08:37 am
25 October 2016

African Countries Consider Adopting Chinese Yuan as Forex Reserve

It would be recalled that at the opening meeting of the Forum, Chinese President Xi Jinping told African leaders that his country would pump $60 billion (39.71 billion pound) into development projects, cancel some debt and boost agriculture under a three-year plan that will extend Beijing’s influence in the continent. The two-day summit is expected to adopt the Johannesburg Declaration and Action Plan to outline aims and steps to build on the growing China-Africa partnership.


“We also put up regional vocational centres to boost capacity building”, President Xi said.

Relations between African countries and China are entering a critical phase as both sides focus attention on areas that generate real benefits to citizens, Kenyatta said.

South Africa’s state-owned companies such as Eskom, Transnet, the Industrial Development Cooperation (IDC) and the South African Nuclear Corporation also had their own share of agreements.

It is not only endowed with a long and splendid history but blessed with a great prospect of dynamic development, said the Chinese president, who traveled to Africa in his first foreign trip after taking office in March 2013 and once called the tract of vibrant land “the continent of hope and promise”.

But on Wednesday, Gigaba said the Ebola virus in Africa was partly to blame for the drop numbers of Chinese tourists visiting South Africa rather than visa requirements.

The $60 billion pledge is three times as much as the package promised at the last China Africa cooperation summit in 2012, said economist Aubrey Hruby.

China’s trade with Africa is largely import-driven, with the world’s second-largest economy buying oil mostly from Nigeria, Angola, Equatorial Guinea, Ghana, Cameroon, the Republic of Congo, Gabon, Uganda, South Sudan and Sudan, and feeding the demand for cheap Chinese products in these countries.

Unless South Africa added more value to its exports to China, the trade gap would continue to widen as 80 percent of South Africa’s exports to China were mineral commodities.

He added: “The strategic partnership between Africa and China is vital to achieve development goals”.

More specifically, the declaration will facilitate the implementation of projects contained in the African Union’s Agenda 2063 strategy, which includes the development of a continental high-speed railway network, a unified African aviation market and the creation of a free trade zone.

He, however, said that there was the need for investment flow into the continent to make Africa economy survive the global economic meltdown.

“If Africa because of low mineral prices and unreliable host governments becomes unappealing, there are other places for these funds to be diverted to”, Mr Xue said.