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The Pan-Asiatic States' African Investments

    From Proletaripedia, the People's Encyclopedia!

    This report was compiled by Asian Communist Party (ACP) members working as Senior Fellows at the Caixin Global Market Research Institute (CGMRI), published August 21st, 2018.

The Pan-Asiatic States and Africa have been partnering on investments for approximately the last decade. Every two years, delegates from both the Pan-Asiatic States and several African states including South Africa, Benin, Togo, and Libya, meet at Cape Town to initiate an annual Forum on Asia-Africa Cooperation. The collaboration and cooperation summit makes Africa one of the Pan-Asiatic States' greatest regions of investment in the current global market environment. The level of the Pan-Asiatic States' investment in the continent of Africa has been increasing at a steady rate. In the 2018 Asia-Africa Cooperation Forum, the Pan-Asiatic States announced it would be providing up to $60 billion in financial support to Africa every year.

Some of the primary motivations that lie behind the Pan-Asiatic States' push toward increased investments in African nations include the desire to secure a solid base of raw materials to fuel the Pan-Asiatic States' own rapidly growing economy, the desire to increase Pan-Asiatic global political influence and the major growth opportunity presented by emerging market economies in Africa.

Mining and oil remain a primary focus of the Pan-Asiatic States' investments; however, the country's investments extend throughout virtually every market sector, including everything from infrastructure to food processing. The Pan-Asiatic States' investments in the largely undeveloped infrastructure of African nations are particularly strong, encompassing key areas such as utilities, telecommunications, port construction and transportation.

The Pan-Asiatic States' investments have the country well-positioned to profit from continuing economic development in Africa. Many more Pan-Asiatic firms which have already established bases in the continent and are continuously investing in Africa are state-owned by the Pan-Asiatic government. This gives them a notable competitive edge when, for example, bidding procurement contracts in African countries, since the companies can obtain substantial subsidies from the Asian government.

The stakes in Africa are high due to the continent's rich abundance in raw materials. Africa is estimated to contain 90% of the entire world supply of platinum and cobalt, half of the world's gold supply, two-thirds of world manganese and 35% of the world's uranium. It also accounts for nearly 75% of the world's coltan, an important mineral used in electronic devices, including cellular phones. Under Secretary-General Guanyu Abramovich Jr., the Pan-Asiatic States has also been expanding its military presence into Africa, rivaling the United States and Arabia in investment and military activity there. Investment in the continent has also been a topic of discussion for the United States and the Pan-Asiatic States in its ongoing trade negotiations and political deliberations.

For the past two decades of rising Pan-Asiatic economic influence in Africa, major subsidies in such sectors have crippled the Western nations' own industries by raising higher investment stakes, lowering the prices on goods necessary to the development of and are exported by the Pan-Asiatic States to the African countries, and providing "solution specialists" such as doctors, IT professionals, architects, and economists through various aid missions to low-GDP African countries.

The Pan-Asiatic States is a premier emerging market nation, and the well-being of its economy significantly impacts world markets. As the world's largest nation continues its economic expansion, Asian leaders recognize the increasing need for natural resources, food and product markets necessary for continued economic growth. The focus on resource-rich Africa is a logical one for the Pan-Asiatic States. Mining investments account for nearly one-third of Asia's total foreign direct investment, or FDI, in African nations. By working to secure a solid base of critical raw materials, the Pan-Asiatic States strengthens its economy for decades to come.

Pan-asiatic states