China announces $60 billion ‘funding support’ for Africa

Johannesburg, December 4

Chinese President Xi Jinping announced $60 billion of assistance and loans for Africa at a summit in Johannesburg today, signalling China’s commitment to the continent despite a recent fall in investment.

China’s economic growth has taken a dip this year, triggering a global commodities slump and causing Beijing to slash investment in Africa by more than 40 per cent in the first six months of 2015.

Xi said that China has decided ‘to provide a total of $60 billion of funding support that includes $5 billion of grants in zero interest loans (and) $35 billion in preferential facility and export credit loans and concessional loans’.

In a slew of pledges at his speech opening the Forum on China-Africa Cooperation (FOCAC), he also announced drought aid for the continent.

“China is greatly concerned about the poor harvest caused by El Nino in many African countries and will provide one billion renminbi or yuan ($156 million) worth of emergency food aid to the affected countries,” he said.

The two-day FOCAC meeting is the second time China has brought together African leaders since the forum was launched in Beijing in 2000.

Since then, China’s trade with Africa has overtaken that of the traditional partners, Europe and the United States.

A fall in mineral prices has hit African countries who relied on Chinese demand, with large lay-offs by mining companies in resource-rich countries such as Zambia and South Africa.

“We are keen to explore cooperation with China to ensure the long-term viability of African mining,” South Africa President Jacob Zuma told the summit. “This is important in light of the declining demand for commodities.”

Xi — accompanied by his wife Peng Liyuan — landed in South Africa after a brief visit to Zimbabwe, where Chinese projects have helped prop up an economy plunged into crisis under President Robert Mugabe’s rule.

Mugabe, who addressed the summit’s opening session as chair of African Union, lavished praise on the Chinese leader.

“We say he is a god-sent person,” Mugabe said. “President Xi Jinping has made a much anticipated announcement of new measures ... to inject vibrancy into that already dynamic relationship between China and Africa.”