Africa gets big boost in Shanghai

The glittering towers of the Pudong New Area have long been China's unequivocal message to the world that it is in the full throes of modernization. Now, the Shanghai district that has been transformed as the country has opened up is playing host to a huge project that promises to revolutionize the way China does business with Africa.

Behind it all is a man from Zhejiang province who says he went to West Africa 14 years ago when he was 24 with $700 in his pocket, and subsequently built a multimillion-dollar business empire that has dealings with many African countries.

He Liehui's project is the Africa Center, a complex of nine buildings covering 130,000 square meters in Jinqiao Export Processing Zone, 15 kilometers east of the Oriental Pearl Tower.

His Touchroad International Holdings Group, which has interests in finance, mining, real estate, tourism and trading, says it is pouring 1 billion yuan ($163 million) into the Africa Center. He says that by the end of the year the bulk of African countries, about 40 out of 56 countries and regions, are expected to open offices in the Africa Center, which is close to about 70 Fortune 500 companies.

The aim is to put Africa and its businesses in closer contact with Shanghai and the Yangtze River Delta region, including the teeming economies of Jiangsu and Zhejiang provinces, He says.

The GDP of the Yangtze River Delta region last year was worth about 10 trillion yuan, 18 percent of the national figure, Wuxi Statistics Bureau says, and in the same period China's investment in Africa rose by more than a third, the country's Ministry of Commerce says.

"Shanghai is an important economic bridgehead for China, and the Yangtze River Delta is an incredibly dynamic region," He says.

"Many companies are looking for opportunities in Africa, and African countries also attach great importance to this area."

By the end of August, companies in Shanghai had invested about $360 million in 27 African countries and set up 83 companies in the continent, the Shanghai Municipal Commission of Commerce says.

Last year, Zhejiang province's trade with Africa was worth about 139 billion yuan, 22.6 percent more than the previous year, and by the end of April this year more than 460 companies from the province had invested a total of more than $1.4 billion in Africa, the province's Department of Commerce says.

The 40 African governments that have signed a memorandum of understanding with Touchroad to set up consulates or representative offices in the Africa Center would provide services and information to attract investors and visitors from China's most economically dynamic regions. In addition, dozens of private companies plan to set up offices there.

The center would be the only one-stop service shop in the country serving as an economic and cultural exchange center between China and Africa, He says. Much of its attraction is the fact that hundreds of thousands of people who had been forced to beat a path to Beijing on business or tourism fact-finding missions, or merely to apply for visas, will be saved the hassle.

Frederick Shava, Zimbabwe's ambassador to China, says: "China is very big, and people all across the country need to go to our Beijing office for visas, which means a lot of travel."

Another primary reason for Zimbabwe's opening an office in the Africa Center is that a great deal of Chinese investment in the country comes from Shanghai and neighboring Jiangsu province, Shava says.

"With our people in Shanghai, it's easier for investors and visitors to go and get a visa and find out which industries and projects you can invest in in Zimbabwe."

He Liehui says: "We want to provide a one-stop consultative service for Chinese investors. Companies wanting to invest in Africa would be able to find out here about economics, the legal system, culture, and tourism, and if they want to visit the country they would be able to obtain visas more easily.

"I want it to become creditable. Those wanting to invest in Africa would visit the Shanghai Africa Center first. When an African country wants to promote itself to China, it would do that through the center."

China and Africa have long been in desperate need of something like the center, He says, an idea that came to him during the Shanghai World Expo in 2010.

"During the expo, many African leaders said they wanted to retain the concept of the Africa pavilion with its very positive influence, and I thought it was a great idea."

At the time, He had planned to build a Diamond innovation park to sell gems to Chinese, but he then switched his focus to the Africa Center.

African governments are very enthusiastic about the center, He says, and have put forward many ideas to help to enrich what it does. For example, given that tourism is Zimbabwe's dominant industry, the country's officials have suggested more emphasis be put on this aspect. President Robert Mugabe also paid a visit to Shanghai in August.

The government of Lesotho is particularly keen on education, seeing it as critical to national development, and it has said it hopes the center will provide the opportunity for China-African culture and art exchanges, He says.

"The center is like a more enriched and more diversified Africa pavilion following the Shanghai Expo."

