On 4-5 November, in Beijing, capital of the People's Republic of China (PRC), we participated in the first ever Summit Meeting of the Forum on China-Africa Cooperation (FOCAC). Forty- eight African countries that have diplomatic relations with China attended the Meeting, 41 of them represented, notably, by their Heads of State and Government.

We took advantage of our presence in Beijing to transform Monday 6th into an Official Working Visit to the PRC, enabling us to engage President Hu Jintao and other government and business leaders of the PRC in bilateral talks.

Like all occasional visitors to China, we could not but marvel at the many signs of progress that are so visible along the streets of Beijing. That progress stands out as the palpable expression of the sustained annual rate of economic growth that we have come to expect of China, of 10% or more. The FOCAC and bilateral meetings took place at the Great Hall of the People, located on the famous Tiananmen (Heavenly Gate of the Peacemakers) Square that constitutes the heart of Beijing. To get to the Square we travelled every day along the wide boulevard, Changan Street, the busiest thoroughfare in the city, which is flanked on both sides mainly by modern high-rise buildings. But to arrive on Tiananmen Square is to come face to face with the fact of the long history of this extraordinary country, China.

We could not miss the striking traditional building on one side of the Square, the Tiananmen Tower, originally built in 1471 during the Ming Dynasty, marking the front entrance to the Forbidden City, the complex of palaces that served as both the seat of government and residential precinct of the Emperors of China and other aristocrats. For many centuries, until 1911, when feudal rule was finally defeated, leading to the installation of Sun Yat-sen as the Provisional President of the new Chinese Republic, only members of the royal family and other nobles were allowed to enter the Forbidden City.

But today, Tiananmen Square is also home to the 1952 Monument to the People's Heroes, which carries an inscription by the late Mao Zedong, which says, "The People's Heroes are Immortal", the imposing Great Hall of the People, built in 1959 to coincide with the 10th anniversary of the revolutionary victory of 1949, the Mao Zedong Memorial Hall which also serves as Chairman Mao's mausoleum, and the China National Museum, with the History Museum within it housing cultural relics that date back 1,700,000 years.

Once you are on Tiananmen Square, it requires only a moment's reflection to understand that you are now among an ancient people that is today 1.4 billion strong, and which is accustomed to thinking in the long term, easily understanding what Confucius meant when he said a journey of a thousand miles begins with one step.

Indeed, reflecting the capacity simultaneously to encompass both the ancient and the modern within the mind's eye, when he opened the FOCAC Summit Meeting, President Hu Jintao said: "Though vast oceans keep China and Africa far apart, the friendship between our peoples has a long history and, having been tested by times, is strong and vigorous. In the long course of history, the Chinese and African peoples, with an unyielding and tenacious spirit, created splendid and distinctive ancient civilisations. In the modern era, our peoples launched unremitting and heroic struggle against subjugation, and have written a glorious chapter in the course of pursuing freedom and liberation, upholding human dignity, and striving for economic development and national rejuvenation. The progress and development of China and Africa are a major contribution to the advancement of human civilisation."

Speaking later at the Official Banquet, he said: "As a Chinese saying goes: 'Bosom friends know no distance. Even living ten thousand miles away, they still feel close to each other like neighbours.' Though with vast distance between us, the Chinese and African people are as close as neighbours and brothers. China's friendly contacts with Africa date back to the second century BC. Zheng He, a famous Chinese navigator in the Ming Dynasty, reached the east coast of Africa four times, writing an important chapter in the history of China-Africa relations."

It therefore came as no surprise that President Hu Jintao could speak to us of the goals that China had set itself for The period 2000-2020, which timeframe, to this ancient land, represents nothing more than a step or two in the continuing journey of a thousand miles. In this regard, when he spoke at the Official Banquet, the President said: "Over the past 28 years since it started reform and opening up, China has made great achievements in development. However, China has a large population, a weak economic foundation and there is still uneven development in different regions. China's per capita GDP ranks after 100th in the world. The living standard of its people is not high, and China faces many problems and challenges in economic and social development. China is still a developing country. The Chinese people are now endeavouring to build a moderately prosperous society in an all-round way and accelerate the socialist modernisation drive. Our overall goal is to quadruple the GDP of 2000 by 2020 so that we will achieve greater progress in economy, democracy, science, education and culture, make the society more harmonious and ensure a better life for our people. As China develops itself both economically and socially, the Chinese people will continue to provide assistance and support to the African people in an effort to achieve the common development of China and Africa."

