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China pioneers self-restrictive trade with Africa: expert
www.chinaview.cn 2006-06-23 20:46:35

Special Report: Premier Wen visits 7 African countries

    BEIJING, June 23 (Xinhua) -- China's voluntary agreement to restrict textile exports to South Africa makes it the first nation to offer such a commitment to promote economic development on the continent, a Chinese researcher has claimed.

    Chinese Premier Wen Jiabao made the promise to restrict exports of China's textile products to South Africa on Wednesday in Cape Town.

    "This move marks a substantial effort of the Chinese government in materializing its pledge to consider the economic development need of African trade partners," said Liu Naiya, associate research fellow with the Western Asia and Africa Studies Institute of the Chinese Academy of Social Sciences.

    Liu claimed that no other countries had ever initiated a similar deal benefiting only its trade partners.

    China's Ministry of Commerce is yet to disclose the details of the "self-restrictive measures" promised by Wen, but experts said the government might issue export licenses and set a maximum annual growth rate of its textiles exports to South Africa as it did last year with the European Union and the United States.

    The government could also take effective measures to encourage companies to support the growth of their South African peers through technology transfer and capital input, they said.

    Liu said the Chinese and South African governments had showed "tacit mutual understanding" in handling their textile trade disputes.

    Earlier this year, the South African government mapped out a package of policies to encourage domestic textile companies to upgrade production lines and move to high-end clothing and textile products so as to remain competitive against Chinese rivals.

    "China obviously hates to see relations with South African deteriorate and is eager to make a gesture by putting itself in South Africa's position," Liu said.

    Given that trade disputes between China and developing nations were on the rise, he said the deal had set "a valuable example" on dispute settlement.

    However, the response from China's business community was less positive. Chen Lingling, of the Beijing chief representative department of China's largest textile group China World best, said the domestic industry would definitely be affected by such policies.

    "Complaining is no use. We have to wait and see and find a way to deal with it," She said.

    No relevant guilds were available to comment on the issue at the time of publication.

    Trade investigations against China from developing nations like India, Turkey and South Africa accounted for almost two thirds of the 32 investigations launched by 18 countries and regions this year until May.

    Yao Guimei, an expert of African studies at the Chinese Academy of Social Sciences, attributed the rising number of disputes to surging bilateral trade.

    "Never before has China encountered so many trade disputes with its trade partners across the world," she said.

    The Chinese government was seeking to reduce trade disputes with African countries and maintain healthy Sino-African trade relations by showing the will to lift last year's 1.18 billion U.S. dollar direct investment in Africa, which was dwarfed by its 39.74 billion U.S. dollar Sino-African trade volume.

    For instance, Premier Wen's entourage to the seven African countries comprises business representatives from small and medium-sized private companies.

    "This is an important sign that the Chinese government has begun to support the overseas investment of non-state-owned companies," Yao said.

    To date, almost all investment projects in Africa have been won by state-owned companies that enjoy capital and policy privileges over small and medium-sized private firms, whose investment demand had long been suppressed, Yao said.

    The government was considering a package of policies for release in November to level the ground for private and state-owned firms in competing for overseas investment projects in Africa, Liu Naiya said.

    It was also trying to boost non-cargo trade, such as tourism, with its African partners.

    To date, China has granted 16 African nations, including Egypt, South Africa, Morocco and Kenya, tourism destination status for Chinese nationals. Enditem

Editor: Mu Xuequan
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