Sub-Saharan Africa's share of Chinese imports declining

by Trust Matsilele 0

“China is a key destination for sub-Saharan Africa’s oil exports, which have grown at an annual rate of 35 per cent since 1995,” said the HSBC’s Multi-Asset report.

(READ MORE: China-Africa trade now 2000 times more than 1960)

“However, this growth has not matched China’s booming demand, resulting in sub-Sahara becoming a declining share of China’s oil imports, which has fallen almost 10 per cent points over the last five years.”

South Africa among the regional economies is regarded as the the largest exporter to China in recent years as a result of rising commodities demand by the Asian country.

“South Africa has become the largest exporter to China in recent years as a result of rising coal, iron ore, and precious metals exports, accounting for almost two-fifths of the region’s exports over the period 2010-2012,” said the Multi-Asset May report.

According to the report, resource-abundant countries account for the majority of sub-Saharan Africa’s exports to China with Angola, South Africa and Sudan representing about three-quarters of exports to China over the past two decades.

“Export growth from Sub-Saharan Africa to China has averaged more than 25 per cent per year since 1995, while imports have grown by nearly 20 per cent per year,” added the report.

Sub-Saharan Africa’s export basket to China is highly concentrated. Over the past decade, crude oil has accounted for about 60 per cent of the region’s exports to China, illustrating the important role energy has played in China-Africa trade ties.

China accounts for almost one-fifth of sub-Saharan Africa’s exports and 14 per cent of its imports, making sub-Saharan Africa-China trade equal to about 13 per cent of the region’s GDP.

(READ MORE: China-Africa trade grows tenfold in a decade)

China is the world’s second-largest oil consumer, with oil demand accelerating in tandem with rapidly expanding transport and industry sectors.

Africa is an important source of raw materials, particularly crude oil, iron ore, and copper, supporting China’s remarkable investment-led commodity-intensive growth path.