Lake Victoria Mining Company

Nov. 8 (Bloomberg) — China will offer Africa $10 billion in preferential loans over the next three years to develop infrastructure and social programs, and will write off the debt of some of the poorest nations, Chinese Premier Wen Jiabao said.

China also will construct 100 new clean-energy projects on the continent and gradually lower customs duties on 95 percent of products from African states that have diplomatic ties with China, Wen said today in an address to delegates at the Forum on China Africa Cooperation conference in Sharm el-Sheikh, Egypt.

China has been making a drive to invest in minerals and energy in Africa to feed its growing economy, as well as to sell more to the continent. China invested $7.8 billion in Africa last year.

“China’s importance for Africa goes beyond just numbers on investment and trade,” Razia Khan, head of Africa economic research at Standard Chartered Plc said in a phone interview from London. “China has been a key driver in the resurgence in investor interest in frontier markets in Africa.”

In the last meeting of the FOCAC, in Beijing in 2006, China promised to provide $3 billion in preferential loans and $2 billion in buyers credits through 2009. Chinese Foreign Minister Yang Jiechi told the official Xinhua news agency yesterday that China fulfilled the pledge.

“This meeting now represents a new stage of development in relations with Africa,” Wen said. FOCAC, created in 2000, includes China and 49 African countries.

Since 2006, China’s energy companies have announced plans to spend at least $16 billion on oil and gas fields on the continent.

Total Trade

Last year, China-Africa trade totaled $107 billion, an increase of 45 percent from the year before, the government- controlled China Daily said. In 2007, China was the largest individual exporter to the region with a market share of 9.8 percent, the U.S. Commerce Department reported in July.

“Chinese investment has become even more important for Africa in the current global crisis as aid and development financing from traditional Western development partners comes under pressure,” Ridle Markus, Africa economist at Absa Group Ltd. in Johannesburg, said in an e-mail.

In West Africa, China Petrochemical Corp., or Sinopec Group, the nation’s second-largest oil company, acquired Swiss-based Addax Petroleum Corp. this year for C$8.3 billion ($7.7 billion), adding oil reserves in Nigeria, Cameroon and Gabon.

Last year, China agreed to invest $9 billion in Congolese infrastructure in return for control of mining deposits.

More Investment

“We want more investment from China,” Tanzania’s President Jakaya Mrisho Kikwete said in a speech at the forum.

The pattern of trade — raw materials going to China and Chinese finished goods flooding Africa — has concerned Africans, some of whom have launched the kind of accusations at the fast- growing Asian nation once hurled at colonial powers: that China is in Africa to exploit.

Egypt, the Middle East’s most populous country, is discussing trade practices with China, with which it holds a large trade deficit, Trade and Industry Minister Rachid Mohamed Rachid said.

“What is a worry for me is if competition is unfair,” Rachid said in an interview at the FOCAC conference. “That is where we are unhappy.”