Record investment in Africa spearheaded by China: World Bank

July 11th, 2008 - 5:53 am ICT by IANS  

Washington, July 11 (DPA) China has taken the lead in building up infrastructure in some of the world’s poorest regions in Sub-Saharan Africa, the World Bank said in a new report released Thursday. India and some Middle Eastern countries have also contributed to a record number of infrastructure projects being financed in southern Africa, an area of the globe that has long been neglected by international investors.

In a growing sign of cooperation between developing countries, the World Bank said that emerging economies’ investment in Africa had jumped from an average $1 billion per year before 2004, to 8 billion dollars in 2006 and $5 billion in 2007.

Much of Africa’s infrastructure remains woefully inadequate and is cutting the continent’s growth rate by an average of one percent per year, due to extra transport costs and a lack of power generation. The new influx of funds could help address those inefficiencies, the bank’s report said.

But China has also gained from the partnership, acquiring 22 billion dollars worth of natural resource exports from Sub-Saharan Africa in 2006, up from only $3 billion in 2001. Of those exports, 80 percent is petroleum to feed China’s surging energy needs.

The complementary demands have created a win-win situation for both sides, according to Vivien Foster, a World Bank economist and lead author of the report.

Chinas growing demand for natural resources is matched by Africas significant and often under-developed oil and mineral reserves,” Foster said. “Africas urgent need for infrastructure is matched by Chinas globally competitive construction industry.”

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