Building on a long history of mutual trade
Hunan province, African countries benefiting from growing exchange of goods and investment
Despite the ill-fated voyage of a merchant ship departing from Changsha and bound for Africa some 1,200 years ago, trade between Hunan province and the African continent has since thrived. In 1998, 50,000 pieces of porcelain made in Changsha were fished out of the ocean from the more than 1,000-year-old shipwreck.
In recent years, the economic relationship between the province in Central China and Africa has become closer and more successful, as Hunan expanded transport routes and trade platforms related to Africa.
Changsha hosted the first China-Africa Economic and Trade Expo in June 2019, which marked a new phase in cooperation between Hunan and Africa.
The expo saw 84 Sino-African projects and agreements worth more than $20 billion signed, involving more than 20 African countries such as Angola, Cote d’Ivoire and Senegal. They cover traditional Sino-African cooperation fields, including agriculture, mining, energy, infrastructure and industrial parks, and those representing new development directions such as advanced manufacturing and e-commerce.
The projects are going well, local media reported. A seed company headquartered in Changsha is implementing a hybrid riceplanting project in Nigeria. The Hunan industrial park in Uganda saw its investment and operation body register with local authorities.
The Tanzanian branch of a tech company based in Beijing received about 324 square kilometers of land granted by the Tanzanian government in July. The project was also an important cooperation result of the first expo.
The Beijing company signed a framework agreement at the expo. According to that, the company would build a cooperation development park including an export processing area and an agricultural planting park.
The project is expected to export 2 million metric tons of agricultural products annually after completion.
Hunan has further developed opening-up platforms toward Africa, with the China (Hunan) Pilot Free Trade Zone set up in September 2020.
To build the Pilot Zone for In-depth ChinaAfrica Economic and Trade Cooperation is one of the trade zone’s three major tasks.
The pilot area is developing three centers for African nonresource product trade, SinoAfrican economic and trade business incubation and Sino-African economic and trade comprehensive services, and a platform of Sino-African financial services. It will explore new mechanisms for Sino-African in-depth cooperation involving cross-border renminbi settlement, barter trade, financial support and comprehensive services.
The area has formed industrial chains for African products such as coffee, nuts and cacao. It expects the volume of trade with Africa to reach 40 billion yuan ($6.19 billion) after three to five years of development.
Shen Yumou, Party chief of Hunan’s commercial department, said: “Hunan relies on platforms of the China-Africa Economic and Trade Expo and the Pilot Zone for In-depth China-Africa Economic and Trade Cooperation to build five large centers.”
Among them are centers of African nonresource product trade and processing and Sino-African cross-border RMB, according to Shen.
Hunan has opened two air routes connecting Changsha to Nairobi, capital of Kenya, and Luanda, capital of Angola. It will also expand passenger and cargo routes toward eastern, western and southern Africa.
A China-Africa rail-sea express train departed on Sept 15 from Zhuzhou, Hunan, carrying 1,935 tons of grain. China is offering it to assist African countries including Kenya. It is expected to arrive at a port in Kenya on Oct 15.
The train service is an innovative move for Hunan to develop a Sino-African logistics channel system. It offers a more convenient and economic logistics solution for Hunan — and even central and western China — to transport goods abroad, local media reported.
A report by the China-Africa Business Council, released in August, reveals that Chinese companies contributed to industrialization and social improvement while they invested in Africa. They have become an impetus for inclusive development in the African economy.
Trade and investment between Hunan and Africa has surged in recent years, with the province’s manufacturers having signed investment agreements worth nearly $1 billion.
Hunan helped to export hybrid rice seeds developed by late agricultural scientist Yuan Longping to several African countries, increasing the yield there by 100-300 percent. This has contributed to alleviating hunger in Africa, local media reported.
Companies including Changsha-based Yuan Longping High-tech Agriculture have embraced hybrid rice assistance projects designed for Africa since 2000. They have set up centers for hybrid rice experiments, demonstration and new variety research in countries such as Madagascar and Liberia.
A seed company from Changsha registered an agricultural development business in Madagascar in 2010. The business has built an industrial park locally, which aims at promoting Madagascar’s rice industrial chain.
The park has invested more than $12 million in Madagascar and bred five hybrid rice varieties approved by the Madagascar government. It can produce and sell more than 400 tons of hybrid rice seeds annually.
Manufacturers from Hunan are also developing in Africa. Zoomlion’s agricultural machinery products are popular in Africa as they are cost-effective, rich in variety and high-quality.
Considering insufficient electricity supplies in several African countries, agricultural machine maker Nongyou Group has replaced electric motors with diesel engines and developed suitable products for the African market.
Construction companies from Hunan can also be seen in Africa. Hunan Construction Engineering Group signed power grid projects with Ghana’s energy department in November, with an investment value of $88 million. It is a typical case of Hunan-based companies’ success in international markets, according to local media.
The group entered Ghana’s market in 2010. To date, it has helped more than 100,000 rural households access electricity in the country.