SA, China shake hands on $2.5bn deals

2011-09-29 14:40

Beijing - China has agreed to $2.5bn in investment projects with South Africa, the deputy president said on Thursday, on a three-day trip to China during which he brushed off controversy over a potential visit by the Dalai Lama.

Deputy President Kgalema Motlanthe said the agreement was made between the Development Bank of South Africa and China Development Bank, and that the two countries had also signed a memorandum of understanding on "geology and mineral resources".

South Africa exports about $5.5bn a year in minerals to China and Africa's largest economy increasingly has been a destination for Chinese foreign direct investment. Motlanthe provided few details on the investment plans.

"This financial cooperation agreement is between development banks and the specific projects in which they are going to invest; they still have to identify these projects," Motlanthe told a small news conference.

Motlanthe said the deals were intended to "strike a healthy balance" in trade volume between the two countries.

"To that end, the difference is, instead of just exporting these minerals as raw materials, there will be... value add to create jobs on both sides," he said. He is due to meet with China's President Hu Jintao on Friday.

China last year invited South Africa to join the Bric (Brazil, Russia, India and China) grouping, a diplomatic coup for President Jacob Zuma. It was seen by analysts as a Chinese stamp of approval for the country's role as a stepping stone to the African continent.

Trade, not Tibet

Motlanthe's trip has been slightly overshadowed by a potential visit to South Africa by exiled Tibetan spiritual leader the Dalai Lama, a man China reviles as a separatist and whom it repeatedly warns other countries not to receive.

South Africa has not yet decided whether to allow a visit by the Nobel Peace laureate, who was invited by Archbishop Desmond Tutu to attend his 80th birthday celebration in early October.

The Dalai Lama, once embraced as a beacon of peace in South Africa when apartheid ended, has become a diplomatic headache for the country as its economic fortunes are increasingly linked to China.

Motlanthe made clear that his visit to China, which included a meeting with China's Vice-President Xi Jinping, was aimed at bolstering economic ties, deflecting questions about the exiled Tibetan monk. He did not say whether the issue had been raised in meetings with Chinese officials.

The Dalai Lama rejects China's charges that he espouses violence and denies seeking independence for Tibet, saying he wants a peaceful transition to autonomy for his remote homeland which China has ruled with an iron fist since 1950. 

  • gatvol4corru - 2011-09-30 18:48

    what is in it for Jacob and the extended family?

  • Dave - 2011-10-01 10:08

    After Zimbabwe china will be the proud exporters of imigrants into SA, where they will set up whore houses, rhino horn, money laundering, ganglands and many other illegal syndicates to milk and deprive us from jobs, property, housing etc. and give us unbelievable credit forcing us to be so dependant on them forever, then one day they will strike........... But the powers that be see only the roses the opportunity to make a few quick bucks.... why do you think that their escapades into other 1st world countries are unsuccesful?

  • Phaedioux - 2011-10-05 19:21

    Where are the jobs being created? Investing money in a state run bank for future projects that are as yet undidentified is not going to create jobs?

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