Africa's untapped marine resources can benefit from Chinese fishery expertise

A year after finding a job in a construction company in central China's Henan Province, Wang Liang was transferred to a coastal village in Ghana. Expecting to be impressed by the African country's natural attractions, Wang, an enthusiastic foodie, was actually overwhelmed by the abundance of local seafood.

"It is unimaginable! There are prawns and crabs everywhere. You can tuck into a wide variety of succulent seafood with less than $10," the 25-year-old told ChinAfrica.

In sharp contrast, he found that despite the rich fishery resources, local Ghanaians lead a simple life as these resources do not generate sufficient financial returns to raise the standard of living.

The Ghana experience reflects the plight of many other African coastal countries. But now, there is a change in the air - or to be precise, in the water. Chinese and African businesses are cooperating to explore the continent's marine resources.

Ancient history records the existence of the legendary Silk Road, a conduit for trade and cultural exchanges between China's southeastern coastal areas and foreign countries. Now the road, dating back to the Qin Dynasty (221-206 B.C.), is going to be reinvented as a strategic 21st-century Maritime Silk Road.

Way to transformation

Since Chinese President Xi Jinping proposed the construction of the 21st-century Maritime Silk Road during his visit to Indonesia in October 2013, businesses in Chinese provinces along the route have been eager to pursue the entrepreneurial opportunities.

"China-Africa fishery cooperation can be an important theme in building the Maritime Silk Road, bringing the two sides closer," said Chen Yonggui, Executive Chairman of China-Africa Fishery Union. To date, 29 African countries have signed agreements with China to tap into the fishery sector.

The cooperation will be mutually beneficial as it can utilize both China's expertise and Africa's rich fishery resources. "Africa has a vast water area of 650,000 square km with an annual catch amounting to 5 million tons," Chen said. "It is one of the continents with the greatest potential to develop the fishery sector."

The well-established harbors in Africa provide another advantage to develop the sector. "The Mombasa Port is the largest port in Kenya, and one of the largest in East Africa. It connects neighboring inland areas with coastal trade centers and then all the way to China, and even Europe," Phyllis Kandie, Kenya's Cabinet Secretary for East African Affairs, Commerce and Tourism, told ChinAfrica at the China International Fair for Investment and Trade (CIFIT) in Xiamen, southeast China's Fujian Province, in September this year. Kandie was on hand at the CIFIT to invite Chinese investors to help build big ships and modern fishing facilities.  

Due to a lack of large vessels, most African fishermen are restricted to low-efficiency catches in offshore areas, missing out on the rich resources that lay further out at sea. This is verified by statistics from the Common Market for Eastern and Southern Africa. The secretariat of the organization said only 40 percent of the fishery resources in this region was effectively utilized.

According to Chen, with the modernization of fishing methods, popularity of aquaculture and improvement in processing and storing aquatic products - all areas where China can share its experience - fishing efficiency can be greatly improved.

The Maritime Silk Road will serve as a bridge for both sides to exchange relevant experience, goods, capital and expertise. "The future of the Maritime Silk Road is promising. We can use the opportunity presented by China to better develop ourselves," said Kandie.  

Cause for cheer

Chinese businesses see the cooperation as a long-term venture, starting from the building of a domestic marine fishery cooperation base. "A modern marine industrial base is in the pipeline on Langqi Island in Fujian Province," said Chen. The island is the fourth largest in Fujian, with a land area of 92 square km.

"The base will not simply connect countries along the Maritime Silk Road," Chen added. "It will be a complex of a cold chain logistics center, a fishery products processing plant and trading center, a marine biology research base, as well as a leisure resort."

Such a gigantic trans-border business plan covering the entire industrial chain cannot be realized without ongoing large-scale financial support. The good news is that the private sector has stepped in to support the cooperation. It was announced at the CIFIT this year that a China-Africa Maritime Silk Road Investment Co. and a Maritime Silk Road Investment Fund Management Center were established.

Huang Jianhui, Manager of the fund center, said registered capital of the company was 500 million yuan ($81.5 million). It planned to raise over 100 billion yuan ($16.3 billion) to support related projects along the route in African countries.

"Based at Langqi, the fund will serve as a capital pool. It aims to establish an economic belt to revitalize the ancient trading corridor of silk and tea. It will be a modern passageway for trade and cultural exchanges between China and African countries," said Huang. 

Adding value

For Chinese investors, the prospect of investing in the sector in Africa is clouded by policies restricting foreign businesses. They include restricting remittances that can be made back to China, curbing the landing of Chinese crews, and limiting rights to sell catches to local companies.

Reasons for the restrictions are concerns over environmental issues, for example, problems caused by overfishing and abuse of resources. "The cooperation should be in a win-win approach," Huang said. "Chinese businesses should help locals develop their marine economy through technology transfers and highlight the importance of protecting the local environment."

As a businessman, he has realized the responsibility of a Chinese company operating abroad. "We are not coming for overnight profits but for sustainable business. The businesses we support will focus on generating employment and improving local people's livelihoods," he said.

"For many underdeveloped African nations, fishery is a good resource that can be used to alleviate poverty," said Chen Yonggui of the China-Africa Fishery Union. Besides helping build refrigeration plants and shipyards, he said Chinese businesses could introduce processing techniques to add value to fishery products.

"Processing raw fish will be a promising business as it will improve the added value of natural resources," said Mike Liu, a Chinese buyer of sea cucumber in Senegal. During the past 10 years in the West African country, he has witnessed the low efficiency of the traditional processing method and the ensuing slender profit margin. So he is considering bringing in processing techniques from China and cooperating with local businesses to set up plants to process sea cucumbers into health foods or popular biscuits. This would shed some light on how to carry out Huang's vision of establishing long-term, sustainable and equitable businesses on the continent.