Services to shine in China's trade with Africa

Services to shine in China's trade with Africa

China-Africa trade in services has huge potential while the cooperation will gradually expand into finance, information, insurance and legal services, experts said.

"China is the world's largest developing country while Africa is the continent with the most developing countries. And the potential is huge for bilateral trade in services," Sun Zhenyu, head of the China Society for WTO Studies and former Chinese ambassador to the World Trade Organisation, said in a forum during the China International Fair for Trade in Services.

"Africa is speeding up the construction of infrastructure, developing agriculture and manufacturing as well as attracting technology and capital. It is becoming a hot destination for investment," Sun said.

Africa achieved steady economic growth in the past decade. Growth reached 4.8 per cent in 2012 and the continent has 6 out of the world's 10 economies with fastest growth and will maintain rapid growth in the next decade, Sun added.

China's exports and investment in Africa have maintained strong momentum in recent years. China has been Africa's largest trade partner since 2009 and bilateral trade was close to US$200 billion (S$251billion) in 2012, compared with US$10 billion in 2000.

China's investment in Africa increased by US$2 billion to US$3 billion annually in recent years. The direct investment in Africa registered $2.9 billion in 2012, and the stock, or the accumulated amount, reached US$20 billion by the end of 2012, according to Sun.

Meanwhile, African investment in China steadily expanded in the past years and has accumulated to US$12.9 billion by the end of 2011, mainly in petrochemical, mechanical and electronic, and communication sectors.

"China's economic cooperation with Africa, including investment, trade and aid, plays an irreplaceable role in Africa's social and economic development, as well as improvement of livelihood. China-Africa cooperation is the driver of Africa's growth rather than the claimed neocolonialism," Sun said.

Bheki Langa, ambassador of South Africa to China, said that African people welcome Chinese investment.

China-Africa cooperation is on an equal footing with mutual benefits and China helps Africa in resolving many problems left from the colonial period while the claim of China's neocolonialism is not grounded, he added.

China-Africa economic cooperation will not only speed up the development of Africa but also play an increasingly important role in world economic growth, Sun said.

"The cooperation has made great progress in aviation and tourism, and it will gradually expand into new fields including finance, information, insurance and legal services and benefit both sides."

Africa is now China's second-largest overseas market for project contracting.

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