As we would expect, there are some in the world who, at best, think that it is paradoxical that a developing country with a relatively low per capita GDP, as correctly described by President Hu Jintao, can, at the same time, commit itself "to provide assistance and support to the African people in an effort to achieve the common development of China and Africa". At worst, these see this commitment as constituting nothing more than deceitful demagogy.

As a movement we should, by now, be familiar with this expression of scepticism or cynical rejection. In this context questions have also been raised about the international activities of our democratic Republic. The question is posed about how, given all the pressing challenges of poverty and underdevelopment we face in our country, deriving from the long period of colonialism and apartheid, we can also find the time and the resources, however limited, to honour our principled commitment to the practice of international solidarity, especially with regard to the rest of our Continent and the African Diaspora. However, regardless of what the sceptics and the cynics may think and say, there are a few important matters that our Continent must consider with the greatest seriousness, in its own fundamental interest. At the centre of these is that one of the most central and urgent challenges we face is the improvement of the standard of living and the quality of life of the masses of the African people. Like the PRC, and as President Hu Jintao said, we must achieve greater progress in economy, democracy, science, education and culture, make our societies more harmonious and ensure a better life for our peoples.

Again as President Hu said, we too must achieve all this within the context of "reform and opening up", understanding the inevitability of the globalisation process within which we must realise our goals, which results in the development of the integrated world market that was foreseen by earlier political economists such as Adam Smith and Karl Marx. Necessarily, among other things, this means that Africa must make a serious effort to define her relationship with the dominant economies in contemporary human society.

In its 2005 ranking of various countries by GDP, presumably expressed in terms of nominal exchange rates, the World Bank says that the Chinese economy is the 4th biggest in the world, with the 1st, 2nd, 3rd, 5th and 12th positions occupied by the US, Japan, Germany, the UK, and India. (The World Bank says the US GDP is nearly US$12.5 trillion, the Chinese US$2.23 trillion, the UK US$2.2 trillion, and the Indian US$785.5 billion.)

A similar US Central Intelligence Agency (CIA) series, which measures the 2005 GDP of various countries taking into account purchasing power parity, puts the Chinese economy as the 2nd biggest after the US. In this series, Japan, India, Germany, and the UK rank as 3rd, 4th, 5th and 6th. (This series says the US GDP is US$12.3 trillion, the Chinese US$8.9 trillion, the Indian US$3.7 trillion, and the UK US$1.8 trillion.). The World Bank ranks South Africa at 27, immediately preceded by Norway (25) and Denmark (26), and followed by Greece (28) and Ireland (29). It says our GDP amounts to US$240 billion.

On the other hand, the CIA ranks South Africa at 24, immediately preceded by Thailand (22) and Argentina (23), and followed by Poland (25) and the Netherlands (26). It says our GDP amounts to US$541 billion. Regardless of which one of these series, the World Bank or the CIA, is the more accurate in terms of measuring the relative sizes of the economies of various countries, the fact of the matter is that Africa must recognise and respond to the fact that the Chinese economy is one of the biggest in the world. (The South African economy - by far the biggest in Africa - is, relative to the Chinese, very small, regardless of whether we use the World Bank or the CIA figures. This emphasises the need for us as Africans correctly to respond to the realities of the world economy, but without defining ourselves as helpless and pitiful victims of globalisation, whom the rest of the world must treat as mere recipients of charity, described as humanitarian assistance.)

At four times its 2000 size by 2020, 14 years from now, as indicated by President Hu Jintao, the Chinese economy will be that much more significant as a global player. As yet another indication of the global weight of the Chinese economy, reflecting its international competitiveness, the international media reported while we were in Beijing that the PRC foreign currency reserves had hit the US$1 trillion mark, the first time in human history that any country had achieved this level of reserves. For the PRC to quadruple its 2000 GDP by 2020 means that it will require enormous
quantities of capital, the necessary labour power and huge volumes of raw materials, including energy resources, as well as intermediate products. Thus, objectively, Africa is strategically important to China as a source of raw materials, including oil and gas.The visualised GDP growth also means that the standard of living of millions of Chinese people will improve. Among other things, this says that these masses will demand and have the money to buy greater quantities of meat, fish, vegetables and fruit. Again objectively, Africa will increase in importance to China as a source of these non-mining but important primary products.

To pay for the import of all these products from Africa and others from the rest of the world, China will have to sustain its export drive. This means that Africa will continue to grow in significance as a market for China's industrial products and services, enabling her to obtain the foreign currency she needs to pay for her imports.

To summarise the foregoing, and to use a phrase well known to economists, other things being equal, this means that for no fault of the Chinese, the economic relationship between Africa and China would replicate the historic colonial economic relationship in terms of which Africa served as a source of raw materials and a market for goods manufactured in the countries of the colonisers.

The immensely important point however is that other things are not equal. What is not equal is the appreciation by the Chinese leadership and people that taking today's first step is as important as completing the journey of a thousand miles, many years hence. They know that the China-Africa partnership, which has material value both to China and Africa, has meaning only to the extent that it is durable and long lasting, based on mutual benefit.

The artefacts in the China National Museum and the entrance on Tiananmen Square to the Forbidden City constitute a daily reminder of the fact that, necessarily, protracted time separates today from tomorrow, and that merely to seek immediate gain today would be to put into jeopardy sustained benefit over the days that follow.

What is not equal is that the Chinese people and leadership understand that "the effort to achieve the common development of China and Africa", as President Hu Jintao put it, serves the fundamental interests of China. China understands that she can only prosper on a sustainable basis if Africa prospers on a sustainable basis. For this reason, the President of China reached into the rich store of the ancient wisdom of the Chinese people, and said, "'Bosom friends know no distance. Even living ten thousand miles away, they still feel close to each other like neighbours."

He said this fully cognisant of the reality that the relationship between bosom friends and good neighbours has meaning only to the extent that such bosom friends and neighbours can turn to each other and one another at the critical moments when they have to lend each other and one another a thimble of salt and a small bottle of soya sauce. Such need can only arise among similarly poor neighbours who share an obligation imposed by history and circumstance to seek mutually beneficial cooperation and build an equitable relationship of interdependence.

Other things are not equal because, despite today's and tomorrow's size of the Chinese economy, and as President Hu Jintao said, "In the modern era, our peoples launched unremitting and heroic struggle against subjugation, and have written a glorious chapter in the course of pursuing freedom and liberation, upholding human dignity, and striving for economic development and national rejuvenation." In this context, renascent Africa, whose leaders had signalled their intent by joining Chou En Lai at the historic Bandung Afro-Asian Conference in 1955, as fellow freedom fighters, fought that China should take her rightful place among the nations of the world, including the UN Security Council. Similarly, liberated China did what she needed to do to help ensure that Africa freed herself from the yoke of colonialism and apartheid.

Continuing this tradition, the Declaration of the Beijing Summit said: "In the new century, China and the African countries should enhance their traditional friendship and expand mutually beneficial cooperation, to achieve common development and cooperation." In this Declaration, China and Africa committed themselves "Properly (to) handle issues and challenges that may arise in the course of cooperation through friendly consultation in keeping with China-Africa friendship and the long-term interests of the two sides."

Further to give concrete expression to their cooperation, China and Africa adopted the sector-specific Beijing Action Plan (2007-2009), based on the shared imperative to "promote friendship, peace, cooperation and development", and to "advance the new type of strategic partnership between China and Africa in keeping with" the FOCAC Beijing Declaration. To advance these goals, President Hu Jintao informed the African leaders that even as she remained, still, a developing country, China would among other things, in the next three years:

When he announced this focused programme of support, President Hu Jintao also said: "China values its friendship with Africa. To strengthen unity and cooperation with Africa is a key principle guiding China's foreign policy. China will continue to support Africa in implementing the New Partnership for Africa's Development (NEPAD), and in its effort to strengthen itself through unity, achieve peace and stability and economic revitalisation in the region and raise its international standing. "Both China and Africa are cradles of human civilisation and lands of great promise. Common destiny and common goals have brought us together. China will remain a close friend, reliable partner and good brother of Africa. Let us join hands and endeavour to promote development in both China and Africa, improve the well-being of our peoples and build a harmonious world of enduring peace and common prosperity!"

