【China-Africa Expo】CAETE professional forums: investment dialogue, private enterprises and developmental finance
On June 26, the 2nd China-Africa Development Finance Forum & CAIBA Senior Officials’ Meeting took place as a professional forum under CAETE. The other two professional forums, namely the Dialogue on Investing in Ethiopia, Kenya, Mozambique and Zambia and the 2019 China-Africa Private Sector Cooperation Forum, were both held on June 28.
Promoting financial cooperation
The 2nd China-Africa Development Finance Forum & CAIBA Senior Officials’ Meeting was held following the first forum and the founding conference of CAIBA on September 5, 2018. CAIBA (China-Africa Inter-Bank Association) was initiated by the China Development Bank (CDB), and its members include 16 regionally representative and influential African financial institutions such as the ABSA Group, Attijariwafa Bank, Commercial and Investment Bank of Mozambique, Banque Misr, Development Bank of the Central African States, Development Bank of Ethiopia, Ecobank, Equity Bank Kenya, First Bank of Nigeria, among others. Over 50 delegates from 15 of the African financial institutions participated in this CAETE forum.
The participating institutions discussed possible measures for finance to support China-Africa economic and trade cooperation and potential mechanisms. The participants reached agreements to heighten information sharing and personnel exchanges, strengthen partnerships and collaboration in project development, and build financing and investment mechanisms suited to the actual needs of China and Africa. Currently, the CDB has already been carrying out operations in partnerships with 10 member banks of CAIBA and has issued loans worth of 1.8 billion dollars to 16 projects involving infrastructure and SMEs.
Currently, Chinese private enterprises investing in Africa are often faced with difficulties when obtaining financing, a problem that curbs business development. One of the major obstacles for them to take loans from Chinese banks is that their assets overseas cannot become collaterals. An eventual solution of this problem may need to rely on the continuing intensification of financial cooperation between Chinese and African institutions.
Channelling investment information
In the Dialogue on Investing in Ethiopia, Kenya, Mozambique and Zambia, an investment promotion platform in Chinese was launched. Allowing access through mobile phones and social media apps such as WeChat, investors can from now on get information instantly on investment environment, regulations on firm registration, land and real estate price trends, taxes and trade regulations and so on. The platform also assists potential investors in establishing connections with the local communities, informing them on how to employ local talents, purchase local inputs and find services such as restaurants, sports, leisure and medical services. Since another frequently brought-up obstacle to investment in Africa by the Chinese business community is access to information, such platform, if well developed, has great potential of shrinking the information gap and facilitating investment decision-making.
The forum itself also served as a great occasion of information sharing, as officials charged with investment promotion from Ethiopia, Kenya, Mozambique and Zambia introduced promising area of investment, and representatives from enterprises as well as from African and international institutions also shared their experiences and advice for investing in Africa. If online platforms for investment promotion can be applied in a more general fashion, such information can be expected to reach a much broader audience and create significantly more value.
Supporting the private sector
The 2019 China-Africa Private Sector Cooperation Forum was assisted by the CABC, with a specific focus to facilitate China-Africa cooperation in manufacturing. After thematic speeches by officials from China and Africa, representatives from Chinese private enterprises and African governments engaged in exchanges about manufacturing cooperation. Officials from Senegal, Kenya and Benin stressed their efforts to improve business environment for potential investors, and Chinese private sector representatives presented their experience of investing in Africa.
The forum also saw the signing of 11 cooperation projects.
Ruoyu Chen, NYU Business and Political Economy
China-Africa Stories Contributor
Written from sources: