The announcement earlier this month that Angola had overtaken Saudi Arabia as China's premier supplier of crude oil underlined the deepening ties between the two red-hot economies.Angola is sub-Saharan Africa's second largest oil producer, after Nigeria, pumping 1.3 million barrels a day (b/d) - a figure the government expects to rise to 2 million b/d by 2008. Record oil prices are ensuring double-digit growth, and the country is in the middle of a reconstruction boom after a ruinous 27-year civil war ended in 2002...Chinese companies have been at the forefront of Angola's reconstruction bonanza. A new airport is being built at Viana, just outside the capital Luanda, one-third financed by the government, the rest by Chinese interests. The war-damaged Benguela railway, which stretches from the Democratic Republic of Congo to the coast, is being rebuilt as part of a Chinese deal worth US $200-300 million.The Asian powerhouse has also procured lucrative contracts to rebuild the nation's roads and a rejuvenated Angola Airlines is considering opening a direct route to Beijing...Nicholas Shaxson, Africa fellow of the UK-based think-tank Chatham House explained: "Chinese lending ... has allowed Angola's government to manage on its own without IMF backing. Angola has used its huge economic potential to secure a number of oil-backed bilateral credit agreements with foreign governments - which further weaken the IMF's leverage."
Wednesday, April 19, 2006
China has been engaged in relatively discreet economic negotiations and agreements with countries across the Southern Hemisphere. For the most part, these seem to be beneficial to China not only in economic terms, but also political terms as packages of loans and credit lines, development assistance, and technical assistance appear designed to wrench Southern economies' dependence on Northern/Western-run institutions such as the IMF. In this report, we have the case of China's involvement in Angola, which happens to be doing rather well economically after years of civil war, despite ongoing problems of poverty and corruption.