SIAKA MOMOH
The Obasanjo Administration (1999-2007) came with increase in the tempo of Nigeria-China relationship. This is understandable since Nigeria had just freed itself from the status of a pariah state which Nigeria’s burdensome military dictatorship forced on it.
Nigeria is doing so much with China today in terms of trade and investments.
But how beneficial is this relationship with China ? Are we learning the ropes from China? Are we leveraging China’s experience? Are we leveraging on its strategies which saw the Chinese out of poverty? Is the Nigeria-China relationship not akin to that with the West? In spite of its South-South nature, is it not similar to the North-South relationship which we have been involved in since the colonial days? Is there any strategic blueprint in place to make China transfer its technology to us?
Background
China, like India, is an emerging economy. The beauty that the Chinese economy is now, its economic progress that many developing countries now admire, began in 1978 after Chinese leaders, led by Deng Xiaoping, concluded that the Soviet style system that had been in place since the 1950s was making little progress in improving the standard of living of the Chinese people and also failing to close the economic gap between China and the industrialised nations.
China has undergone a series of phased reforms, reforms that were designed to solve problems in the Chinese economy. The reforms have taken China from the 1970s through the 1990s to date. It has been quite an experience that, no doubt, has yielded robust results.
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The standard of living of most Chinese has improved remarkably, what with rapid modernization of infrastructure, a poverty rate that dropped from 53 per cent of the population in 1981 to 8 per cent in 2001. As of 2005, 70 per cent of GDP has been in the private sector and the relatively small public sector is domiciled by about 200 large state enterprises concentrating mostly in utilities, heavy industries, and energy resources.
Though Sino-African relations date back to centuries, Nigeria’s contact with China, unofficially, only began in the 1950s, 1957 to be precise. Chinese relations with Africa were essentially with North Africa. In fact, Nigeria’s contact with the Chinese was through Egypt. It is on record that Chan Hiang-Kang, commercial officer in the Chinese Embassy in Cairo, established unofficial trade links with Nigeria, along with Ghana, Ethiopia, Tanganyika (now Tanzania) in 1957.
It was a taboo for Nigerians to have anything to do with the communist world which China belonged to. Nigerians like Funmilayo Ransome-Kuti, a frontline Nigerian political and social activist, much to the chagrin of the colonial authorities, secretly visited Berlin and Beijing in the 1950s to attend meetings. Her application for the renewal of her passport was turned down. All contacts with the Eastern bloc countries and China were prohibited and proscribed. All Nigerian students who obtained benevolent scholarships from undisclosed sources and Nigerian trade union leaders who attended international conferences in those countries had to be smuggled out of Nigeria through Ghana.
But this position was reversed in 1958 by the Nigeria Prime Minister, Tafawa Balewa in a policy statement in parliament which states in part:
“We shall, of course endeavour to remain in friendly terms with every nation which promises and respects our sovereignty…
Nigeria’s untainted support for the discussion of the subject of admission of Red China into the United Nations and our bold retort when the West questioned our action is a case that cannot be glossed over. Nigeria’s Jaja Wachukwu said their reaction was nothing short of intellectual imperialism.
In 1971, Nigeria/China mutually friendly disposition blossomed into the establishment of relations at ambassadorial level. Thus a mutually and reinforcing and rewarding relationship between both countries began in earnest.
Political relations
As third world countries, Nigeria and China see their relationship as mutually reinforcing. They speak with the same voice at the United Nations and its specialised agencies and they are great advocates of South-South cooperation as a means of achieving a new international economic order which has so far remained unattainable.
Whilst China respects and admires Nigeria’s non-aligned foreign policy application, Nigeria remains a staunch supporter of One China policy, that the Republic of China ( Taiwan ) is an inalienable part of China , and that the Government of the People’s Republic of China is the only legitimate Government of China. Nigeria regards Hong Kong as a trading post; it fully supported the return of Hong Kong to the People’s Republic of China in July 1997.
Economic relations
Fang Yi, former Chinese Minister of Foreign Trade and Economic Cooperation, visited Nigeria in 1972, a visit that provided an opportunity for signing the first economic, scientific and technical cooperation agreement as well as a trade agreement. There were several other visits to Nigeria , including that of a team of Chinese engineers from China Civil Engineering Construction Corporation (CCECC) in 1996 for on the spot assessment of the Nigeria Railway Project. This is aside from relations that had to do with agriculture “irrigated rice plantations in Itoikin, Lagos , water resources in Borno State and Nigeria National Electricity Power Authority (NEPA), now Power Holding Company of Nigeria (PHCN), in the 1990s.
The Chinese also had something to do with troubled Ajaokuta Steel project and Delta Steel project Aladja “Chinese experts inspected these projects and the enabling agreement was signed. On May 12, 1997 during the visit of Li Peng, former Premier of the state Council but the project was plunged in the mire by alleged corruption scam in which late Sani Abacha, some of his family members, Anthony Ani, former Minister of Finance and Bashir Dalhatu, former Power and Steel Minister, were involved.
Discussion between Nigeria and China on the rehabilitation of the Nigerian Railways commenced during the Murtala Muhammed/Obasanjo regime of 1975-1979 when deliberate efforts were made to deepen relations between Nigeria and China . The Chinese side was enthusiastic to complete the job having just completed the TANZAM Railway project in East Africa . But subsequent discussions failed because of the alleged greed and corruption practices of some Nigeria leaders who wanted kick-backs the Chinese would not give.
That the Nigerian railways suffered over three decades of neglect is now history. It was against this background that the Abacha regime came in with CCECC. The contract for the project was signed December 9, 1995 with a price tag of US$528.60 million. The contract was for rehabilitation which involved supply of coaches, locomotives, wagons and guard vans, as well as restructuring of rail lines. Unfortunately, the job was not completed on target date because Nigerian contractors did not supply track materials within the stipulated period. The indication though was that over 80 per cent of the job had been completed by September 1998. But the government statement did not say whether this additional task would be undertaken by CCECC.
Information, culture, youths and sports
Relations in respect of information took some time to have a foothold because the Chinese Government, steeped in its revered communist tradition, did not think it necessary to establish a ministry of information as it is found in Nigeria and other parts of the world. Theirs was, and still is, propaganda galore. The Xinhua (New China) News Agency, founded in 1937, started it all and has now been joined by a robust network of television stations and China Radio International. Xinhua News Agency has its African headquarters in Nairobi Kenya , a bureau in Lagos and China Radio International broadcast latest developments in China to the world.
The 1980s witnessed a litany of cultural exchanges such as the Anhui Acrobatic Troupe from China which Nigeria hosted in early 1980, the Nigerian Basket Ball team which undertook a two-week tour of China as answer to the acrobatic troupe challenge, so to speak, and a series of Chinese acrobatic troupes performances at the National Theatre, Lagos in 1983 and 1985.
Regarding sports, it would be recalled that China was instrumental to the development of table tennis (ping pong), volley and badminton in Nigeria either through the attachment of appropriate coaches to the National Sports Council or conducting relevant courses for Nigerian sports men and women in China.
Thus Nigeria-China relations have come a long way. It dates back to the 1950s and was formalised in 1971.
Trade and investments
According to World Bank Weekly Report for July 7, 2008, Sino-African trade has exploded from $2 billion in 1999 to $55.5 billion in 2006 and $73 billion in 2007, growing faster than Chinese trade with the rest of the world, and making a significant contribution to China’s success.
Nigeria comes in big as that part of Africa that the Chinese are interested in. For instance, China’s recent business activities in Nigeria increased to an all-time high figure of $2.83 (N370 billion) in 2005 trade. It is believed in diplomatic circles that the increasing tempo of China’s activities is meant to consolidate her hold on Nigeria as Africa’s most important trading partner south of the Sahara. Hu Jintao, Chinese president, visited Abuja in April 2006 in reciprocity to Nigeria’s Olusegun Obasanjo’;s visit to Beijing in 2005. Several economic agreements were signed and a cooperative framework developed for the realization of greater relations. It would be recalled that by mid 2002, Nigeria and China signed four agreements in Beijing when the then vice-president, Atiku Abubakar, paid a six-day official visit to China. The agreements include that on consulate matters, cooperation against illicit trafficking and abuse of narcotic drugs, psychotropic substances and the diversion of precursor chemicals. Others were on exchange of notes on provision of goods between the two countries and agreement on tourism cooperation.
On January 9, 2006, an inter-ministerial Federal government Delegation visited China to negotiate a $2.6-billion for the rehabilitation, bilateral loan meant for rehabilitation, reconstruction and development of the ailing Nigeria Railways Corporation (NRC). This NRC’s job is currently steeped in controversy.
The Chinese have invested heavily in the Nigerian oil sector. In January 2006, China’s national offshore oil company acquired a $2.3 billion majority stake in a major oil field. And while conferring with Olu Adeniji, foreign minister during the Obasanjo Administration early 2006, the Chinese foreign minister, Li Zhaoxing, announced that the new set of economic and technical agreements between Nigeria and China had started yielding results. The Chinese government then released $3.65 million (N600million) grant to Nigeria .
President Jintao’s comments on his country’s relationship with Nigeria give you a rosy picture of the relationship. Jintao, who came to Nigeria with a 40-man delegation, said China is now desirous more than before to deepen and develop a new strategic partnership with Nigeria. He spoke about cooperation in the area of satellite which he said has achieved obvious progress (in fact China has launched the Nigerian satellite it helped build to space).
China has concluded arrangement to build a vehicle assembly plant in Lagos. A site close to the Lagos International Trade Fair Complex has been chosen for the plant.
Nigeria’s relations with China in the areas of agriculture, telecommunications, electricity and general infrastructure has expanded in leaps and bounds, according to Chinese Foreign Minister while speaking to a group of journalists in April 2006. He said the joint efforts of both sides in bilateral relations have maintained the good momentum of anticipated growth, encouraged by high level visits and enhanced mutual political trust and that the strategic partnership has even now pushed up an unprecedented level of cooperation between Nigeria and China in international affairs.
Chinese firms are trooping into the country to do business. In April 2005, ZTE Corporation, A Chinese firm, entered a deal with NITEL to expand Nigeria’s CDMA network following a successful 10,000 line trial in Maiduguri .
Borno State . The project is meant to provide local telecom components and other ancillary services. The Chinese Civil Engineering and Construction Company (CCECC) built the Nigerian Communications Commission building in Abuja and Huawei, a giant Chinese telecom company has started doing business in Nigeria with offices in Lagos and Abuja. A good number of young Nigerian graduates of tertiary institutions have been employed by Huawei. One only hopes the telecom technology is being passed on to them.
And China is the source of the hordes of Okada (motor-cycles) that line Nigerian roads. Shao Huixiang, Deputy Director-General of Shanghai municipality, where many of the motor-cycles come from, confirmed the increase in transactions between China and Nigeria. He noted that the back up trade destination between Shanghai alone and Nigeria amounted to about $172 million, 10.3 per cent higher when compared to the previous year.
The last five years have witnessed some major Chinese investments. They include the following: China National Overseas Oil Company Limited (CNOOC), 45 per cent stake in OPL 246 worth $2.7 billion in offshore deepwater oil field operated by Total – the French oil giant. This is reported as the CNOOC’s largest foreign investment ever. CNOOC will pay $424 million for financing, operating and capital expenses. Profits will be shared with Nigerian National Petroleum Corporation in a ratio 70:30 in favour of CNOOC. In addition CNOOC will refund $600 million already spent to Total. Oil production is expected to commence in 2008 reaching a peak of 225,000barrels a day.
Sinopec also has a three-year contract to develop OML64 and OML 66 jointly with NNPC subsidiary NPDC.
The Borno state government awarded six major contracts to Chinese construction and engineering firms to stem the wave of flooding, drainage construction to also curtail mosquito infestation, construction an all year round water channel called water fall out. The two Chinese firms’ China is Geo Engineering Corporation (GEC) and ECC and a Nigerian Construction firm, Sky Technical. The construction package is N6.5 billion.
Chinese Civil Engineering Construction Corporation (CCECC) has been awarded the contract for the modernization of the Nigeria’s one-track rail line to standard gauge rail project. The project’s first phase is worth $8.3 billion, China has loaned the Nigerian government $2.5 billion to finance refurbishment of the railway system. The railway is estimated to be 7,800 km in distance, and it will connect all the 36 states and major cities of Nigeria . This contract was signed between Nigeria and CCECC on Oct. 30, 2006. This railway contract is currently embroiled in controversy.
In year 2006, the China Development Bank (CDB) gave a $20 million financial support to Reliance Telecommunications Ltd. (RelTel) to assist the Company. In its bid to position RelTel wireless as the biggest fixed wireless company in Nigeria . Huawei Technologies, a Chinese major telecommunications giant was the facilitator of this facility by CDB.
A Chinese conglomerate, Zhuhai Minghong Group Corporation Limited surveyed the 350 acres moribund Awoomama Resort in Oru East Local Council of Imo State, agreed it would revive the resort.
While the president of the Guangdong Chamber of Commerce noted that the resort bordered between two commercial cities of Aba in Abia State and Onitsha in Anambra State , as well as yet to be realized Oguta inland port would promote effective patronage and provide job opportunities for Nigeria ’s teeming unemployed youths.
A state owned company, Genetic International Corporation of China (GICC) bought its first consignment of 100,000 metric tones of fresh cassava chips from Nigeria in July 2005. It was agreed this deal will continue over a period of six months on monthly basis. GICC expressed readiness to import cocoa beans and rubber directly from Nigeria .
China has increased its volume of agricultural export from Nigeria . Nigeria has shipped 80,000 tonnes of cassava chips to China and thereafter received an order to supply another 102,000 tonnes. China is also buying sesame seeds from Nigeria . There are currently over 500 Chinese experts and technicians in various fields of agriculture in 20 states of the Federation. They are working with Nigeria agriculturists and farmers involved in the construction of small dams.
$2.5 Billion Hydropower plant for Adamawa, to be constructed by the Chinese. Huawei $250m equipment agreement with GV Telecoms/Prestel
Nigeria shipped its ever-first consignment of fresh cassava chips to China in 2004.
Twenty Chinese companies participated in the 2007 Lagos International Trade Fair. Participation of Chinese companies in this most important international trade fair is an annual ritual.
Busty Okundaye, a Nigerian engineer with very strong links with China (he is married to a Chinese), gave a broad overview of Nigeria-China relations in an article titled ‘A template for Westward expansion’ in Business Day. He argued that between 2000 and 2003, the number of Chinese funded enterprises grew from 499 to 638, spread across 54 African countries and regions. According to him, Nigeria is now China’s second largest export market and third largest trade partner in Africa, after South Africa and Egypt . He mentioned in particular Huawei Technologies, China’s largest telecommunication equipment manufacturer which signed a deal to provide Nigeria USD$200 million worth of telecommunication equipment to set up a nationwide mobile phone service using CDMA technology.
Okundaye did not leave out the Nigerian communications satellite bid launched May 2007, the first Chinese satellite bought by any African country. The satellite is called Dongfanghong IV.
Put in a nut shell, the volume of trade between Nigeria and China increased from US$178 million in 1996 to US$1.44 billion in December 2001. The trade figure for 2002 was US$1.168 billion and it rose to US$1.858 billion in 2003. In 2004 the figure rose to US2 billion and stood at US$2.83 billion in 2007. China is one of Nigeria’s top ten trading partners and it has set up 30 companies (some solely owned, some jointly owned with Nigerians) in Nigeria . These companies are involved in construction, oil and gas, technology, service and education sectors of the Nigerian economy. China has signed oil exploration contracts worth over N4 billion and its involvement in the oil sector is tied to its building a power generating station that would add substantial megawatts of electricity to Nigeria’s power sector.
Nigeria approved the purchase of 15 F-7N1 and Ft-7N1 Chinese multi-role combat/trainer aircrafts to boost the defence operations of her Nigerian armed forces in September 2003.
