China-Africa Forum To Address Sustainability, Beijing firms agree to code of conduct

[Some news highlights from FOCAC relating to corporate social
responsibility]

Beijing firms agree to code of conduct

22 July 2012
Weekend Argus

China responds to African complaints

Beijing-Chinese entrepreneurs doing business with Africa have committed
to a Declaration of Social Responsibility to guide their conduct on the
continent.

The code of conduct was agreed to at a meeting here of entrepreneurs
from China and more than 50 African countries on the sidelines of the
Forum for China Africa Co-operation (FOCAC), the main framework for
China-Africa relations.

The declaration seemed designed to address reports of various complaints
about Chinese companies in Africa, ranging from abuse of workers,
through dumping poor quality goods on the continent, to focusing too
much on extracting raw materials and not adding value to them before export.

Yu Ping, the vice-chairperson of the China Council for the Promotion of
International Trade told journalists that the Declaration of Social
Responsibility was one of the main outcomes of the entrepreneurs conference.

He said the declaration called upon Chinese entrepreneurs to consolidate
a new type of relations with Africa, based on the principles of equality
and the long-term development of Africa.

They had agreed to respect African customs, improve the quality of their
products sold in Africa, add value to their products, make greater use
of local inputs, upgrade local industry, transfer technology to locals
and provide social services such as medical care.

In general, the declaration committed the Chinese companies to follow
the guidelines of FOCAC, which completed a two-day meeting at
ministerial level on Friday, and the declaration would be implemented
under the guidance of the Chinese government, Yu said.

At the opening of the ministerial on Thursday, Chinese President Hu
Jintao had committed China to greater support for Africa's economic
objectives, including adding value to products and boosting cross-border
infrastucture to promote regional integration.

Yu was asked why the Chinese companies had decided to establish a
Declaration of Social Responsibility, would it be compulsory and would
there be any sanctions for companies which flouted it.

He said in general corporate responsibility "was a matter of ethics
rather than law so the best way to strengthen social responsibility is
through education and guidance".

Yu alluded to reports that some African workers and customers had
complained of abuse by Chinese business managers, and of poor Chinese
products. He said much of the Western reporting about abuses by Chinese
companies in Africa was misleading and that Chinese companies were
generally doing well in Africa.

The government was encouraging them to be more active in explaining the
good work they did.

China-Africa Forum To Address Sustainability, Trade Balance
By Wayne Ma

18 July 2012
Dow Jones International News


BEIJING--The fifth Forum on China-Africa Cooperation starting Thursday
will likely address the environmental sustainability of China's
extraction of commodities in Africa, but some experts are skeptical
Beijing can follow through with commitments.

Africa has provided huge opportunities for Chinese companies, especially
those involved in energy. Sinohydro Corp., which built most of China's
Three Gorges Dam, has capitalized on the continent's vast hydropower
resources by developing projects in 21 African countries. Big companies
such as China Petrochemical Corp. and China National Petroleum Corp.
have major oil and gas investments in Angola, Sudan and Libya, all of
which are important exporters of crude oil to China.

"China's central government is very limited in what it can do to control
the huge proportion of Chinese activity in Africa," said Ian Taylor, a
professor at the University of St. Andrews. "A lot of Chinese
corporations don't take into account environmental sustainability in
China itself--why should they be any different in Africa?" Mr. Taylor asked.

Trade is also an growing issue. China's main imports from Africa include
crude oil, copper, coal and iron-ore products, while Africa is a large
buyer of products such as machinery and textiles.

"This trend in Sino-African trade benefits China, which enters African
markets to sell its manufactured goods and buys primary products with
little added value for Africa," according to Daouda Cisse, a researcher
at the Center for Chinese Studies at Stellenbosch University, in a note.
"With the rising purchasing power among Chinese and a shift towards
consumer-driven growth in China, opportunities are presented to move
towards a more balanced trade between China and Africa," he said.

African leaders appear optimistic about the upcoming meeting, according
to the state-run Xinhua news agency.

Niger's President Mahamadou Issoufou said his country expects China to
help boost agricultural production, while Sindiso Ngwenya,
secretary-general of the Common Market for Eastern and Southern Africa,
or Comesa, said he has "great expectations" for the forum, which will
address Africa's infrastructure and energy sectors, Xinhua reported.

FOCAC, as the forum is known, has been held every three years since
2000, has resulted in the removal of numerous trade barriers and Chinese
pledges to provide billions in loans, debt cancellation and
infrastructure projects for African countries.

Since the first meeting, China's trade with Africa has risen 16-fold to
$166.3 billion, according to China's Ministry of Foreign Affairs.

With China's economy slowing and a government effort to steer away from
energy-intensive industries, Beijing may need to adjust its strategy
this time around.

"2006 was the high point so far, when the Chinese really did go
overboard on their pledges and promises," Mr. Taylor said. "Since then,
the Chinese have been making statements trying to rein in expectations
of African heads of state ... they don't want to be seen as the next
Santa Claus."
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