Chinese investment in the extractive sectors in Africa (methods, Research Paper

Chinese investment in the extractive sectors in Africa (methods, profitability, and deal flow) - Research Paper Example ate resources through support to African governments on one side and the empowerment of Chinese mining and exploration companies working in Africa (Rotberg 152). The Chinese government maintains close ties with African governments on the political, economic, human resource and security development of these nations (Dubosse 70). Politically, the country sends high level delegations to meet leaders on the African continent and by this, they maintain strong ties with high-level Chinese government units. Economically, China promotes trade , investment and the development of infrastructure on the continent for the mutual benefits of China and Africa. Human Resource Development is done in the form of scholarship for some selected Africans to study in China and other parts of the world and also through grants and scholarships for African students. In terms of peace and security, China provides support for various national militaries and also contribute immensely to peacekeeping operations o n the continent. Collectively, these strategies and systems allow Chinese businesses to get contracts in the energy and mining sectors of various African countries. The China-Africa Development Fund The China-Africa Development Fund (CADF) was officially launched in June 2007 as a branch of the China Development Bank to act as an investment facilitation vehicle for the Chinese expansion to Africa (CADF Website). According to the official website of the CADF, the equity fund is to provide loans and funds to Chinese businesses operating in Africa and since its inception, it has supported more extractive drives than any other sector. Every loan or funds released by the CADF must have a good justification as being beneficial to the State and it is guaranteed by the Chinese government (Taylor... The author of the essay "Chinese investment in the extractive sectors in Africa" begins with that Sino-African relations were taken to a different level in 2006 when the government of China announced a wide range of co-operation activities between China and Africa including political, economic, education, culture, health as well as military co-operations (Meine 184). The main document of the 2006 China-Africa Co-operation conference attended by 46 African leaders stated that â€Å"peace and development remain the main theams of our time†. It therefore took the initiative to support African economies to attain this end. The government promised to do this by supporting local African nations in their development projects. This is complemented by support to Chinese enterprises to trade in Africa and provide preferencial loans and buyers’ credits to these traders. In the end the author concludes that Chinese influence is growing in Africa, particularly the mining sector because China uses political, economic, cultural and military aid to create a symbiotic relationship for African countries and Chinese-African enterprises. This makes African nations willing recipients of Chinese investors. Chinese businesses are also supported by the China-Africa Development Fund which is a tool for the support of the Chinese expansion to Africa. China has major deal with Central and Southern African countries with copper deposits as well as other petroleum exporting countries. This contributes a lot of money to the Chinese economy.