Home to extensive natural resources, corporate stability and large-scale infrastructure potential, Africa provides unique access to trade and investment opportunities for Chinese companies. Between 2022 and 2023, Chinese investment on the continent increased by 114%, showcasing the country’s commitment to strengthening collaboration across priority sectors.
Oil and Gas
China is expanding its stakes in strategic oil and gas developments across Africa. Last April, the Chinese government invited Uganda’s Minister of Energy and Mineral Development Ruth Nankabirwa Ssentamu to Beijing to discuss financing the $5-billion East African Crude Oil Pipeline. Chinese steel pipe manufacturer Panyu Kong Steel Pipe Company delivered the first 100 km of pipeline for the project last December.
Aligning with Angola’s target to increase oil production to 1.18 million barrels per day, as well as growing interest from China in supporting strategic investments in Angola, China’s state-owned China National Offshore Oil Corporation (CNOOC) sent a team of senior executives to Angola last May to discuss investment opportunities in oil exploration. According to Angola’s Ministry of Mineral Resources, Petroleum and Gas, the delegation from CNOOC discussed oil exploration opportunities around offshore Block 24.
Mining and Critical Minerals
Last month, steel manufacturer China Baowu Steel Group became a shareholder in Guinea-Conakry’s Simandou Blocks 1 and 2, which serve as the world’s largest untapped iron ore deposit – estimated at over two billion tons. In the same month, mining company Emirates Global Aluminum and China’s state-owned Aluminum Corporation of China signed a framework agreement to develop an alumina refinery in Guinea-Conakry.
In Zimbabwe, copper ores company China Natural Resources agreed to acquire mining company Williams Minerals’ lithium mine for $1.75 billion. The acquisition serves as a significant development in the global lithium market, as demand for the mineral continues to surge amid accelerated deployment of renewable energy technologies. As the global energy transition continues to gain traction, the procurement of critical minerals and materials needed to develop solar panels, wind turbines, EV batteries and other renewable energy solutions has brought growing international attention to Africa’s critical mineral resources.
Infrastructure
Last September, Algeria and China signed over 15 partnership deals spanning diverse industries including construction, telecommunications, steel and metal processing, paper and cardboard manufacturing, plastic packaging and more. The partnerships reflect a shared dedication to promoting economic expansion, facilitating knowledge transfer and generating employment opportunities. The two countries also announced their commitment to embarking on a 6,000-km railway project in Algeria, ushering in a new chapter in China-Algeria cooperation.
Meanwhile, South Africa signed eight agreements with Chinese companies last August to strengthen its electricity system and mitigate load shedding. The pacts will assist South Africa to expand its electricity generation, transmission and distribution networks, as well as upgrade the country’s sole nuclear facility, extend the life of coal plants, deploy technologies to reduce emissions and build solar photovoltaic (PV) manufacturing facilities.
Renewable Energy
China holds a unique opportunity to drive Africa’s energy transition, with Beijing emerging as the continent’s largest bilateral trading partner over the past two decades. Since the turn of the century, China has financed billions in large-scale infrastructure projects across Africa. Last May, the Transitional Legislative Authority of Burkina Faso greenlit a $49.5-million loan from China’s Export-Import Bank to finance the construction of the 25 MWp Donsin solar power plant and associated electricity storage system. In February 2020, China Energy Engineering Corporation announced plans to build 500 MW of solar PV generation capacity in Uganda at a cost of $500 million.
Information Technology
In Africa, Chinese firms such as Huawei, ZTE, Cloudwalk and China Telecom have been instrumental in developing and upgrading digital infrastructure across the continent. Earlier this month, Huawei announced its plans to train 150,000 people in sub-Saharan Africa to develop digital skills over the next three years.
As part of China’s Digital Silk Road initiative – aimed at expanding digital technologies in developing countries – Chinese companies are looking to establish a network of digital infrastructure projects across Africa. According to think tank Australian Strategic Policy Institute, China has built over 250 technology projects across the continent, including 4G and 5G telecommunications networks and data centers aimed at modernizing urban centers and education programs.
