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China is now a leader in financing infrastructure projects
in Sub-Saharan Africa
Accra, July 2, Ghanadot/GNA - China,
India and a few Middle Eastern Gulf Nations are financing a
record number of infrastructure projects across Sub-Saharan
Africa, a release from the Accra Office of the World Bank
said on Friday.
The release, which quoted a new World Bank report, said
investment commitments in Africa by these emerging
financiers jumped from less than $1 billion per year before
2004 to $8 billion in 2006 and $5 billion in 2007, signaling
a growing trend in cooperation among developing economies
(South-South cooperation).
Under: "Building Bridges: China's Growing Role as
Infrastructure Financier for Sub-Saharan Africa" the report
shows how new infrastructure partnerships are emerging,
driven by strong economic growth in the Region, an improved
business-friendly climate, and rising demand for petroleum
and other commodities from China and India.
Obiageli Katryn Ezekwesili, World Bank's Vice President for
the Africa Region, said: "China's success story in reducing
poverty through rapid and sustained growth is remarkable.
Massive investment in infrastructure was a key factor.
"Today China's growing infrastructure commitments in Africa
are helping to address the huge infrastructure deficit of
the Continent. There are of course challenges which will
need to be addressed by African nations and China coupled
with the support of development partners," he said, adding,
"by working together, we can create win-win partnerships".
The report said: "Africa faces daunting challenges in
improving its infrastructure. Development experts agree that
creaking infrastructure is cutting the growth rate of
African economies by as much as one percentage point every
year. One in four Africans does not have access to
electricity. Travel times on African roads and export routes
are two to three times higher than in Asia, increasing the
prices of traded goods. Power generation capacity is around
half the levels achieved in South Asia.
"The report notes that the investment commitments being made
by emerging financiers are unprecedented, both in scale and
the focus on large infrastructure projects. In a changing
world, with new actors and financing modalities coming into
play, there is a learning process for investors and
recipients. This will place new demands on national capacity
to negotiate complex and innovative deals, and apply
appropriate environmental and social standards needed for
the long-term success of such partnerships.
"Sub-Saharan Africa's natural resource exports to China have
grown exponentially, from just over $3 billion in 2001 to
$22 billion in 2006.? Petroleum dominates, accounting for 80
percent of total exports to China. Nevertheless, the bulk of
Africa's oil exports still go to the United States and
Europe, which together receive 57 percent of the total,
compared with only 14 percent going to China. Other
important African export commodities are iron ore and
timber, followed by manganese, cobalt, copper and chromium.
The World Bank is working closely with African countries,
China and other development partners in sharing experiences
so that the investments have the best development impact.
China is not the only emerging financier playing a major
role in Africa. In recent years, India is increasing its
investments, committing $2.6 billion since 2003. The bulk of
Indian investments were in Nigeria. Oil-rich Gulf states and
Arab donors are also playing a substantial role in African
infrastructure, committing on average $500 million every
year over the past seven years.
GNA
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