The center will have five main sections:

The Africa Visa Application Center helps African embassies in China process visa applications, the final decisions being left to embassy or consular officials.

The African Investment and Trade Promotion Center would be dedicated to providing detailed investment information to Chinese investors. It would also put people in contact with one another and arrange meetings with parties in the countries a businessperson is traveling to.

The African Culture and Art Center aims to spread Africa's vibrant culture and diversified arts in China through exhibitions, lectures, performances and training.

The African Tourism Promotion Center would showcase the continent's wildlife, natural environment and cultural heritage to raise the profile of the continent among potential tourists from China.

"Chinese people are frequent travelers to the US, Europe, and elsewhere, and now many would like a change of flavor," He says. "Africa is rich in travel resources that are worth introducing to Chinese."

The African Museum would showcase African customs, history and culture.

He Liehui has never lost his interest in diamonds, and there will be a section devoted to the subject in which companies from Africa and Europe would sell diamonds from the continent.

Construction of the center is finished and interior decorating is still being done, and all offices will be ready by the end of the year, He says. Construction of Internet sites related to the center is also in full swing.

In October last year, more than 20 countries declared that they would give the center their full backing, and more countries are in talks with the center, He says.

"For them the aim is to attract more investors and visitors, to help more African students to study in China and to disseminate in African countries information and ideas about China's development."

The level of interest that African governments are showing in the center may come as no surprise given the financial incentives and services offered to prospective tenants. Consulates and representative offices are being offered rent-free space for three years, He says, and a staff of more than 100 is being put together to manage the center, and those two entail considerable financial outlays, he says.

"But with this project, I am looking at the bigger picture. Yes, it costs us a lot to build the center and to offer space rent fee, but that increases our possibilities in Africa, and by extension the business we stand to make there. Good communications and a firmer relationship between China and Africa open up investment opportunities. We hope African countries will see Touchroad as a responsible company that has a lot to offer in promoting business exchanges and collaboration."

The Visa Application Center has been running on a trial basis since early August and has already helped more than 100 applicants obtain visas, 80 percent of them business visas.

Liu Guozheng, director of the visa center, says many countries, among them Botswana, Djibouti and Lesotho, have authorized it to help them collect, screen and verify visa applications. There is a fee of 500 yuan for the service, plus any fee the countries charge.

"We are still training people and in the test phase," Liu says. "That's important, because if you are slipshod with the applications and make mistakes, people are not going to trust you."

Akilesh Gunputh, a student from Mauritius studying for an MBA at Shanghai Jiao Tong University, works in the visa center processing applications.

"It's good that I can combine what I have learned at school with my work here," he says.

Yin Hao, chairman of Shanghai GICI Supply Chain Management Co Ltd, which helps small and medium-sized enterprises with foreign trade, says he has just come back from Djibouti with He. Yin says his company has invested about $500 million in Africa through local partners, and is now considering direct investment there.

"Honestly, there are few avenues in China for learning about Africa. At the moment we mainly get our information about Africa through business-to-business channels, through friends, and magazines and advertising.

"I think the Africa Center will be a very good platform. Because it has been set up by a private company, I think it will be more direct and more flexible, and will show more initiative."

Shava, the Zimbabwean ambassador, says his country plans to dispatch two officials for each division in its offices to the center. Trade between China and Zimbabwe was valued at $1 billion last year, Shava says, and he forecasts it will rise 50 percent this year.

Abdallah Abdillahi Miguil, Djibouti's ambassador to China, says his country will set up a consulate in the Africa Center, and have two Chinese-speaking staff there to promote his country's culture and offer consular services to Djiboutians.

"The idea of having a center is exceptional. It's the result of excellent vision and will certainly facilitate and develop relations between our two continents. The Africa Center will be the place to exchange and meet for all Africans and Chinese. That will undoubtedly encourage Chinese businesspeople to come and invest in Djibouti." Miguil says there have been many achievements in trade and economics between China and Djibouti, and trade has increased significantly, from $249 million in 2008 to $1 billion last year. Many of the Chinese companies are in civil engineering, construction, housing, railways and telecommunications.

Nevertheless, despite the huge opportunities for China and Africa, there is still a lot to do to translate those opportunities into realities, He says, and he hopes the center will play a big role in that.

chenyingqun@chinadaily.com.cn