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Skills crisis: China

Published date:
Friday, 16 November 2007

Cape Town - Trade and industry minister Mandisi Mpahlwa told delegates to the US-Africa Business Summit on Thursday that there was not sufficient diversity of products traded into the American market.

He said that at the US/South African bilateral meetings to discuss the working of the African Growth and Opportunity Act (AGOA) that two things always stand out in sharp relief.

"One is that volumes of trade have increased," he said. "The other is that there isn't sufficient diversity of products going into the American market."

He pointed out that China had diversified its investments in Africa to include not merely extraction industries and resources, but also infrastructure, telecoms, clothing and textiles, electronics, fishing and marine culture.

India too had been expanding the areas in which they have been trading: automobile parts, stone crushing, gems and jewellery.

"What Africa needs is greater diversity to its economy," he said.

Mpahlwa told the conference that relations with China were somewhat different from US African relations. The number of items exported to China at zero tariffs had now been increased from 190 to 440.

At the China/Africa cooperation meetings, loans and credit have been agreed. A $5bn development fund had been established. This had been done on a basis of political equality.

"It does point in a direction that other partners for Africa have to increase the number of things they do together," he said.

He said that China, which was a developing country itself, understood the needs of developing countries in Africa. Speaking mainly to the African delegates present he agreed that China was pursuing its own interests when it traded with the rest of the world, and this, he suggested, was what Africa should also do.

Technology transfer had been important to developing the Chinese economy, and already China was responding to the skills challenge.

"Thousand and thousands of highly skilled Africans are coming out of the training institutes in China," he said.

But he also acknowledged that China was not going to give Africa all these things on a plate. "We have to engage with China to maximise the benefits," he said.

He said Africa had to do the same with the US. "We need more value-added goods to sell to the US market," he said. And he added that there were huge capacities and resources which could be leveraged from the US to do this.

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