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China investment in Africa to slow this year -ministry

Published 10/14/2010, 04:19 AM
Updated 10/14/2010, 04:24 AM

BEIJING, Oct 14 (Reuters) - Chinese investment in African countries will grow at a slower pace this year because of an uncertain economic outlook in the region, the Commerce Ministry said on Thursday.

The slowdown should only be temporary, and Beijing aims to invest in a wider range of industries on the continent, including new energy, financial services and manufacturing, said Zhong Manying, head of the ministry's West Asia and Africa department.

Zhong did not provide any investment growth data for comparison. Chinese direct investment in Africa totalled $9.3 billion as of the end of 2009, according to the commerce ministry.

"We will retain our existing investments in Africa and further expand to other industries as time goes by," she said at a media briefing.

Beijing has had to pull back from some of its investment deals in Africa under pressure from both local authorities and Western donors, fueling speculation that the world's second-biggest economy might begin to turn away from the resource-rich continent.

Chinese firms have been striking deals in areas of the world often overlooked by Western firms to secure the energy and resources needed to support its fast-rising economy.

Chinese Commerce Minister Chen Deming told Reuters last month that Beijing takes a different tack in extending aid to developing countries, eschewing tough terms demanded by Western donors. [ID:nN2291523]

China has pledged $10 billion in preferential loans to Africa and said it will triple the China-Africa Development Fund to $3 billion.

On the trade front, China will offer zero tariffs on 95 percent of its imports from the least developed countries in Africa in the coming three years.

Rising demand and strong commodity prices could push two-way trade with Africa this year beyond the $106.8 billion record registered in 2008 after it fell to $91.1 billion in 2009, the ministry said. (Reporting by Aileen Wang and Simon Rabinovitch; Editing by Ken Wills)

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