China-Africa friendship has matured

Former politician looks forward to a new chapter in evolving relationship

Sino-African relations have flourished to a new level, according to Mohamed Higazy.

"China has proved itself a good trading and development partner. We have reached a level where uplifting the lives of our people is our key concern," says the former assistant foreign minister of Egypt.

Speaking in Cairo, the diplomat says Africa should play a key role in this cooperation by proposing and implementing innovative strategies that benefit its citizens, and it should have no doubt.

"China has launched forums where it is engaging us as peers. Africa is friends with the second-largest economy in the world, which is interested in working with it."

He observes that the kind of misunderstandings that have occurred with traditional partners have hardly been the case with China - hence the need for Africa to embrace the opportunity.

"China scarcely interferes with internal governance and is a firm believer that Africa is capable of solving its own issues," Higazy says. "We therefore need to put our houses in order and specify our development ambitions."

The career diplomat, who has served his country for more than 35 years, is candid in his assessment of the China-Africa relationship. As with other partners, he says China's engagement with the continent is based on trade. Nonetheless, its approach has nudged Africa's economy forward while giving its funds a human face.

"China understands Africa's critical needs, limited funds, skills and infrastructure. Over the years we have witnessed high-level engagement between President Xi Jinping and his counterparts in Africa. We have seen disbursements of funds and the arrival of Chinese firms that not only provide technical support but boost the capacity-building efforts of African governments. Modern infrastructure now dots our continent, something we never thought possible. I would say that this is win-win cooperation."

Higazy sternly cautions against adopting the popular rhetoric that criticizes China's growing influence in Africa. He believes the continent has matured and its leaders are smart.

"Africa knows its needs and wants a partner who engages with it sincerely - one that does not interfere with its sovereignty but understands its gaps and is willing to work above that. We have found this friend in China."

Old partners, nevertheless, cannot be done away with. He notes that Africa's challenges are vast and no one partner can shoulder the responsibility. China has been reliable in building hard infrastructure while the United States and European partners have shown an interest in propping up soft infrastructure such as water and health, in addition to developing institutional capacity.

"We have also seen India strengthening its presence in Africa and this is visible in the IT sector. New partners are also showing an interest - such as Turkey and Middle Eastern countries. This charm offensive means jobs for our people, which translates into stability," he says

"Increased economic activity in Africa will surely erode the advance of extremists who prey on unemployed youths. We need to keep our bulging population engaged, and that is why I am a firm believer that the continent needs all its partners."

Despite China's bigger footprint on the continent, Higazy says trading has a short shelf-life, so the Asian giant needs to increase its industrial investments in Africa. He further notes that trade was a convenient entry strategy that addressed an underdeveloped manufacturing sector and a growing consumer market.

But Africa is now keen on bridging the trade imbalance that is currently in favor of China.

His sentiments come in the wake of an increasing number of Chinese factories relocating to Africa. The continent offers cheap, available labor and untapped markets. But this has encountered headwinds, including high energy costs, lack of infrastructure and unattractive investment policies.

Acknowledging this environment, he calls on African governments to formulate policies that make their countries safe and attractive prospects for private and foreign investors.

"Charity starts at home. We need innovative policies designed to lure Chinese investors. Remember, we are competing against other stronger countries such as the Philippines and Vietnam."

Over the recent past, Egypt has been seriously pursuing economic reforms to improve its investment climate following four years of turmoil. It has cut fuel subsidies while introducing value-added tax, simplified bankruptcy proceedings, amendments to the capital markets law, a new insurance law and a land management framework.

This complements previous reforms that saw Cairo remove most non-tariff measures and decrease tariff protection, which liberalized the market significantly. It has also launched several programs to attract foreign direct investments, at an all-time low of 4 percent compared with 8 percent in 2011.

However, the diplomat says the recent approval of an International Monetary Fund loan of $12 billion is a boost to the economy. He says some funds will be channeled towards boosting electricity production capacity from 14,000 to 17,000 kilowatts to light up homes and power industries. Clean power alternatives such as gas and nuclear are also under exploration.

He is glad that the Chinese yuan joined the IMF's basket of reserves, saying that settlements would now not have to be converted into dollars, which always increases trading costs.

Higazy notes that aid advanced by China during Xi's visit early this year has had a tremendous impact on the economy. It was not only a vote of confidence in the new administration but also a cue to other investors. This has been coupled with increased Chinese engagement with TEDA Investment Holdings, a Tianjin-based company moving in to construct the Suez Canal Special Economic Zone.

"This is not an Egyptian project but for African investors, too, who need a platform to push their goods into European and Middle Eastern markets as well as Asia."

He criticizes Africa's disjointed global approach, especially in the competitive tourism market. Although markets such as Egypt, Kenya and South Africa have world-class offerings, they have yet to capture a sizeable portion of the lucrative Chinese market.

Kenya received about 50,000 visitors while Egypt managed 100,000 in 2015. South Africa, on the other hand, managed to bag 8,858 in July this year, an increase of 64 percent from the previous month. He says this performance is dismal in view of the fact that 100 million Chinese traveled abroad last year.

"Tourism is a very strategic industry for Africa and I think the continent should harmonize its offerings to improve its global competitive edge."

Higazy says the continent should develop joint programs that showcase its cultural attractions, which he believes will impress Chinese visitors. Promotions should encourage Chinese firms to hold their annual meetings in Africa, he says.

"We also need to work together when it comes to capacity building to understand what the continent offers. We should benefit from each other's capabilities. Together we can build a powerful, unique proposition. The joint visa program launched by the African Union is a move in the right direction."

He says, collectively, the continent can also address shocks such as the Ebola scare in West Africa, as well as terrorism, which affects the sector negatively.

"Terrorism is an international issue now, and Africa can collectively face it rather than fragment it into regions," he says

He recently visited China for the G20 summit in Hangzhou, where the host country campaigned for greater inclusivity as the solution to global economic growth.

"China supported Africa's industrialization and made it very clear that the exclusive club of developed countries needs to open up to a bigger market of consumers and producers," Higazy says.

Lucymorangi@chinadaily.com.cn