: China’s Enterprises Help Africa’s Manufacturing Kick-off
Date:Sep 06,2017    Source:CCIEE

The Belt and Road Forum for International Cooperation, held in Beijing last May, elated a lot of African people as they hope that China, its all-weather partner, can help them to realize their manufacturing dream quickly. Chinese private companies are also eager to invest in the manufacturing industry of Africa. According to McKinsey, a well-known US consulting firm, there are now more than 10,000 enterprises in Africa, of which 90% are private and 1/3 of them engage in manufacturing. Chinese enterprises account for 20% of the manufacturing industry in Africa, more than 48% of the Chinese firms introduced new products and services to Africa and 36% of them have increased the introduction of new technology and training of local labor force. Another report of McKinsey indicates that China has already become the major force driving the modernization of manufacturing in Africa.

During his visit to South Africa, China’s president XI Jinping and South Africa’s president Jacob Zuma witnessed the signing of the Agreement on Jointly Building Industrial Park and since then, the Atlantis industrial park in Cape Town, South Africa has been crowded with people and vehicles all day long. Dozens of Chinese companies producing TV parts has started production in the industrial park and thousands of local workers walk into the spacious and bright production workshop. The industrial park produces annually more than 500,000 TV sets of various sizes, which not only satisfy the local demand but also export to more than ten countries, including Canada, Uganda, Nigeria, and Cameroon. In total, the industrial park created 15,000 local employments and paid a total of 28 million dollars in tax.

In the past ten years, the production, employment, trade and FDI of the manufacturing in Sub-Saharan Africa alone has doubled, from 73 billion US dollar in 2004 to 157 billion US dollar in 2015, which is unprecedented in the history of Africa. The media in Africa believe that China’s investment has reshaped Africa’s manufacturing, especially China’s private companies who invest more than 150 projects in Africa which have accelerated the industrialization in Africa. Currently, there are approximately 8,000 Chinese companies in Africa and they invested about 4,000 projects in architecture, manufacturing, IT industry, infrastructure and energy sector. Furthermore, there are 3,000 projects are under negotiation and the implementation of all these projects gave the African people a real sense of gain and they feel that China’s manufacturing has changed the entire Africa. For example, the total local assembly of China’s smartphone maker HUAWEI overtook iPhone and Nokia and become the second largest brand after Samsung. Apart from that, locally processed and produced electronic cars, cars, diggers, bikes, refrigerators, washing machines and stereo system can be easily found in people’s daily life.

Mauritius is the only African country which designated China’s spring festival as a statuary holiday. Its Ambassador to China told me that thanks to China’s help, the progress made by the manufacturing in Africa is no longer like a leapfrog but a leopard’s leap.

There are now more and more Chinese industrial parks, processing workshops and economic and trade cooperation zones scattered throughout the vast land of Africa. More than 20 industrial parks of various types have been constructed and 30 more are under discussion. About 1,000 companies are in production, which have created local jobs for approximately 100,000 people and paid a total tax of 700 million US dollars.

The agriculture-dominated African continent is moving to the new era of industrialization and after the conclusion of the Belt and Road for International Cooperation, more heads of states and governments want to visit China and hope that China’s manufacturing can help its economic take-off. Just like the president of the industrial park in Suez, Egypt said “What we need is China, not neocolonialism.”

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