The Invest in Africa Forum that aimed at strengthening the investment relationship between Africa and China was held on Tuesday July 1, 2015 at the Sheraton Addis Hotel.
The two-day event was officially opened by Prime Minister Hailemariam Desalegn, who stated that the platform was a great opportunity to converse with different partners and build on past successes.
“My government sees this forum as embodying three important themes: Ethiopia’s and Africa’s commitment to economic transformation, the strong partnership between Africa and China and the power of industrialization to deliver development results,” Hailemariam said in his opening statement.
The Forum underlined that increased investment and industrialization would help unlock the potential for sustainable and inclusive growth, job creation and poverty reduction in African countries. Discussions also focused on accelerated and responsible local and foreign investment in Africa.
“China and Africa have a long history of partnership. This partnership has expanded rapidly and taken on a new momentum. Across Africa, we have seen many examples of how this partnership can have a mutually beneficial result. Trade with China has been one of the key drivers of economic growth in Africa. As China-Africa trade cooperation moves into its next phase, there will be significant potential for our export, particularly in agriculture and manufacturing,” Hailemariam noted.
The Prime Minister further said that Chinese investment can be instrumental in addressing structural and logistical constraints that impact the competitiveness of African exports.
“Chinese Foreign Direct Investment now extends across the continent. It is estimated that Chinese FDI in Africa over the past decade has come close to five percent of the global FDI. We also note that Chinese FDI is present in a broad range of African countries including non resource-rich countries in East Africa such as Ethiopia,” Hailemariam said.
Chinese banks have supported large scale infrastructure investment in Africa. Ethiopia has emerged as an especially significant partner in that regard, and has also established itself as one of China’s top trading partners.
Hailemariam stated that Chinese investments in infrastructure, particularly in the energy and transportation sectors, have helped bring in new skill and technology and address the constraints faced by many African countries. He further stated that if the right kind of partnership is built, the continent will benefit remarkably.
“The Ethiopian government sees industrialization as critical to diversifying and delivering the transformation that we all seek across the African continent. That is why we welcome this forum as the beginning of a conversation – a conversation with many different partners on how we can take past successes to the next level in the future,” he said.
China has been Africa’s largest trading partner for six consecutive years, with trade in 2014 reaching USD 222 billion. Just last year, the Chinese invested a record USD four billion in Africa, which is up 14 percent from 2013.
Among other topics discussed at the Forum was the critical role industrial parks and economic zones are expected to play in the process of industrialization. Since 2007, the Chinese government has been supporting six Chinese company-initiated industrial zones in Africa, located in Egypt, Zambia, Nigeria, Ethiopia, and Mauritius.
With a population of 1.1 billion and low labor costs, Africa is said to be an ideal place to relocate the light manufacturing sector of China as global value chain trends shift.
The Invest in Africa Forum was attended by around 200 people including ministers and governors from China and African countries, high ranking representatives of regional economic and multilateral organizations, private firms and other development partners.