Chinese Investments in Africa: World Bank Talks

September 2, 2009

Robert Zoellick World Bank President

Chinese investments into a commercial private equity vehicle under World Bank steering has been encouraged by the World Bank, who expressed its interest in the participation of Chinese investments through such cooperations. It still remains open to see if China is willing to jump on this wagon.

Robert Zoellick, the President of the World Bank is currently visiting China and has recently met a number of Chinese government officials to discuss various development related issues, among others also the possible involvement of China Investment Corporation in contributing with investments to an asset management company – lead by the World Bank – and that is supposed to manage funds for various projects within private sectors.

This newly launched private equity management is supposed to invest in private and commercial projects throughout Sub-Saharan Africa and Latin America. China Investment Corporation – CIC – is China’s sovereign wealth fund and possesses strong governmental support and is able to allocate huge resources, and would be the matching cooperation partner for the World Bank regarding this issue.

It is not yet clear wether CIC is going to make this step and join efforts with the World Bank through investing into this vehicle, however leading officials from with China Investment Corporation have expressed interest in such an undertaking, according to Mr. Zoellick and the World Bank.

Hoping that Chinese companies will further develop and invest into manufacturing throughout the African continent, Mr. Zoellick met with high ranking officials from the Ministry of Commerce and discussed the possibilities of supporting construction and set up of dedicated industrial development zones in Africa.

The world is changing rapidly, and with the emerging of a new multi-polar world where new markets and continents become a thriving force of development, the African continent needs to become a force of growth, and not only by outputting natural resources but also by building up a healthy consumer market and develop its own industrial production bases to better benefit from its wealth of natural resources.

Mr. Zoellick, who’s currently visiting China after returning from Uganda and Rwanda, is scheduled to visit Anhui and meet with officials in Bengbu to look at a major World Bank approved project for urban water management, where a US$ 100 million loan was approved in 2008.

His bullish forecast for the Chinese economy of an expected 8% growth is higher than the official World Bank forecast of 7.2% for 2009, which raised from 6.5% in June.

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{ 1 comment… read it below or add one }

1 Alexander D. September 4, 2009 at 13:12

Why would China invest together with the World Bank? They’re not known for having the best of relations, and lately there’s been a couple of issues between China and the World Bank / IMF in several countries around Africa.

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