China rapidly becoming Mozambique’s main partner

13 June 2011

Maputo, Mozambique, 13 June – China is rapidly affirming its place as the main foreign power in Mozambique, replacing other traditional political and economic partners base on growing foreign trade, investment and cooperation, according to researcher Loro Horta.

“At a time when the West is facing an economic crisis, China and other emerging economies are becoming crucial to the wellbeing of several African nations. Chinese-Mozambican relations are expected to continue to grow with Beijing becoming the main economic and strategic player in Mozambique and in East Africa,” said Horta in a study published in May.

In, “The Dragon and the Mamba: The Growing Presence of China in Mozambique,” Horta analyses the main development of Chinese involvement in that Portuguese-speaking country, which he says over the last few years has reached an “impressive” level.”

China provided exemptions on 420 Mozambican agricultural products and trade more than tripled between 2007 (US$208 million) and 2010 (US$690 million), whilst large investment have been channelled into infrastructure, mining and agriculture.

The Export-Import Bank of China has provided the Mozambican government with funding of US$2.3 billion for construction of a large dam – Mpanda Nkua – and Chinese companies have been building road, bridges, military facilities and hospitals as well as the country’s main airport, in Maputo, and several public buildings.

“China is emerging rapidly as the most important player in Mozambique, bringing billion of dollars in investment without asking questions,” said the researcher.

Despite some points of tension between the two countries on labour and environmental issues, bilateral relations, “are seen as largely beneficial,” to both sides.

The main Chinese investment in the country so far is for US$1 billion, which is a project by Wuhan Iron and Steel to produce coal, but a project by its competitor Kingho for the same sector has also been announced and is worth US$5 billion.

A business seminar organised by the Mozambican governor in Shanghai in June 2010 ended with pledges to invest US$13 billion, for production of cement, cotton and agricultural goods.

The awaited launch of the first flight between Maputo and Beijing is expected to translate into increased Chinese tourism in Mozambique, and according to the Mozambican press the number of Chinese tourists may reach 1 million in the next decade.

Another point of interest is the modernisation and expansion of the port of Beira, which can be used to ship production from Chinese facilities in neighbouring countries such as Zambia and Zimbabwe.

George Wang, spokesman for a consortium interested in investment said that his their diamond production was currently exported by land to the port of Durban in South Africa, which is further away, and that Beira would be preferable for the countries in the region if the facilities were modernised, according to Horta.

Even faster expansion of China’s influence in Mozambique is stalled by the country’s conditions of safety, crime and poor quality of infrastructures, the researcher said.

So far the Mozambican authorities have managed to keep a balance between the several powers at play, but this will be tested as interest from India, China and Brazil grows in its energy resources and raw materials.

“China is now rapidly replacing former traditional colonial powers on the continent as the main player,” he said.

Loro Horta is originally from East Timor and a graduate of the University of National Defence of the People’s Liberation Army (China), and he lived in Mozambique for many years. He currently works with several research centres all over the world. (macauhub)