Centuries of Europa's involvement in Africa has resulted in strained relationships at best. China has been appearing as a new economic force in Africa, replacing the former colonial powers. While the jury is still out on the effects of China's involvement in Africa, and some of the incidents between all-to-eager Chinese companies looking for resources and African stakeholders have sometimes turned nasty, African countries turn to China because it seems to offer better deal than former colonizers.
In Congo a journalist at a Belgium monthly MO disclosed how the deal making takes place and under what conditions Chinese companies offer their support to the African country. Very often Chinese companies seem to operate on themselves abroad, without involvement and direction from the central government. But in the case of Congo, the so-called China Eximbank was instrumental for the deal between the Chinese companies and the government in Congo. The size of in total three deals amounts to 13 billion US dollar and was closed in Beijing at the end of December after two months of negotiations.
Congola's president Kabila praises the different Chinese approach: "For the first time in its history the Congolese people will feel what its copper, cobalt and nickel are meant for."
A new joint venture, called Socomin, is going to run new mines in Congo and will have to produce in fifteen years ten million tons of copper and cobalt to repay the investments. Three billion US dollar is meant for the mining project and an additional nine billion US dollar for the infrastructure. On the Chinese side, apart from the China Eximbank, Sinohydro and the China Railway Engineering Company (CREC) are the bigger players.
What makes the deal interesting is that it consists of specific "anti-colonial" measures. Only one in five employees can be Chinese and half a percent of each project has to be spend on education of the Congolese and technology transfer. One percent should be spend on social activities in the region and three percent is set apart to cover possible environmental effects. The deal is guaranteed by Congo's mineral resources and the country does not have to cough up the capital itself, a deal that is pretty uncommon for exploiting natural resources apart from oil.
Such deals, including the fast construction of railways, hospitals and schools seem very hard to beat for Western companies. Especially the way the China Eximbank is coordinating the combination of deals seem a way Western companies and countries could learn from.
Fons Tuinstra
Update:
A translation nto English of the article by John van Daele is available here
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