‘Resource nationalism’ clouds China’s Africa ambitions – by MASANORI TOBITA and TETSUSHI TAKAHASHI (Nikkei Asian Review – June 23, 2018)

https://asia.nikkei.com/

VIENNA/BEIJING — Rising nationalism in African nations over control of resources is starting to overshadow the efforts of Chinese and other foreign companies to develop their operations on the continent.

Some countries are demanding that foreign companies involved in mining invest in local companies, and plan to increase taxes on such foreign enterprises. These countries aim to fill their coffers by reclaiming ownership of mining concessions, anticipating a recovery in global resources prices.

On Wednesday, Chinese President Xi Jinping outlined plans for a tour of Africa in July in an apparent effort to shore up ties with various countries on the continent. The initiative comes as China’s relations with the U.S. have been strained by concerns over trade and security.

But rising “resource nationalism” in Africa may impede China’s diplomatic efforts to expand its influence on the continent. In March, the Democratic Republic of Congo in central Africa introduced a law requiring foreign mining companies transfer their shares to local companies. It also called for higher taxes on foreign companies.

Congo produces about 60% of the global supply of cobalt, a rare metal in high global demand as a key material in the production of auto batteries. China’s Zijin Mining Group along with Switzerland’s Glencore opposed Congo’s move, and are preparing to sue the government.

For the rest of this article: https://asia.nikkei.com/Politics/International-Relations/Resource-nationalism-clouds-China-s-Africa-ambitions2

Comments are closed.