Editor's note: Ambassador Hisham El-Zimaity, Former Assistant Foreign Minister of Egypt for International Organizations and Multilateral Diplomacy, a Non-Resident Senior Fellow of Chongyang Institute for Financial Studies at Renmin University of China, replies to interview-questions by Beijing News on FOCAC, China-Africa Relations, and China-Africa cooperation under the "Belt and Road Initiative".
FOCAC SUMMIT: MAKING HISTORY
Question1- FOCAC has witnessed its establishment and development over the past 18 years. What do you think of FOCAC? What achievements has FOCAC made? What is the new significance of this summit?
Hisham El-Zimaity: During the past years of friendly cooperation with China, Africa has grown at a rate of 3% faster than the global GDP, with regional growth predicted to remain stable above 5% in 2018. Africa’s working age population is expected to double to 1 billion in the next 25 years. Therefore, the BRI merits its rightful place on the global developmental agenda, as long as it promotes inclusive development, poverty eradication and shared prosperity. It is a concrete example of the realization of United Nations Agenda 2030 for Sustainable Development locally, regionally and globally.
Africa and China should ensure that all instruments and mechanisms of global governance allow for the full realization of this crucial endeavor which, as long as it is based on mutual benefits, will make the win-win partnership a reality on the ground, and give much needed hope to the peoples of all participating countries for a genuinely prosperous future.
Needless to say that genuine and effective international cooperation is essential in providing developing countries with appropriate facilities to foster their development. No developing or least developed country would be able to attain them, partially or fully, without effective public and private partnerships from China, the developed world and international financial institutions. These partnerships should focus on unleashing the enormous potentials of peoples, resources and comparative advantages, through substantial investments and finance for development which promote entrepreneurship, human and technological capacity, and sustainable growth. The role of China is of extreme importance in this context.
Africa commends China for defining the characteristics of its international development model or what some have coined as the Beijing Consensus which are: Investment-led rather than foreign-aid based development; Resource for infrastructure swaps instead of aid; Investments in improving people-to-people bonds; and a vital focus on technology transfer, investments in human resource development, and capacity building projects in order to ensure the sustainability of development projects. Availing sustainable affordable quality infrastructure for all is an African priority that secures the success of the Belt and Road Initiative.
Q2. How do you think of the prospect of Africa-China relations? What are the new challenges in our relationship?
Hisham El-Zimaity: China has always put the people first during its development phases, increasing their benefits, ensuring the people are their own masters. China effectively safeguarded the people's right to development and carved out a human rights development path with Chinese characteristics. China actively participated in global governance and promoted inclusive development, striving to create conditions and opportunities for all nations, especially developing countries, so that they share the fruits of development. This position by China is highly appreciated by African nations in particular.
The Strategic Security and Military Cooperation between China and Africa, to be approved by the FOCAC Summit, is a major roadmap aiming at coordinated response to the many interlinked challenges confronting the stability of the continent with the purpose of strengthening security and resilience, conduct cross-border counter-terrorist operations, combined military training and joint operations, deepening exchanges on new technologies, intelligence sharing on security on combating terrorism, to further widen Africa's response to crisis situations, as well as to safeguard Chinese investments on the continent.
A major military roadmap aiming at coordinated response to the many interlinked challenges confronting the stability of the continent was discussed by Army Chiefs from China and 50 African nations, with the purpose of strengthening security and resilience, conduct cross-border counter-terrorist operations, intelligence sharing, combined military training and joint operations, to further widen Africa's response to crisis situations, as well as to safeguard Chinese investments on the continent. To guarantee Africa’s peace and development, China and Africa continue to work together to stabilize the Great Lakes region and the Central African Republic, the Sahel region, Mali, Libya, South Sudan, and Somalia, while combating terrorism, illegal trafficking of humans, drugs and narcotics.
In this context, Africa appreciates China’s continued support to the African Union, its regional economic communities and other African sub-regional institutions dealing with issues of peace and security in Africa, as well as China’s military assistance over the years, in supporting the African Peace and Security Architecture, including making operational the African Capacity for Immediate Response to Crisis, and the African Standby Force.
It is very much appreciated that, within the BRI, Beijing is actively involved in more than 3,000 infrastructure projects with more than 225,000 Chinese workers building roads, railways and port networks across Africa, connecting them to major global sea routes, and areas such as the Gulf of Aden, the Red Sea and the Suez Canal, which are vital routes connecting Africa to Asia and Europe. Today, almost one million Chinese citizens live in Africa, while more than 200,000 Africans reside and work in China.
BELT & ROAD: EFFICIENT GAME CHANGER
Q3. It has been 5 years since “one belt one road” initiated. What do you think about OBOR? What is the prospect of cooperation between China and Africa in the OBOR framework?
