Dr. Martyn Davies of Frontier Advisory, a leading research capital advisory firm that specializes in emerging markets said there is a growing dependency factor for African economies on China’s fixed asset investment spending, which will only increase for mineral exporting countries.
“China’s focus is on oil and solid minerals, with agribusiness to grow in importance in the short term,” he told a business meeting recently.
He said in the medium term, African countries that align their development needs to China’s strategic interest will succeed, while others will falter, adding that China is important to Africa in many ways. China is the single largest investor in Africa and is also the single largest financier for Africa.
“If people don’t think China is important to Africa, they are probably aliens,” opined Davies.
Davies further told the meeting that Western countries had been accusing China of currency fixing and unfair trade, but he explained that in the last three decades countries that developed rapidly such as Indonesia and Singapore did so through a well-monitored monetary policy.
According to him, the Chinese currency has been appreciating rapidly in the last five years, while China remains competitive.
“The Westerners call China neo-colonialist, I call China the new capitalist,” he said.
He said China has established the world’s largest manufacturing platform, hence China is moving from being the leading producer to the leading investor and leading consumer.
He said if Walmart were a country, it would be China’s fifth largest market. His presentation showed that China is the only country that invests in African manufacturing, having set up manufacturing plants in countries like Ghana, Angola and the DRC.