China has good lessons to teach Africa

Africa has much to learn from China and more so from the super-power’s operations on the continent. Malusi Gigaba, minister of public enterprises, believes there are major opportunities for African companies to learn from the Chinese rather than looking with resentment at how they approach business. “We must start to engage with them as equal partners and learn from the way they have approached opportunities in Africa.” He told FTW that the rapid growth of the Chinese economy in recent years had called for massive resource requirements, which they had achieved. “It is estimated they are involved in over 700 infrastructure projects in Africa. They want minerals and they appreciate the fact that to get to the resources requires infrastructure,” he said. “Clearly, underlying the Chinese government strategy in Africa there is a well thought out holistic plan. There is much we, as Africans can learn from that.” This includes the fact that the Chinese have worked out a specific business case for their investments in Africa. “In this regard South Africa needs to develop its own approach to Africa – how are we going to grow our own footprint? What is our business case and do we know how we are going to achieve it? The Chinese do,” he said. According to Gigaba, there is major opportunity for South Africa’s State-owned Enterprises (SOEs) in this regard. “We are behind schedule. We have yet to identify the areas where our SOEs and our private companies can invest, where we can form public partnerships to leverage and transfer skills knowledge,” he said. “We need to involve the South African private sector – particularly the mining and financial services – in the African engagement programme, and we need to do it now.” He said financing infrastructure in Africa remained a key constraint and it was time to investigate new ways of overcoming this challenge, while at the same time a more ‘South Africa Inc’ approach was needed. “It is all about the industrialisation of the continent and the development of downstream sectors. Unless we can localise and achieve the objective of extracting value out of primary commodities we will remain exactly where we are and not benefit from the African boom.” With more than $90 billion dollars needed for African infrastructure, Gigaba said it was clear the continent could not transform on its own. “The time has come to seek partners and develop mandates that are uniquely placed to add value to African infrastructure development. We must understand that the prosperous future of South Africa is intrinsically bound to that of the continent and therefore we need to be relentless in pursuing economic diplomacy.” INSERT ‘We must understand that the prosperous future of South Africa is intrinsically bound to that of the continent.’ CAPTION Malusi Gigaba … ‘South Africa Inc approach needed.’