Hisham El-Zimaity: China, as a major strategic global player and a permanent member of the UN Security Council committed to peace, stability, progress and development should continue to act as a builder of world peace and contribute to global development, while upholding international law and order.
The African Union’s Agenda 2063, launched in 2013 is an ambitious 50-year vision – developed by African strategists – aspiring to achieve an integrated and prosperous Africa, guided by five-10 year plans, with the main focus on inclusive green growth and sustainable development, political and economic integration, good governance, peace and security, and building global partnerships.
Availing sustainable affordable quality infrastructure for all is an African priority essential for the success of the Belt and Road Initiative. Empowering Africa’s private sector, including SME's, to maximize finance for development should be geared to effectively contribute towards achieving not only a sustainable climate-friendly growth, but also an inclusive one, thereby harnessing BRI as a catalyst for reducing inequality, advancing shared prosperity, and contributing to the stability of the African Continent.
GLOBALIZATION IS ESSENTIAL
Q4. In recent years, conservatism around the world is on the rise. The trade war provoked by the United States also casts a shadow over the development of the world economy. Is there a special significance in Africa-China relations under this background.
Hisham El-Zimaity: All trading partners, especially from Africa are hopeful that the multilateral trading system and the WTO will be preserved, and that trade disputes shall be solved within the rules of the World Trade Organization. Africa recently created the African Continental Free Trade Area, (AfCFTA), and is working hard to tear trade walls down in order to make the continent the largest free trade area created since the establishment of the WTO. No trade walls or disputes among the two biggest trading partners of Africa are needed at this juncture.
EGYPT & CHINA: OLDEST CIVILIZATIONS
Q5. Egypt is the first African country to establish diplomatic relations with China. What cooperation has been carried out between the two countries during these years? How do you think of the prospect of Egypt-China relations?
Hisham El-Zimaity: History teaches us that friendship between China and Egypt has successfully passed the test of time. In May 1956, Egypt was the first African and Middle Eastern country to establish diplomatic relations with the People’s Republic of China. Later that year, Egypt was subjected to a military tripartite aggression for having nationalized the Suez Canal. Beijing considered this aggression a direct threat to China, demonstrated solidarity with the Egyptian people by expressing its readiness to send volunteers to defend Egypt, and even offered Cairo a symbolic gift of 20 million Swiss Francs. Today, more than 60 years later, China and Egypt’ comprehensive strategic partnership and their determination to achieve win-win cooperation through the Belt and Road initiative, is a remarkable example of solidarity and friendship to be followed by others.
President Al-Sisi, visited China five times in three years within the framework of the Comprehensive Strategic Partnership between China and Egypt. He emphasized that Egypt adopted far-reaching economic reforms in macro and sectoral policies according to a national plan guided by the 2030 Agenda for Sustainable Development and the African Agenda 2063, thus, putting the Egyptian economy on the right track for inclusive development. The President added that Egypt was a particularly crucial part of the Maritime Silk Road, with the Suez Canal serving as the vital strategic connecting point between the Indian Ocean and the Mediterranean Sea. This positions Egypt as a major partner for the success of the Belt and Road initiative.
The Suez Canal Economic Zone, is considered an integral part of the Belt and Road for hosting several mega industrial, technological, and logistic zones to enhance the free movement of trade, industry, transportation and innovation on the regional, African and international levels, and by such, opening viable opportunities for economic integration. The benefits of Egypt's trade agreements with European, African and Arab states allow the products of Chinese investments better preferential market access. The Suez Canal zone's location is a few hours away from the Southern and Eastern Mediterranean Ports, Jeddah in Saudi Arabia, as well as the Ports of Djibouti, and Mombasa.
While in Cairo, in January 2016, President Xi advocated that China and Egypt should work together to make Egypt a hub for the Belt and Road involving Chinese cooperation on infrastructure projects, with additional investment in industrialization in the Suez Canal Economic Zone. During this historic visit, both governments signed a memorandum of understanding on cooperation on the Belt and Road to achieve peace and social stability through inclusive economic development.
President Xi encouraged Chinese companies to participate in Egypt’s major projects, including developing the Suez Canal Corridor and building the new administrative capital outside of Cairo. China and Egypt have already taken steps to cooperate on those projects which are expected to create more than 20,000 jobs for Egyptian youth. The benefit for China is that projects undertaken in Egypt will be directly tied to the Belt and Road, and seen as a solid support for the Chinese initiative.
SUEZ CANAL STRATEGIC WATERWAY
Q6. In which areas can China and Egypt deepen cooperation in the framework of OBOR?