At Tiananmen Square President Hu Jintao committed an ancient nation of 1.4 billion people, that is at work to achieve its own new renaissance, to support the New Partnership for Africa's Development (NEPAD) and African unity, and therefore our own efforts as Africans to break out of the suffocating condition of endemic poverty and underdevelopment. Because he leads and represents millions of people who are themselves continuing victims of poverty and underdevelopment, he understands that the innate impulse towards human solidarity, towards brotherhood and sisterhood among the poor, would never allow that China gets seduced to adhere to the advice - on my way to the top, may I never meet friends!

There are some in the world who fear this message of hope and the possibility it presents to define the process of Globalisation in a manner that benefits the poor of the world. They see the developments exemplified by the China-Africa Partnership as a threat to their selfish interests, as the blind adherents of the PW Botha of 1948, who was buried in George, South Africa, three days after the conclusion of the historic FOCAC Summit Meeting in Beijing, China, saw the birth of a non-racial and non- sexist democracy in our country as a threat to their selfish interests. The latter had convinced themselves that domestic apartheid in South Africa was a good thing both for them and us, in the same way as the former seem to have convinced themselves, even against their own long-term interests, that global apartheid is a good thing both for them and us, the wretched of the earth of Africa, the African Diaspora and the rest of the developing world. Twelve years after our liberation, the proven fact is that the freedom of the black oppressed in our country opened great vistas of opportunity, prosperity, global access and freedom from fear that our erstwhile white oppressors could never have imagined.

It is equally true that the prosperity of the billions of poor people across the globe, especially Africa and the South, Would open vistas of opportunity, prosperity, global access and freedom from fear for the rich North, that many from this part of the world find difficult to imagine and act upon, despite the benefit they have derived from the rapidly growing prosperity of the Chinese people ! Each of these, the domestic and the international Jeremiahs, within the context of their circumstances, will, with regard to the China-Africa partnership, do everything possible to project what is manifestly good as inherently evil, so that we, who have dire need of 'close friends, reliable partners and good brothers' become frightened of those who come to us genuinely extending a hand of friendship, partnership, brotherhood and sisterhood, as the Chinese people did at the beginning of November 2006 in the stately rooms of the Great Hall of the People on Tiananmen Square.

As happened with regard to our future as a winning nation, when, at the Union Buildings, Tshwane, in May 1994, the peoples of the world came together to celebrate the installation of Nelson Mandela as the first President of liberated South Africa, so did it happen that at Tiananmen Square, Beijing, in November 2006, Africa and China joined together to take the first step in a journey of hope that is as long as a thousand miles.

When we addressed the FOCAC Summit Meeting, moved to borrow words and images from the inspiring message immanent in the 2010 African FIFA Soccer World Cup that is yet to come, as the 2008 Beijing Olympic Games are yet to be, we said - we must adopt a dynamic approach to our strategic partnership, so that we all win in Africa, with Africa, and similarly win in China, with China.

Thabo Mbeki

2004 Was a record year for SA-Thai bilateral trade. Official trade figures released by the SA Department of Trade and Industry (DTI) indicate that bilateral trade between the two countries amounted to ZAR6,839,406,000 (approx US$1,068 billion).

Of this amount, SA exports to Thailand totalled ZAR2,577,869,000 (approx US$402 million) and SA imports from Thailand ZAR$4,261,537,000 (approx US$665 million).

Thailand was SA’s 24^th largest export destination and its 18^th largest source of imports in 2004. It also overtook both Malaysia and Singapore to become SA’s biggest trading partner in South East Asia. SA remains Thailand’s largest trading partner in Africa followed by Nigeria, Egypt, Morocco, Algeria and Senegal.

