Chinese Premier Wen Jiabao recently ended a seven nation tour of Africa on June 25 in a bid to improve economic, social and diplomatic ties between China and Africa.

Following his whirlwind trip June 17th, many still wonder what it will mean for the continent. Can the visits be described as yet another mad “scramble for Africa”? Or can they instead be seen as a “wave of change blowing across Africa”?

As issues which include human rights, and environmental development were being mentioned by the press during the visit, there were also questions about what the residual effects of the trip would mean for Africa as a whole and for each of the nations visited. More specifically, who would benefit most from the strengthened ties? Africa or China?

China’s Drive

China is the world's fastest growing economy. Its GDP rose 9.5 percent in 2004, its largest increase in eight years, and has grown by an annual 8 percent over the past decade. There was a partially rapid rise from a low base, but it’s also a result of ongoing economic reforms, which include joining the World Trade Organization in 2001.

With the immense quantity of manufactured goods that China is rapidly producing, as well as a pressing need to upgrade its infrastructure China is in demand for a constant supply of a variety a natural resources, hence China’s interest in Africa.

According to Chinese government statistics, China's overall trade with Africa rose from US $10.6 billion in 2000 to $40 billion last year and continues to increase. Growth since 2001 has increased an average of 31.2 percent a year.

“Year of Africa”

China is now giving Africa exceptional amounts of diplomatic attention after a five-year period in which its trade with the continent, driven by growth in oil imports and manufactured exports, has risen fourfold. In Beijing, senior foreign ministry officials call this year “China’s year of Africa”.

The attention proves to be a clear sign that China becoming a serious player on the continent. As a result of China’s growing access to oil in Africa, this could have a two-way effect; it could either set off new, intense power rivalries on the continent, or bring about new forms of valuable affiliations.

Oil is one of the main natural resources that China is interested in importing from Africa. Angola has taken over Saudi Arabia’s role as China’s main supplier of oil.

Jiabao placed emphasis on the promotion of bilateral trade and economic co-operation by “deepening ties with Africa” during his weeklong visit.

The seven countries the Chinese premier visted included; Egypt, Ghana, the Democratic Republic of Congo, Angola, South Africa, Tanzania and Uganda. A total of 71 trade agreements were signed during that time.

China has funded various projects throughout Africa over the last 20 years. Among those has been the construction of football stadiums, assembly plant building, new textile mills, as well as hospitals and hydropower stations. China has even contributed toward building a broadcasting station in Congo

Recalling that China and African countries have supported each other over the past decades, Jiabao said that as the Chinese economy has been developing; the eastern economic giant hasn’t forgotten its African trading partners.

China is aware that many African nations face constant political upheavals that often destabilize business ventures. Recently a spate of kidnappings of oil workers in Nigeria has been cause for concern in commodities markets.

On the political front, China will not interfere in internal affairs of African countries. We believe that African countries have the right and capability to solve their own problems, he said.

South African Link

China’s main trading partner in Africa is South Africa. Trade between them has grown significantly since the two countries forged diplomatic ties in 1998. Chinese imports to SA and South African exports to China grew 30 percent between 2004 and 2005. China was South Africa's second-largest import trading partner in 2005, comprising 9 percent of total imports, and eighth-largest export partner, comprising 3 percent of total exports from South Africa.

In addition, China has a generous trade surplus with South Africa: in 2005, imports from China totaled $4.45-billion, while exports came to $1.24-billion.

China’s shift up the production value chain is raising the bar of competition for all South African manufacturing industries.

Developing states’ manufacturing sectors are being challenged, finding it difficult to compete against Chinese imports. South African textiles, garments, footwear and machine-tool industries have all suffered severe dislocations as Chinese imports have poured into South African market since it opened in 1998.

China’s effect on the textile industry has received much attention as South African firms have protested the products being imported into the country.

Jiabao said that China was prepared to limit clothing and textile exports to SA to ensure stability in the domestic market. The premier signed an agreement to do so during his visit, a move greeted by Igsaan Salie, the president of Textile Federation SA, as fantastic news.

However Hassim Randeree, president of the Clothing Trade Council of SA, said that what he had understood of the agreement was nothing new. He pointed out that any agreement was just a short-term solution to give the industry time to address its weaknesses.

The Future

The International Monetary Fund (IMF) estimates that Africa's growth is edging towards six percent, the highest in 30 years, due to the boom of Chinese investment. Total trade between Africa and China should exceed $50 billion this year and could reach $100 billion by 2010, according to the IMF.

On one hand I think it can be very beneficial to Africa - the demand that China is creating for natural resources and products that Africa has, said Walter Kansteiner III, former US assistant secretary of state for African Affairs, according to IRIN news.

It lifts prices, brings volume up and increases opportunities for increased capital flow and employment opportunities for Africa, he added.

He indicated that apart from economic matters, a concurrent emphasis should be placed on environmental and human rights issues.