Sunday, July 25, 2010

Back to old issues: China and Africa

For China watchers, there was an interesting letter in London Review of Books vol 32 No 12 from Hugh Miles in response to an article by Adam Shatz about the decline of Egypt under Hosni Mubarak.  The letter writer points out that while Shatz focuses on the relationship between Egypt and the US and Israel, another relationship has been developing:  the influence of China.

Here is the letter in full:
"Seventeen thousand Chinese are now officially resident in Egypt and the volume of trade between the two countries has gone from $635 million in 1999 to more than $5.86 billion in 2009. Besides granite and marble, China imports Egyptian cotton, oil, carpets and kitchen sinks. English is the main language of business, but around the Free Trade Zones, cheap manufacturing bases close to European markets with very few export restrictions, most of the road signs are in Chinese. According to Egypt’s General Authority for Investment, there are 1038 Chinese companies operating in Egypt, representing a total investment of $311 million.
‘Before the Chinese arrived everyone was leaving this neighbourhood,’ I was told recently by an estate agent in the Cairo suburb of New Maadi. ‘Nowadays you see more Chinese round here than Egyptians. They’re here for this.’ He tapped the granite counter. ‘After the first wave came all kinds of small businesses to service the community, like gyms, restaurants and shops. Then a second wave came to work for Huawei when it replaced Siemens and Alcatel as Etisalat’s main contractor in Egypt.’ Huawei Technologies is the second largest telecoms company in the world. Last November Wen Jiabao opened its $20 million new training centre in Cairo’s Smart Village. ‘We have a business relationship,’ the estate agent said. ‘They don’t care for football or religion. All they think about is business, except when they are drinking tea and playing cards. But there are no problems and we say hello to one another when we pass each other in the street.’
The Chinese Embassy has gone on a charm offensive of film festivals, photo exhibitions and, last February in Rihab City on Cairo’s eastern outskirts, a cultural week showcasing martial arts, Chinese music and tea art. Two Confucius institutes have been established and last year China Central Television launched a new Arabic-language satellite TV channel.
The love-in appears to be reciprocal. From 1999 to 2009 Egypt’s exports to China grew from $15 million to $989 million, creating thousands of new jobs. In the last six years, five Egyptian universities have opened Chinese departments and Chinese goods are a familiar part of everyday life. A new character has made an appearance in Egyptian soap operas: the Arabic-speaking Chinese saleswoman going from door to door, offering cheap consumer goods, bootleg DVDs and snappy haircuts. Egyptians joke about the quality of the imports and grumble that the Chinese never spend any money. Their fathers used to grumble about the Soviets for the same reason.
China’s relationship with the Arabs dates back to the Silk Road, but modern relations can be traced to 30 May 1956 when Nasser defied the US policy of containment to become the first Arab or African country to establish diplomatic ties with the Communist state. (Later that year Chinese newspapers celebrated the nationalisation of the Suez Canal.) Mubarak himself has been to China at least seven times. In 1999 he signed a key strategic agreement in Beijing and since then co-operation has deepened to include infrastructure building, training, energy and defence. There are goodwill politburo visits every few months and at the start of May Egypt’s Oil Ministry signed a memorandum of understanding with China National Petroleum Corp to build Egypt’s biggest ever oil refinery in a contract worth $2 billion. ‘Things are going perfectly,’ according to Zhijie Zeng, the director of the China Development Bank. ‘We are eager to deepen the co-operation. Africa and China have a win-win relationship.’
But the press has spoken of China’s ‘commercial attack’ on Egypt, and there have been accusations of Chinese products being dumped in Egypt at below cost price. In January a Chinese ship accidentally destroyed coral reefs in South Sinai. And in the second half of last year China abruptly halted trade shipments to Egypt. The official reason was to combat smuggling but the move sent the price of some commodities shooting up 40 per cent."
Hugh Miles

Just makes one think.....

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