RPT-China in Africa to stay, no matter political risk
15 May 2007 04:45:47 GMT Source: Reuters
(Repeats to additional subscribers.) By Lindsay Beck SHANGHAI, May 15 (Reuters) - China is no fair-weather friend to Africa. That's the message its officials and companies are delivering to the continent as Shanghai prepares to host the May 16-17 annual African Development Bank meeting. A raid last month on an oilfield in Ethiopia that killed 74, including nine Chinese, prompted questions over whether China might curb its growing business interest in Africa. But analysts say while such incidents may force China to become more involved in domestic politics, however reluctantly, Chinese companies are in Africa -- even its riskiest countries -- to stay. "My judgment is that, individual events should not affect the implementation of overall strategy," said Chu Tianshu, a development economist at the Southwestern University of Finance and Economics in Chengdu. Another seven Chinese were briefly kidnapped in the Ethiopia raid, carried out by the separatist Ogaden National Liberation Front. Chinese workers have also been taken hostage in Nigeria and its oil interests in Sudan are under heavy guard. But China needs resources in Africa, where it faces relatively little competition from Western companies, to feed its economic boom, and scaling back investment now would undermine its message that it is a long-term, stable friend to Africa. China said this week it would increase security spending to protect its overseas workers against "terrorist attacks, conflicts, natural disasters and other threats", but also encouraged its companies to stay the course. "China will not change its policy of encouraging its firms to cooperate with all countries, including those in Africa," the official Xinhua news agency cited Foreign Ministry spokesman Liu Jianchao as saying. With most of the 800 Chinese companies operating in Africa state-owned, the official line counts. "It's political stakeholders who are deciding the strategy here," said Martyn Davies, the director of the Centre for Chinese Studies at Stellenbosch University in South Africa. LONG-TERM PLAN Liu Guohua works for a copper company based in the southwestern province of Yunnan that has investments in Zambia's Chambishi copper belt, which has been the site of worker unrest. He concedes there are risks, but says it is the bigger picture of whether there is government support on both sides that counts. "Relations between our countries are increasingly stable, so risks are declining over the long-term," he said. What may change though is China's adherence to its mantra of non-interference in domestic affairs of other countries as it seeks to ensure security for its workers and investments. "I think they would prefer to maintain the non-interference policy, but in a lot of different situations in Africa that isn't tenable anymore," said Adam Wolfe, an analyst with Power and Interest News Report. But as China's presence in Africa grows and it gets sucked into more domestic affairs, analysts say it will have to tweak its foreign policy if it is to be able to stay abreast of new situations it may confront. "I don't think its foreign policy is geared toward reacting to these things... and I think it will have to become a lot more sophisticated to be able to operate in this new environment in which it finds itself," said Davies. Chinese enterprises have already invested more than $6 billion in Africa, and they are engaged across sectors, not just in energy and mining, but also in construction, infrastructure and textiles, industries that are supporting a growing band of Chinese entrepreneurs moving to Africa. There may be dangers, but China is gambling they are outweighed by the strategic and commercial benefits. "They'll still take risks that other, Western companies wouldn't," said Wolfe.
