News

China now enjoys trade surplus with Africa

Commodities1China now enjoys a large trade surplus with Africa because commodity prices have fallen in recent years and reduced the value of its imports. Lower prices of commodities such as metals explain why the value of Africa’s trade with China fell from $220 billion in 2014 to $149 billion in 2016, according to estimates from Sarah Baynton-Glen, an economist at Standard Chartered. She spoke to delegates at The Network Forum, a banking industry conference held this week in Cape Town. “We have a trade deficit,” added Simon Freemantle, senior political economist, Standard Bank, who also addressed the conference. “Commodity prices fell but African countries didn’t reduce their imports from China.” Some speakers worried that the trade deficit would disadvantage African countries in their dealings with China. Paul Clark, a fund manager at Ashburton Investments, said China’s foreign investments across Africa were proportionate to its foreign investments in other continents, suggesting Africa was not being singled out as a focus for Chinese capital. ©2018 funds global asia

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