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London - Chinese investment in Africa is expanding beyond a race to secure minerals and energy sources to put an increasing focus on agriculture, the chief executive of Standard Chartered Bank said on Wednesday.
Standard Chartered, with deep historic roots in Asia and Africa, believes it has benefited more than any other bank from the growing trade between China and Africa - expected to reach $100 billion in 2008.
Group chief executive Peter Sands said China's interest in Africa was clearly moving beyond the search for minerals and energy supplies for its booming economy, which has in recent years propelled Africa's fastest growth for decades.
"The focus is changing. What's interesting is how much more focus they're putting on exports to Africa and on agriculture, commercial agriculture," Sands told a meeting of the Royal African Society in London.
"It (Chinese investment) is more sustainable and has more complexity. This relationship is delivering substantial benefits to Africa."
Chinese imports from Africa - largely crude oil and minerals - rose 92% to $30bn in the first half of the year, while its exports to the continent -- mostly manufactured consumer goods - rose 40% to $23bn.
Sands said Indian and Middle East companies were also investing more in the search for resources from Africa, although the scale of that was still well behind the investment from China.
"Africa is structurally well placed to be a provider to India and China to its own benefit," Sands said.
"The one I'm particularly interested in is food and agriculture. I think Africa will be very well placed," he said, adding that China would not be able to sustain itself through its own resources.
Sands highlighted Zambia for its agricultural growth and potential.
Despite the global economic fears resulting from the credit crunch, Sands did not expect a change in the long term pattern of increasing Asian trade and investment in Africa.
"The strategic imperative to find sources of supply for Asia doesn't go away at all. It's more the Western companies that will be pulling back."
Sands said he believed Standard Chartered had done better than any other bank to win business from the increasing flow of money and goods between Africa and Asia, but faced growing competition.
"We are not complacent. Chinese banks see the opportunity and are moving in themselves," said Sands.
He pointed to the 20 percent stake that China's Industrial and Commercial Bank of China acquired this year in South Africa's Standard Bank, the continent's biggest bank by assets.
- Reuters