CHINA IN AFRICA: DEVELOPING TIES !

Friend or foe?
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In the first of a series on China's new relationship with Africa, the BBC's Adam Blenford looks at how their economic interests coincide. The next piece looks at the Chinese firms rebuilding the Ethiopian capital, Addis Ababa. In almost every corner of Africa there is something that interests China. The continent is rich in natural resources that promise to keep China's booming, fuel-hungry economy on the road. There is copper to mine in Zambia, iron ore to extract in Gabon and oil to refine in Angola. In other countries less blessed by natural resources, Chinese companies have spied trading and investment opportunities.

See a map of China's investment in Africa

Africa's need for new and better roads, school buildings, computer networks, telecoms systems and power generation has opened a lucrative window of opportunity for Chinese firms. The new Sino-African dynamic can leave the West ill at ease, reviving memories of Europe's colonial domination in Africa and drawing complaints that low Chinese bids are freezing out Western companies.
China also offers "no-strings" aid, a marked contrast to Western donors who impose conditions on aid and tie trade sweeteners to human rights issues. Critics say China's approach has emboldened unsavoury governments, allowing them to ignore Western calls for reform, safe in the knowledge that Beijing will take up the slack. Sudan, with its vast oil reserves, is the number one recipient of Chinese investment, and sells some two-thirds of its oil to Beijing. As a result, China has been criticised for its links with a government ostracised by many for its role in the ongoing crisis in Darfur.
Elsewhere, stories of anti-Chinese unrest in Zambia and the killing of nine Chinese oil workers by rebels in Ethiopia's Ogaden region have focused Beijing's attention on the price it might have to pay for its African adventure. The Chinese insist they are not interested in dominating Africa.
Instead China says it seeks a "harmonious world", an evolution of its Cold War search for "peaceful co-existence", and it wants to coax African countries along the path towards development.

Instead of top-down aid projects, Chinese companies seek profits in Africa as they bequeath the continent a new infrastructure - one that will more than likely to be used to increase trade with China. "China consistently respects and supports African countries," Yan Xiao Gang, China's economic attache in Ethiopia, told the BBC. "It never imposes its own will on African countries, nor interferes in the domestic affairs of African countries." Ethiopian officials speak of "owning" their country's development, but do admit that major contracts usually go to Chinese firms because of their ability to keep costs down.

Many Chinese firms use large numbers of local workers but wages remain low. However, there is evidence that workers are learning new skills because of the availability of Chinese-funded work. Taking advantage of low labour costs, the Chinese are also building factories across Africa.
Observers say Beijing appears ready for the long haul in Africa. "For China to become a major power it needs to continue its double-digit economic growth of recent years. For this it needs energy and markets," Prof M Venkataraman, of the University of Addis Ababa, told the BBC. Those markets are proving receptive, and trade with the continent is famously booming - up to $40bn in 2004, a tenfold increase in under a decade.

Yet most African countries now have a growing trade deficit with China, in spite of favourable tax-free trading agreements. Ethiopian exports to China reached $132m (£63m) in 2006, a figure dwarfed by the value of Chinese imports of $432m (£206m). "It is not clear what the long-term effect of the Chinese projects will be," said Mr Venkataraman. "But the facts are very clear - there are going to be benefits to both sides. China is going to remain in this continent for a very long time." The China-Africa relationship shot to attention in November 2006 when 48 African heads of government attended a forum in Beijing. China's capital was festooned with images of exotic Africa for the occasion. Speeches were made and deals were struck.

See China's $150m gift to the African Union
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Tsegab Kebebew, a senior official in Ethiopia's foreign ministry, was in Beijing for the meeting. One year on, he remains enthused about the relationship. "This is a new strategic partnership. There is no colonial history between Africa and China, so they are well received here," he told the BBC. "There is no psychological bias against the Chinese." In fact China has a history of involvement in Africa, and undertook major aid project in the 1960s and 1970s. Among Beijing's gifts was a railroad linking Zambia and Tanzania, now scheduled to be rebuilt by a Chinese company.

China's gifts to modern-day Africa will soon include a gleaming new conference centre at the headquarters of the African Union in Addis Ababa - a symbol of Beijing's commitment to African development, says Mr Yan of the Chinese embassy. There is symbolism in the shops, too. With Ethiopia only now marking the turn of its millennium, seven years after the rest of the world, the country is in the grip of a 12-month millennium frenzy. Banners adorn public buildings and souvenirs are on sale in many shops. The government hopes the outbreak of national pride can spur Ethiopia to a new age of prosperity. Those browsing a local market for, say, a souvenir plate bearing the legend "Ethiopian Millennium 2000" would do well to turn the gift over and look underneath.

Embossed on the white plastic is a phrase already familiar to all in the West: "Made in China".
BBC NEWS REPORT.