When Wang Xiaoyong looks back at the success of the China-Africa Business Council, he feels justifiably proud. As the council’s secretary general, he has watched as fledgling startups have gone on to blossom into companies providing much needed jobs and economic injections into Africa’s business sector.
Prime examples are Chinese shoemaker Huajian Group in Ethiopia, and agriculture powerhouse China-Africa Cotton Development Co., Ltd., both supremely successful businesses that have benefited from the council’s bridging assistance.
The longer he works in connecting Chinese businesses to African counterparts, the clearer one fact becomes: the successful businesses all have something in common, which are credibility, social responsibility, strategic planning, and dedication to a specific area. Companies with these qualities are what the China-Africa Business Council wants to bring to Africa.
"Good businesses make in-depth research on local market needs and the development vision of targeted African countries. Based on this and their former accumulated experiences in specific area of trade, they roll out a long-term operation strategy," Wang told ChinAfrica.
The China-Africa Business Council originated from a proposal by Kofi Annan, then Secretary General of the United Nations, in 2004. Annan suggested China set up a non-governmental organization (NGO) to scale up poverty alleviation and development efforts in Africa under the South-South cooperation mechanism. After more than a years’ preparation, the China Society for Promotion of the Guangcai Program, targeting the anti-poverty efforts, the China International Center for Economic and Technical Exchanges under the Ministry of Commerce, and the United Nations Development Programme jointly made the proposal a reality in October 2006.
Over the past 11 years, the China-Africa Business Council has facilitated around 600 Chinese companies to expand their operations or invest in 51 African countries, with total investment exceeding $9 billion. In the process, more than 100,000 direct jobs and 1.5 million indirect jobs have been created in 38 African countries.
With more and more African countries actively cooperating with the Belt and Road Initiative and the implementation of China’s commitment to bolster industrialization in the continent under the Johannesburg Summit of Forum on China-Africa Cooperation (FOCAC), Chinese companies, especially those from the private sector, are increasing their investment in the continent.
These burgeoning businesses are shaping a new form of China-Africa economic ties featuring investment as the driver instead of being dominated by trade, according to a report on Chinese businesses in Africa released by McKinsey & Company in June this year. The report said bilateral trade between China and Africa increased at an annual growth rate of 20 percent, whereas China’s foreign direct investment in Africa climbed by 40 percent annually over the past decade. The figure could be 15 percent more if the non-official capital inflow were counted, said the report.
McKinsey & Company estimated that the number of Chinese businesses in Africa has exceeded 10,000, a four-fold increase to that previously anticipated. About 90 percent of them are private companies, one third of which are in the manufacturing sector.
"It is positive change for Africa and will bring opportunities for the continent to accelerate its industrialization process," said Wang. He explained that the situation was similar to that in the 1980s and 90s when China was opening up to foreign businesses so as to boost industries, especially those in the manufacturing sector.
"With advanced technology, management, and a global market willing to invest, China achieved an economic miracle. If China can do that, why cannot Africa," he said, adding that the key is how host countries use the foreign investments for their own development.
Keeping pace with the new condition of Sino-African economic ties driven by increasing investment, the China-Africa Business Council values Chinese companies with sufficient funding and a sense of sustainability, rather than those looking to make quick money, and hosts institutionalized forums and conferences to connect them with African opportunities. Responding to the demands of African countries, the selected businesses focus on infrastructure construction and maintenance, manufacturing, agriculture, service and financial sectors.
Charity begins at home
Besides being a facilitator, the China-Africa Business Council began to commit itself to charity work in Africa in recent years. In March 2015, it launched the Increasing Love for Decreasing AIDS Fund aimed at combatting the AIDS epidemic, specifically among African women and children. Donations raised by the fund are given to anti-AIDS programs initiated by UNAIDS in Africa.
According to figures on the fund’s website, a total of 3,242,761.01 yuan ($490,139) has been raised as of October 31, 2017, 50 percent of which is from students and youths and 30 percent from Chinese companies. Currently, the fund has given $230,000 to women and children affected by the disease in Africa.
"Ending the AIDS epidemic is one of the priorities of poverty alleviation and development efforts, which is also our original vision," said Wang, explaining why the council also devoted itself into charity.
In Wang’s eyes, charity is not just about donating money, but also a call for society as a whole to know and care about Africa and its people. Besides the donations, the fund involved 300,000 people in its anti-AIDS efforts in Africa.
During June to August, 2017, the fund invited youths across the world to participate in the first Public Benefit International Challenge for Youth 2017 and enhance the life of their African peers through innovation. The activity involved 40 teams representing more than 80 schools from home and abroad and 240,000 Internet users to vote for the best innovation. Besides raising money for a football pitch and six music classrooms, the participating teams programmed online courses and designed water purifiers for African children.
"It is amazing that these students are so creative and ready to know and care about African children of the same age. For African people, what they received is also beyond a donation. Such exchanges are important and touching," said Wang.