China plans big projects in Namibia
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05 September 2014
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bus china 05 augCHINA plans to invest in Namibia’s railway infrastructure in order to facilitate business activity between the two countries, as well as aid rural development, Chinese Ambassador Xin Shunkang said in an interview this week.

“A Chinese company is in discussions with the Ministry of Works and Transport to build a railway [line] from Tsumeb to Walvis Bay. It will transport cargo and passengers.

“The issue was how to raise the funds. The Ministry had the budget, but it could not release the funds on time.

“However, the Chinese company said that was not an issue; they could provide the funds to start the construction, and the Namibian Government could repay at a later time,” he explained.

The railway line will cost an estimated US$500 million (N$5.3 billion).

Those behind the project expect construction of the railway line to improve connectivity of the rural population to the coastal city, stimulate the establishment of small businesses across the railway line route and hence business activity between Tsumeb and Walvis Bay, and bring about development to rural areas.

“In China we have a saying: If you want to be rich, it’s better to build a road. When people connect with each other, they acquire new ideas.

“In addition, there are many Namibian enterprises that buy their goods from China. The railway [line] will enable them to transport their goods, and it will help Chinese companies transporting their goods throughout those areas,” the ambassador said.

China was also considering building a modern highway for Namibia connecting Hosea Kutako International Airport with Katutura, to improve the local traffic infrastructure. They expect this project to cost over US$100 million (N$1.06 billion).

The Chinese government continues to increase its footprint in Namibia, with several proposed investments and aid lined up for the country in the near future.

According to Xin, the Chinese government was working on at least ten new projects for Namibia, spanning various sectors such as transport, education and health.

  “Our hope is that when China develops very quickly, other countries such as Namibia can catch up. We will carry out more new policies and give more donations to the Namibian people.

“I can give you an example. When our Prime Minister Li Keqiang visited Kenya, he suggested that China collaborate with other African countries and set up railway [lines] to connect each country’s capitals.

“Can you imagine Windhoek connecting with Dar es Salam and Johannesburg by rail? It’s a very beautiful picture. We can work together to realise such a dream.” he said.

While local media reports have indicated that the Chinese mission had made a proposal to Air Namibia to introduce direct flights between Windhoek and three of China’s major cities, there were no concrete plans in that regard as yet.

Presence in Africa

China’s rapid growth to becoming a world super power with increased economic ties and financial interests globally has unsettled the west.

The country is making major investments across the globe in mining and railway infrastructure in a bid to meet its energy demands and improve transport connectivity between itself and the major nations of the world; in Africa, Europe and beyond.

Analysts’ predictions that resource-rich Africa will host many of the world’s fastest growing economies over the next decade have not been lost on China, with the country’s presence on the continent growing by the day.

“Everyone was concerned by the speed of China’s growth. The main thing is, China’s quick development will benefit the world. One of the reasons is that China makes very big contributions to the world.

“China’s health is important to the development of the world. But, when China develops, we do not forget our friends in Africa – we continue to invest and give aid,” Xin noted.

While indications are that the Asian powerhouse has the US rattling in its boots as another battle for Africa’s resources takes place, China has undoubtedly given Africa added capacity with a much needed industrialisation and manufacturing boost.

The country has also provided an alternative market for products typically dominated by the European Union (EU), for instance.

Recently, the EU, Namibia’s largest beef market, finally conceded to the major sticking points of the Economic Partnership Agreements (EPA), presumably because Namibia stood its ground, but also possibly, because it realised that it could not afford to throw its weight around or use bully tactics.

The Namibian and Chinese governments have undertaken lengthy negotiations regarding beef exports to China, a market large enough to absorb all of Namibia’s beef products.

While analysts say China would be unlikely to pay top EU prices for Namibia’s premium organic beef, the fact remains that it provides Namibia with an alternative market.

“The biggest breakthrough in bilateral trade this year is the lifting of the ban on the import of Namibian beef to China.

“During Prime Minister Geingob’s visit to China, the leaders of our two countries pushed the relevant authorities to work hard to ensure Namibian beef is served on Chinese people’s dining tables by the end of this year. We will realise this very soon,” Xin said.

The Namibia-China beef export negotiations were a further step in cementing diplomatic ties that have been in existence for a quarter of a century. In 2013, bilateral trade between the two countries peaked at US$739 million. 

By the end of 2013, China’s total investment in Namibia stood at US$3.9 billion (N$41.7 billion), mainly focusing on the mining and manufacturing industries.

“In line with the Agreement on Bilateral Economic and Technological Cooperation, China provided Namibia with free aid of US$29 million (N$310 million) in 2013 and US$16 million (N$171 million) to date this year,” the ambassador noted.

By far the most prominent milestone in Chinese investment came in the form of the joint venture between Chinese state-owned company China General Nuclear Power Corporation (CGNPC) and Namibian state-owned mining company Epangelo Mining, with Epangelo’s acquisition of a stake in the Husab Uranium mine.

With CGNPC’s total long-term investment of US$5 billion, Husab Mine will make Namibia the second largest Uranium producer in the world, providing 2,000 permanent jobs and 4,000 temporary jobs while contributing at least 5 percent to the Namibian GDP growth, Xin said.

The mine has reserves of an estimated 280,000 tonnes of uranium ore that would take close to two decades to mine. Xin said the uranium would supply the Chinese market, whose 18 nuclear power stations were in urgent need of the mineral.

Chinese companies are also planning to invest in maize and tobacco farming in the Zambezi region.

“The environment in Zambezi is very good and the land is fertile. The companies are now doing the preparatory work. Once the project starts, it will create jobs for 5,000 young people,” the ambassador stated.

WINDHOEK OBSERVER

The Windhoek Observer is an English-language weekly newspaper, published in Namibia by Paragon Investment Holding. It is the country's oldest and largest circulating weekly.

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