Hisham El-Zimaity: Last May, while addressing the Belt and Road Forum for International Cooperation, President Xi accurately underlined that the pursuit of this vital initiative requires a peaceful and stable environment, and a new spirit of international relations where nations forge partnerships of dialogue not confrontation, respect each other's sovereignty, and territorial integrity, each other's development path and social system, and each other's core interests and major concerns. He added that development needs to be more inclusive and balanced, the gap between the rich and the poor needs to be narrowed, and that an open and resilient financial system was crucial to supporting sustainable growth. We totally espouse this vision.
Instability in some regions is causing insecurity as terrorism is raging. Therefore all nations should intensify counter-terrorism efforts, address both its symptoms and root causes, strive to eradicate poverty, and achieve social justice. Uprooting the danger of terrorism requires a comprehensive approach in order to eliminate all terrorist organizations without distinction by standing up firmly to all aspects of the phenomenon of terrorism including financing, arming, training, and providing shelter, as well as political, ideological and media support.
STABLE & SECURE EGYPT
Q7. Since the “Arab Spring” in 2011, countries such as Egypt seem to have fallen into chaos during the transition period. Will the situation affect the business environment and the cooperation with other countries? What will the Egyptian government do to dispel this concern?
Hisham El-Zimaity: Visiting Egypt is the easiest way to dispel concerns. Last year, more than 200.000 Chinese tourists visited Egypt and enjoyed their vacations there very much. They witnessed the big progress made on the security, political, economic and social fronts. They saw daily progress in the making.
Objective observers and Chinese friends, admire how Egyptians managed in June 2013 to put an end to the most obscure period of their history; how their unity saved their millennial state from disintegration; how their collective wisdom avoided a civil war planned and financed by foreign powers; how they smoothly adopted a progressive constitution by world standards in a popular referendum; how they elected in 2014 and re-elected in 2018, with a sweeping majority, their national hero and nation’s savior — as their President.
The answer is simple: Have a look at the region’s map. Observe the sad realities in great nations like Syria, Iraq, Libya, Yemen, Somalia or Mali. Had it not been for the solidarity and alertness of the people, Egypt would have joined that list. Today, Egyptians are working hard re-building the oldest nation on earth on stability, safety, equality, social justice and human dignity.
Egyptians remain grateful to Chinese friends who stood by their side during the difficult years, as Egypt fought and continues to fight the curse of terrorism and obscurantism from which no country is immune.
Having restored its historically moderate identity based on acceptance and coexistence, Egypt today stands on solid ground as it regained stability, security, safety and normalcy. With the support of believers in true moderation and tolerance, like our Chinese friends, the resilient will of Egyptians will continue to triumph.
Regarding Egypt's Economic Outlook, reform momentum is sustained, economic activity is improving and imbalances are projected to narrow further. Real GDP is forecast to grow by 5% in FY18, and to increase gradually to 5.8% by FY20. Growth is expected to be driven by resilient private consumption and investment, in addition to a gradual pickup in exports notably from tourism and gas.
The budget deﬁcit is expected to narrow to 9.8% of GDP in FY18. This is slightly higher than initially-budgeted, due to larger interest payments, higher international oil prices, and larger-than-budgeted exchange rates. The ﬁscal consolidation program is expected to rely on revenue mobilization, in particular the increase in VAT receipts, in addition to energy subsidy reforms. The current account deﬁcit is expected to narrow to 4.9% of GDP in FY18, from 6.6% of GDP in FY17.
Furthermore, extreme poverty in Egypt is practically eradicated. Using the national poverty threshold, about a third (27.8%) of the population was below the poverty line in 2015. Macroeconomic conditions are improving, as Egypt’s twin deficits are narrowing and inflation has receded sharply in recent months. The Central Bank has cut key policy rates for the first time since the tightening cycle that accompanied the exchange rate flotation in November 2016. Economic activity is picking up, and unemployment rate has fallen below 12% for the first time since 2011.
CHINA & AFRICA: SUCCEEDING TOGETHER
Q8. What are your expectations for this summit?
Hisham El-Zimaity: The FOCAC Summit of 2018 is going to be remembered as the point in time when win-win cooperation for shared prosperity was translated into concrete deeds. The One Belt One Road Initiative deserves its rightful place on the global developmental agenda, as it promotes inclusive development, poverty eradication and shared prosperity. It is a concrete example of the realization of Agenda 2030 locally, regionally and globally. All of AFRICA is committed to the success of BRI and achieving developmental goals together to make it a win-win cooperation for shared prosperity.
Good afternoon ladies and gentlemen! It is great to be with you virtually again two and a half years on from the initial meeting we had, for the launch of this important book. My chapter was entitled “seventy years of energy sector development in the People's Republic of China” calculated incrementalism.