The thematic seminar under CAETE focusing on trade opened on June 27, 2019. It attracted delegations from more than 10 African countries including Angola, Uganda and Cameroon, government officials from China and Africa, officials from international organizations such as WTO and ITC, and representatives from financial institutions, business associations and enterprises in China and Africa. Participants engaged in intellectually enriching discussions on measures to improve both the scale and the quality of China-Africa trade.
A Quest for High-Quality Trade
China-Africa trade volume has seen substantial growth since the 2000s. Even after a slump in 2016, trade volume quickly returned to its rapid growth track and reached 204.19 billion dollars in 2018. However, due to differences in economic endowment of China and Africa, their bilateral trade can hardly be qualified as well-balanced: a large bulk of Chinese exports to Africa were consisted of manufactured goods such as machinery, automobiles and electronics, whereas African exports to China were predominantly raw materials and primarily processed goods, whose production does not result in much value added. (For more information on the current status of China-Africa trade, please refer to our article 【Analysis】China-Africa Trade: An aerial view)
It is therefore in the interest of all African countries to both increase the quantity of exports to China and augment the share of processed and manufactured products. Discussions throughout the seminar revolved around this question, exploring means for selling more African products to the Chinese market, strategies to increase efficiency of commodity circulation within African countries to develop domestic markets, ways to reduce costs of importing from China, and the potential of a digitalized China-Africa economic and trade platform.
From vision to policy
Zhou Yue, deputy director-general of the Department of Commerce of Hunan, made a number of pledges for concrete measures to promote China-Africa, especially Hunan-Africa trade. On the behalf of Hunan province, he warmly welcomed African countries and major business associations to set up economic and trade offices, promising to provide “one-stop” services and policy support. He also placed emphasis on the continuing presence of the exhibition hall for African commodities at Gaoqiao as well as the online China-Africa Economic and Trade Expo. He stated that future trade would be supported by direct flights between Hunan and Africa, together with financing mechanisms including credit and blanket insurance.
As the financial service strategic partner of CAETE, the Industrial and Commercial Bank of China developed products that cater the financing and transaction demand of China-Africa trade. The bank designed an integrated product for payment and fund monitoring tailored for the digitalized trade platform envisioned by the Hunan government, and will also promote direct financial linkage between China and Africa and Renminbi cross-border settlement.
Ruoyu Chen, NYU Business and Political Economy
China-Africa Stories Contributor
Written from sources: