Chinese Enterprises Open The Road Of Win-Win Cooperation In Africa

Since the "Belt and Road" initiative was put forward ten years ago, Africa has become one of the most important directions for cooperation in the initiative, and has almost achieved full coverage of the "Belt and Road" cooperation. In recent years, under the framework of the Forum on China Africa Cooperation, China's cooperation with Africa has been deepening and achieved fruitful results. China has become Africa's largest trading partner for 15 consecutive years. In 2023, China Africa trade volume will reach 282.1 billion US dollars, a record high. China is also a developing country with the largest scale of investment in Africa. By the end of 2022, China's stock of direct investment in Africa has exceeded 47 billion US dollars. More than 3000 Chinese enterprises have invested and started businesses in Africa, creating a large number of local jobs, helping the transformation and upgrading of Africa's industrial chain, and opening up a win-win path for cooperation with Africa.

The Chinese textile and clothing entrepreneur delegation, jointly organized by the Textile Industry Branch of the China Council for the Promotion of International Trade and the China Knitting Industry Association, will enter East Africa - Tanzania and Kenya on October 23-30, 2024 to conduct in-depth research on the investment environment and potential of the textile and clothing industries in both countries and deepen the cooperation between China and Africa's textile and clothing industries. The delegation was led by Lin Yunfeng, President of China Knitting Industry Association, Zhu Beina, Chairman of China Cotton Textile Industry Association, Liu Tiantao, Deputy Secretary General of China Printing and Dyeing Industry Association, Shanghai Jialinjie Textile Technology Co., Ltd., Tangshan Shengxu Textile Co., Ltd., Nantong Xiangyuan Textile Co., Ltd., Ningbo Hailide Import and Export Co., Ltd., Haining Hande Socks Industry Co., Ltd Guangzhou Tianliyuan Garment Trade Co., Ltd. and other entrepreneurs and executives were followed up.

work conference

　　 The delegation had a discussion with Counsellor Chu Kun of the Chinese Business Office in Tanzania. Counsellor Chu made a comprehensive analysis of Tanzania's investment environment, pointed out the country's advantages and challenges, and provided enterprises with risk factors and political background that should be considered when considering investment decisions. Tanzania is an agricultural country. Since the founding of the People's Republic of China, the ruling party has been in power for a long time, which is relatively safe and stable, with a harmonious society, strong government governance ability, good debt control, and stable currency. The economy has been on the upward trend. Speaking of the advantages of investing in Tanzania, Chu Zanzan believed that the two countries have good cooperation foundation and potential cooperation opportunities in agricultural and textile cooperation. For example, Tanzania is the world's second largest sisal production place, and domestic enterprises have invested in sisal cultivation in the north. In addition, although Tanzania implements foreign exchange control, its policies are relatively loose, Foreign exchange can be freely convertible. Chu Zan hoped that Chinese entrepreneurs would have enough patience to adapt to the local environment, actively participate in the socio-economic development and construction of Tanzania, and jointly face potential challenges including trade union activities, uncertainty of investment policies and tax review.

Visit Tanzania Export Processing Zone Authority

The first stop of the delegation in Tanzania came to the Tanzania Export Processing Zone Authority (EPZA). Chairman Lin introduced at the meeting that the members of the delegation were from China Knitting Industry Association, China Cotton Textile Industry Association, China Printing and Dyeing Industry Association, China Council for the Promotion of Textile Trade, as well as outstanding entrepreneurs from all over the country in the textile and clothing industry chain, involving all aspects of the textile and clothing industry, such as textile, weaving, printing and dyeing, clothing import and export trade, and the member enterprises were also in Southeast Asia South Asia, Central Asia, Africa and other countries have rich practical experience in overseas investment and hope to find new investment opportunities through this visit to Tanzania.

Mr. James M. Maziku, General Manager of the Investment Promotion and Facilitation Department of the Authority, introduced the functions and investment opportunities of the Authority in detail. Tanzania has provided diversified investment channels for potential investors, including but not limited to investment in special economic zones and export processing zones, application for investment through Tanzania Investment Promotion Center or Zanzibar Investment Bureau, and investment in mining, oil and gas and public private partnership projects. It is worth noting that both the special economic zones and the export processing zones have incentive policies to attract investors, such as 10 years of corporate tax relief and raw material import tax exemption and other preferential conditions.

Visit Tanzania Investment Promotion Center

Tanzania Investment Promotion Center (TIC) is subordinate to the Ministry of Industry and Trade. It is the main agency for the government to coordinate, encourage and promote investment in Tanzania and provide one-stop convenience service measures. Tanzania has become an attractive investment destination with its political stability, sustained economic growth, low inflation rate, rich natural resources and strategic geographical location. Mr. Daudi Riganda, manager of the Investment Promotion Department, mentioned that Tanzania has a stable cotton supply and is also a large producer of organic cotton, which is a huge advantage for the textile industry. In addition, Tanzania has signed a number of market access agreements, including the Free Trade Agreement (FTA), the East African Community (EAC), the Southern African Development Community (SADC), the African Continent Free Trade Area (AfCTA), the African Growth and Planning Act (AGOA), and the EU's tax exemption for all products except weapons and ammunition (EBA), which can effectively radiate to East Africa (288 million people) Even the Southern African market (327 million people). He also said that the government has provided multi-dimensional efforts and practices in improving infrastructure, attracting foreign investment and enhancing national competitiveness. According to the different investment amount, it is divided into three types of investors. Investors with an investment amount of more than 300 million dollars are given the privilege to negotiate with the government. The State Investment Service Commission led by the Prime Minister is responsible for project docking.

President Lin pointed out at the meeting that China has the largest and most complete textile and clothing industry chain in the world, and industrial enterprises have actively sought overseas investment opportunities in recent years, focusing on Southeast Asia, South Asia, Central Asia and Africa. With the rising costs in Southeast Asia in recent years, more and more Chinese investors are focusing on Africa. Tanzania has natural ports, convenient transportation and high-quality organic cotton, which is a great advantage for the development of the textile industry.

Investigate China Tanzania Industrial Park

The Sino Tanzania Industrial Park, jointly developed by China Tanker Baha Industrial Park Co., Ltd. and Shengfei Industrial Park, is the first national industrial park in Tanzania and has received great attention and support from the Tanzanian government. The project is about 80km away from the port city of Dar es Salaam and covers an area of 1000 hectares. It connects six landlocked countries in central and western China and East Africa with the Central Standard Gauge Railway and the Kara Land Port. The project is developed in five phases. The park includes living facilities area, agricultural and food processing area, medicine and daily chemicals area, shoes and clothing processing area, equipment manufacturing area, building materials processing area and export processing area. At the same time, the park is equipped with independent substation, water supply plant, government one-stop service center, park management center, bus station, fire station, gas station, commercial center, police station, church There are a series of service facilities including mosques, and currently there are more than 30 enterprises in the park.

Chen Xiong, the Chinese general manager of the park, introduced the land price of the industrial park, preferential tax policies for entering the park, industrial costs, staff salaries and other information in detail. Mr. Nivedh Shetty, the general manager of the Tanzania Marketing Department of Shengfei Industrial Park, said that Shengfei has industrial park projects in 12 African countries at present, of which Benin and Togo parks are quite large and have settled in many textile enterprises. Because Tanzania has the advantage of natural cotton planting, the Group plans to copy the Benin model and set up a textile and clothing processing zone in Tanzania Park to attract upstream and downstream industries and supporting industries to settle in the park. At that time, cotton in the west will be directly transported to the park through the central standard gauge railway, and import and export goods can also be directly cleared at the land port, It brings great convenience to enterprises in the park. The park is equipped with vocational schools, which can help enterprises in the park to recruit and train employees.

The members of the delegation had a heated discussion with the representatives of the Industrial Park on water resource treatment and application, electricity, natural gas, land price, logistics, preferential tax policies and other issues, and then conducted field research on two enterprises in the Park.

Enterprise research

Changzhou Dong'ao Garment Factory

In 2012, with the rise of domestic labor costs and the increasingly complex international trade environment, Changzhou Dong'ao Garment Factory set up a factory in the Benjamin William Makapa Export Processing Zone in Tanzania, about 15 kilometers away from the economic capital Dar es Salaam. At present, it has seven garment factories, providing more than 7000 jobs in the local area, and has become the largest garment processing enterprise in Tanzania. The company's products are mainly jeans, which are exported to the U.S. market duty-free under the AGOA policy. Its customers include LEVIS, WRANGLER, PRIMARK, etc. The electricity cost is 3 cents per kilowatt hour, and the basic wage of workers is 80 dollars per month.

Nantong Home Textile Factory

The delegation also visited a Nantong home textile enterprise in the park, and saw local workers skillfully sorting out the finished quilt covers. According to the Chinese person in charge of the company, the fabrics were all imported from China and simply processed locally. Home textile products were loved by local people and sold well in the market, Another workshop has been rented and production expansion is planned.

Summary

Through intensive research in Tanzania these days, members of the delegation said that although the development of infrastructure and textile industry in the country is at the initial stage, there is great potential for subsequent development. Rich organic cotton resources and competitive electricity price advantages are very suitable for the development of labor-intensive industries, especially export-oriented enterprises. The visit not only deepened the understanding and mutual trust between China and Tanzania in the field of textile and clothing, but also laid a solid foundation for future cooperation to achieve mutual benefit and win-win results.

(Source: China Textile International Capacity Cooperation Enterprise Alliance)