On September 4, the First Bank of Nigeria (FBN), the oldest commercial bank in Nigeria, signed a strategic cooperation agreement with the China-Africa Industrial Forum at the Sixth Africa Theme Day Forum held during the 2021 China International Fair for Trade in Services (CIFTIS).

"We cooperate with many Chinese companies in the fields of infrastructure and trade in goods. Following this agreement, our projects will focus more on trade in services, especially in the field of education and health," Wang Chuanqiang, chief representative of the FBN's Beijing office, told ChinAfrica.

Since its establishment in China in 2009, the FBN's Beijing representative office, which provides financial services to Chinese companies investing in Africa, has witnessed different types of Chinese companies coming together with Africa. At first, its clients were trading companies, selling products on the African continent only. Then came companies wanting to invest in Africa by setting up local factories or production lines.

In recent years, in addition to infrastructure companies, the new trend is trade in services. At the 2021 CIFTIS, which was held in Beijing from September 2 to 7, exhibitors from 12 African countries presented 100 cooperation projects in various fields, including aviation services, health cooperation, agricultural development, e-commerce, and tourism development.

"China-Africa trade in services cooperation has great potential to evolve," Wang said.

New growth engine

The COVID-19 pandemic has encountered enormous difficulties. The pandemic has inevitably affected trade in goods, but it has brought unprecedented opportunities to new sectors, such as the digital economy, the IT economy, mobile payment, online exhibitions, telemedicine and online education. Trade in services has become a new engine of global economic growth.

"New growth points of China-Africa economic and trade cooperation are emerging in this new configuration. Cooperation in services trade has really taken off, with remarkable results," said Xu Jinghu, Special Representative of the Chinese Government on African Affairs, at the forum.

In the last decade, Chinese banks, including Bank of China, Industrial and Commercial Bank of China, etc., have opened branches in Africa to offer financial services. The Chinese company StarTimes has provided access to digital television with a wide range of content to the rural population of 37 African countries. Hainan Airlines Group, in collaboration with the China-Africa Development Fund, has established Africa World Airlines in Ghana to provide transportation services to the local population.

Trade in services is crucial for Africa's economic development, said Zhang Guoqing, a former commissioner of the Ministry of Commerce in Shanghai. "Africa is in a period of economic transformation and urbanization. African countries need to adjust the distribution of economic activities. The development of the services sector and trade in services will contribute to job creation and trade diversification," he said.

According to Xu, China's services imports from Africa have grown by an annual average of 20 percent since 2017, creating nearly 400,000 jobs for Africa each year.

Strong demand

The international trade of African countries is mainly in raw materials or finished goods. This has made Africa a huge supplier of raw materials that has served global industrialization for over 30 years. "Africa is not only characterized by an abundance of natural resources. It is a continent that needs modern services and local talent," said Awale Ali Kullane, Somalia's Ambassador to China.

In his view, in the current health context, the development of trade in services should be considered a priority in Africa. "Chinese companies have gained rich experience and mature technology in the development and use of technology. Therefore, Somalia hopes to use services trade via technology transfer, financial services, etc., to follow China in establishing a new clean energy system to solve the electricity shortage and technical and financial bottlenecks."

Another area of great importance in the current context is health care. "The pandemic has highlighted many medical gaps and the urgent need for specialized facilities and human resources," said Emmanuel Pheko, Botswana's counselor in China.

All the problems mentioned actually create new opportunities. With the implementation of the African Continental Free Trade Area, Africa will become more open in areas such as infrastructure, tourism, banking and insurance. "The growth of the services sector in Africa will lead to the expansion of many African economies. The economic activity was based on the agricultural sector only, which posed problems for African economies. This situation will finally change step by step," said Cheng Zhigang, Secretary General of the China-Africa Industrial Forum, which was established in 2008 to promote China-Africa development and cooperation.

For their part, Chinese companies will also be able to offer their expertise. Jiangxi Yeli Medical Instrument Co. Ltd. is a small and medium-size enterprise based in Nanchang, capital of central China's Jiangxi Province, which focuses on vitro diagnostic reagents, in particular microbiological and parasite diagnostics. "As health care is a key business sector for African countries, our company should be able to benefit from future opportunities in Africa," said Lu Zhenghe, the company's general manager.

(Printed Edition Title: Sight on Services)

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