According to DTI, for the first three months of 2005, bilateral trade amounted to ZAR1,65 billion with SA exports to Thailand worth ZAR498 million and SA imports from Thailand worth ZAR1,15 billion.

While the range of products and commodities traded between the two countries are quite large and substantial, the biggest export items from SA to Thailand in 2004 were stainless steel, aluminium, semi-finished iron or non-alloy steel, chemical wood pulp, iron and steel bars and rods, fruit and nuts and flat-rolled steel products.

SA’s biggest import items in 2004 from Thailand were motor vehicle components, rice, automatic data processing machines, tinned fish, washing machines and motor cars.

For more detailed information, please feel free to have a look at the very comprehensive DTI Economic database website at http://www.dti.gov.za/econdb and follow the link to trade statistics.

Note: for this report, an average currency exchange rate of US$1,00 = ZAR6,40 was used.

JOHANNESBURG - A few years ago, the tiny kingdom of Lesotho appeared to have a lot on offer for investors: cheap labor, generous tax incentives and proximity to the regional powerhouse, South Africa. Textile manufacturers certainly seemed to like what they saw. Taiwanese entrepreneurs started arriving in Lesotho in 2000. By investing in the country, they were also able to take advantage of the African Growth and Opportunity Act (AGOA). This United States program was set up to allow duty-free access to the American market for a wide selection of exports from countries in sub-Saharan Africa that met certain conditions, such as respect for human rights and the rule of law.

After the Taiwanese came mainland Chinese, Mauritian and Malaysian textile firms. By 2003, Lesotho had grown into a major textile manufacturer in Africa, producing 31% of textiles exported to the US under AGOA. According to official statistics, some 50,000 people depended on Lesotho's textile industry for their livelihood in 2004, compared to 20,000 two years before.

During a four-day visit to Lesotho in December, the then US Trade Representative, Robert Zoellick, told journalists that his country had "a great respect for what Lesotho is accomplishing". But even as Zoellick was lavishing praise on the country's textile sector, its prospects looked grim. Toward the end of the year, six textile factories shut down - leaving 6,650 employees without work. Enraged union leader Billy Macaefa blamed the closures on the expiry of the Multi-Fiber Agreement (MFA), which was introduced by the World Trade Organization (WTO) about 30 years ago.

The initial aim of the MFA was to protect the textile industries of developed nations facing competition from low-cost producers in poorer states. Thanks to the MFA, nations were allowed to impose quotas on textile imports. This gave countries like Lesotho the proverbial "foot in the door" in markets that might otherwise have been dominated by manufacturing behemoths such as China.

But since the MFA's expiry on January 1, the budding textile industry of Lesotho and other countries in the region have been dealt a rude blow. Textile managers are now lobbying their governments to improve the business climate in the 13-nation Southern African Development Community (SADC). But when they say "improve the business climate", what they actually mean is, impel their governments to boost the competitiveness of the region's industry in the global textile market.

The removal of quota restrictions means that poor African producers are no longer protected from the stiff competition that the Asian mass producers pose. Asian countries are expected to enjoy unlimited access to the duty-free American market after the lifting of the quotas. A WTO study released in September showed that China and India would probably come to dominate about 80% of the global textile market in the post-MFA era, while the remaining 20% would be shared by the rest of the world.

Agrina Mussa, president of the Association of SADC Chambers of Commerce and Industry (ASCCI), said they had produced a "white paper" prescribing remedies to encourage domestic investment and production competitiveness. Following the lapse of the quotas, most Asian firms that had invested in the region to take advantage of the AGOA, have pulled out, Mussa said. "We need to look within (the SADC region) for investments which require that we have our own mills. For such investments to come, security, macroeconomic, good governance and labor issues need to be addressed."

The pullout of Asian investors has created thousands of job losses in the region. In a new report, "Rags to Riches to Rags", British-based charity Christian Aid estimates that 27 million workers around the world could lose their jobs as a result of the end of the quota system. Lesotho, Malawi and South Africa have already reported cuts in thousands of jobs in the textile industry.

