World Economy

China Aims for $400b Africa Trade

China Aims for $400b Africa TradeChina Aims for $400b Africa Trade

Since China overtook the United States in 2009 to become Africa’s biggest trading partner, the writing has been on the wall that the US is not really engaged with the continent.

US and China have taken different tacks: While the US has linked aid and trade to initiatives to improve democracy, China has largely avoided any strings, but that could be changing as it moves troops to South Sudan to protect its interests, Aljazeera reported.  

In 2014, trade between the US and Africa was $73 billion–that is down from $125 billion in 2012. China’s trade has risen to $222 billion in 2014 and Chinese Premier Li Keqiang has high hopes for Sino-Africa trade; he is expecting it to almost double to $400 billion by 2020.

Africa is an attractive place to do business, not only for its natural resources. The economy of sub-saharan Africa is valued at $1 trillion. Debt is manageable, inflation is under control, and nations are, on average, likely to grow 4.5% this year.

The US through its African Growth and Opportunity Act that gives 40 African nations tariff-free access to the US market, has created more than 350,000 direct jobs in sub-Saharan Africa since 2000. However, many believe the US is not doing enough to help African countries face their different challenges.