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President Xi announces US$60bn financing to Africa

September 4, 2018

By Joseph S. Margai in Beijing

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President Xi Jinping announced the massive financing package yesterday

Chinese President Xi Jinping Monday, 3rd September, announced a whopping sum of 60 billion United States Dollars (US$60bn) financing to African countries for the next three years.

President Xi, who was speaking at the opening ceremony of the Forum on China-Africa Cooperation (FOCAC), hosted at the Great Hall of the People in Beijing, said the US$60bn would be in the form of government assistance as well as investment by financing financial institutions and companies.

“This will include US$15 billion of grant, interest-free loans and concessional loans. US$20 billion of credit lines, the setting up of a US$10 billion special fund for development financing and a US$5 billion special fund for financing imports from Africa,” he announced.

He told the gathering African leaders that Beijing would encourage Chinese companies to invest at least US$10billion in Africa in the next three years.

“In addition for those of Africa’s least-developed countries, heavily indebted and poor countries, including small island countries that have diplomatic relations with China, the debt they have incurred in a form of interest-free Chinese government loans, which is due to mature by the end of 2018, will be exempted,” he also announced.

President Xi said the future of China-Africa relationship lies in young people, adding that many of the measures in the aid initiative were designed to help young people in Africa.

“These measures will provide the young Africans training and job opportunities and open up more space for their development. I am confident that the baton of China-Africa friendship will be passed from one generation to the next,” he said.

The Chinese president noted that anyone who keeps himself in isolation in a single island would not have a future.

He recalled that in the last FOCAC summit held in Johannesburg, South Africa, in 2015, he announced 10 cooperation plans with Africa, noting that those plans have either been implemented or arranged to be implemented.

Announcing the 2018 Beijing FOCAC summit’s initiatives in collaboration with the previous 10 cooperation plans, President Xi revealed that in the next three years and beyond, those initiatives would have been implemented.

“Firstly, China will launch an industrial promotion initiative. Under this initiative, we are encouraging Chinese investment to open in Africa. We will build and upgrade a number of trade and economic zones in Africa. We will support Africa to achieve general food security by 2030. We will implement 50 agricultural assistance programs,” he said, adding that China will provide one billion Chinese Yuan, approximately US$146 million, of emergency humanitarian food assistance to African countries affected by natural disaster.

Secondly, he said, China would launch an infrastructure connectivity initiative, adding that they have agreed to jointly formulate the China-Africa Infrastructure and Cooperation Plan with the African Union.

He said the third one is that China would launch the trade facilitation initiative, noting that they have decided to increase import, particularly non-resource products from Africa.

“The fourth one is that China will launch a green development initiative. Under this one, we have decided to undertake 50 projects for green development and ecological and environmental protection in Africa, desertification prevention and control and wildlife protection,” he said.

President Xi said the fifth initiative would entail capacity building, which would focus on establishing a China-Africa innovation cooperation centre, promote youth innovation and entrepreneurship.

“A tailor-made program would be carried out to train 1,000 high calibre of Africans. 50,000 Chinese government scholarships will be provided for Africans, including 50,000 training opportunities for seminars and workshops. 2,000 young Africans will have to visit China,” he said.

Sixthly, he said, China would launch a health care initiative, noting that they have decided to upgrade 50 medical and health aid programmes on the continent.

The seventh one, according to him, is the people-to-people exchange initiative, wherein more African cultural centres would be opened in China and Africa.

Finally, he said, China would launch a peace and security initiative, including a China-Africa peace and security fund to boost peace, security, peacekeeping and law and order.

Cyril Ramaphosa, President of South Africa, thanked the Chinese government and people for hosting African leaders and their delegations in China.

“We want an Africa that is defined by good governance, justice, security and the rule of law. We also want to see an Africa whose development is people centred. And that’s why we embrace the belt and road initiative (BRI) put forward by President Xi since he took over power, that will reduce cost of transport and subsequently increase trade between Africa and China,” he said.

He said the continent welcomes the announcement made by President Xi to provide US$60 billion financing for Africa, adding that there were many valuable lessons that Africa could learn from the Chinese development path.

“The Chinese import raw materials from Africa and they export finished products to Africa. We need to get the knowledge that they use to process those raw materials in order to be able to process them for ourselves,” he remarked.