In Malawi 2,511 jobs were cut between January and March this year when a Taiwanese firm, Haps Garments, closed shop in the administrative capital of Lilongwe and relocated to Taipei. A branch of Haps in Lesotho - where more than 10,000 textile workers have been rendered jobless - also closed in 2004. Malawi has registered nine textile companies under AGOA, but not all of them are exporting to the US. Between them, they employ more than 11,000 workers, who now face an uncertain future.

In the tiny kingdom of Swaziland, where AGOA products constituted 83% of the country's exports, 30,000 jobs are at stake, according to a March 2005 survey conducted by the Zambia-based Common Market for Eastern and Southern Africa (COMESA). "Any potential disruption to the local textiles and garments industry would be understandably resented as this would present enormous social problems [for] the country," said the survey.

In 2004, Malawi earned about US$20 million in textile exports from the US market, according to a January 2005 country report on Malawi by London-based think-tank Economist Intelligence Unit (EIU). The report says the country's exports under AGOA jumped by 40% and that it emerged the third-highest African exporter to the US after South Africa and Cote d'Ivoire.

In regional giant South Africa, some 300,000 textile workers have lost their jobs in the past two years due to the influx of Chinese goods. "We need some sort of quota placed on China. It will be a short-term solution, but it will give the textile industry a breathing space to reorganize itself," said Walter Simeoni, president of the South African Textile Federation. "Chinese clothing now represents 86% of the total garments imported into South Africa. Items like towels, blankets and curtains represent 60%. All this was achieved within the past three years."

Simeoni rejects the argument that slapping quotas on Chinese textile imports would violate WTO rules. "Brazil, Turkey and the US have introduced some quotas on some of their products. The European Union is also looking at it. I think the South African authorities have not been convinced of the urgency of the problem. And, I think they are reluctant to upset the Chinese." This, says Simeoni, stems from the fact that China supported the struggle to end apartheid in South Africa.

Currency fluctuations have worsened the crisis in the textile industry. In recent months, the South African rand has strengthened from the historic low it reached in December 2001, when $1 traded for 13.85 rand. The dollar is now around six rands. "No textile firm in the world can compete in an environment where the currency appreciated against the US dollar and the Chinese currency by 30% in 2002 and a further 25% between January 2003 and October 2003," said Simeoni. "In fact, all our competitors in the East depreciated their currency...against the rand, as they linked themselves to the US dollar in order to stay competitive. This is one of the reasons they create jobs, while we destroy them." An exchange rate of nine rand to the dollar is apparently needed for South African textile exports to regain their competitive edge.

Manufacturers also complain that labor costs in the country are pricing them out of the market. Simeoni claimed that monthly salaries for the industry have increased from an average of about $215 per month in January 2002 to $500 in September 2004. South Africa's competitors in the Far East, he said, pay $40-100 per month.

Concerned that the end of MFA could hurt poor African producers benefiting from AGOA, the US government has since October 2004 instituted safeguard measures to contain specific Chinese textiles and apparels. According to the US government's Committee for the Implementation of Textile Agreements (CITA), the measures aim at limiting disruptions that Chinese exports may cause to the US market, if such distortions can be identified. Under these measures, cotton knit shirts and blouses, cotton trousers, socks, and man-made fiber underwear would be reviewed and put under quotas if they are found to cause market distortions. The US is permitted, under the provisions of China's WTO Accession Agreement, to apply safeguards on textile products from China in instances where those criteria are met

The 15^th Annual Asian corporate conference will be held between the 8^th – 10^th June at the Shangri-La hotel in Bangkok Thailand.

Thailand remains one of the fastest growing economies in Asia, and its economic surge reflects broader positive developments across Southeast Asia. The 15th Asian Corporate Conference will take the pulse of Southeast Asia and envision just how big a player the region will be in the global economy in the coming years. How will new bilateral and multilateral trade agreements with Southeast Asian countries alter the balance of trade in the region and in the world? As ASEAN nations become powerful trade partners in Asia, how will the roles of the U.S., India, and China in the region evolve? What are the implications for new investment in the region? Since 1989, the Asian Corporate Conference has attracted a combined audience of more than 12,000 participants from more than 26 countries.

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