China’s grip on foreign investment in Africa has been strengthened by a deal announced in October that will see a Chinese company – in return for an investment of $7bn in oil and mining infrastructure – getting preferential treatment for all mining projects in the west African country of Guinea.
According to the Financial Times, the deal, set to be finalised by the end of 2009, could put Chinese interests directly against Western ones at a time of increasing competition over African resources. The deal could also raise support for the government of Moussa Dadis Camara, who seized power last December after the death of long-term dictator Lansana Conte.
Human rights groups claim that in September the Guinean military was involved in the massacre of 150 opposition protestors, renewing concerns that Chinese investors are helping to support corrupt African governments.
Guinea has the world’s largest deposits of bauxite – the most important aluminium ore – as well significant amounts of uranium, gold, diamonds and iron ore.
There are also indications that oil could be recoverable and the Camara government has signed a memorandum of understanding for an oil prospecting deal with Hong Kong-based China International Fund and Angola’s state-owned oil company Sonangol.
It is estimated that trade between China and Africa is now worth about $100bn a year, which is mostly generated by mineral and oil deals and is more than 10 times the investment levels seen on the continent in the 1980s.