Founded on October 1, 1949, the Consulate of the People’s Republic of China, will today, (Sunday, September 24, 2017), celebrate the occasion of its 68th Anniversary, at the Oriental Hotels, Victoria Island, Lagos. The epoch-making events which will be declared open by His Excellency, Chao Xiaoliang, Consul General of China in Lagos, is billed to kick-off by 12:00noon.
Expected at the colorful event are eminent Consul Generals, Career Diplomats, Politicians, Academics, Journalists, Business Tycoons, among others.
China-Nigeria Releations In Brief
The People’s Republic of China and the Federal Republic of Nigeria established diplomatic relations on February 10, 1971. Bilateral relations have since enjoyed smooth and steady development.
Chinese leaders who visited Nigeria are as follows: Vice Premier Geng Biao (October 1978), Vice Premier Huang Hua (November 1981), Vice Premier Tian Jiyun (November 1984), Vice Premier Wu Xueqian (March 1990), Vice Premier and Foreign Minister Qian Qichen (January 1995), State Councilor and Secretary General of the State Council Luo Gan (September 1996), Premier Li Peng (May 1997), Special Envoy of President Jiang Zeming, State Councilor Ismail Amat (May 1999), Foreign Minister Tang Jiaxuan (January 2000), President Jiang Zemin (April 2002), and Vice Chairman of the Standing Committee of the National Peoples Congress Han Qide (December 2003).
Leaders of Nigeria who visited China are as follows: Head of State, Gen. Yakubu Gowon (September 1974), Vice-President Dr. Alex I. Ekwueme (March 1983), Chief of the Army Staff Gen. Ibrahim Babangida (September 1984), Chief of the Army Staff Gen. Sani Abacha (October 1989), Chief of the Defense Staff, General Abdulsalami Abubakar (July 1997), President Olusegun Obasanjo (April 1999 and August 2001), President of Senate Anyim (December 2001), Vice President Abubakar (July 2002), and Deputy Speaker Nwuche of the National Assembly (July 2002).
Trade Relations and Economic and Technical Cooperation
China and Nigeria have signed a number of agreements on trade, economic and technical cooperation, scientific and technological cooperation, as well as an agreement on investment protection. The two countries set up a joint economic and trade commission. The trade volume between the two countries in 2003 reached US$ 1.86 billion, representing a 59% growth. During the first four months of 2004, it grew further by 17.6% to US$ 609 million, with Nigeria’s export to China registering a growth of 330%. China’s main exports to Nigeria are light industrial, mechanical and electrical products. China’s mainly import from Nigeria are petroleum, timber and cotton.
Up to now, China has set up more than 30 solely funded companies and joint ventures in Nigeria. The main projects contracted or undertaken in the form of labor service by Chinese companies in Nigeria are the rehabilitation of Nigerian railway, the Games Village of Abuja Sports Complex. Major Chinese companies which have undertaken projects in Nigeria are China Geological Engineering Company, China Harbor Engineering Company (Group) and China Civil Engineering Construction Corporation.
Cooperation in Cultural, Educational and Military Fields
China and Nigeria have signed an agreement on cultural cooperation and a protocol on cooperation between institutions of higher learning of the two countries. China began to provide scholarship for Nigerian students to study in China in 1993. From 2002 to 2003, there were 24 Nigerian students studying in China.
The military exchanges between China and Nigeria started in the 1980’s. The Nigerian Defense Academy sent a number of delegations to China. In May 1998, Chief of Staff of the Navy, Rear Admiral O. Miko Agigebi visited China. In November of the same year, Lieutenant General Liang Guanglie, Commander of Shenyang Military Area Command, led a military delegation to visit Nigeria.
Major Agreements and Documents
In February 1971, the Governments of China and Nigeria signed the Joint Communiqué on the Establishment of Diplomatic Relations between the People’s Republic of China and the Federal Republic of Nigeria.
In August 2001, the two countries signed the Agreement on Trade between the Government of the People’s Republic of China and the Government of the Federal Republic of Nigeria, and the Agreement between the Government of the People’s Republic of China and the Government of the Federal Republic of Nigeria on Investment Promotion and Protection.
In April 2002, the two governments signed the Agreement between the Government of the People’s Republic of China and the Government of the Federal Republic of Nigeria for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income.
In July 2002, the two governments signed the Agreement on Consular Affairs, the Agreement on Cooperation on Strengthening Management of Narcotic Drugs, Psychotropic Substances and Diversion of Precursor Chemical, and the Agreement on Tourism Cooperation.
Chinese Citizens in Nigeria
In total, there is around twenty thousand Chinese people, including more than 300 from Taiwan, living in Nigeria, residing mainly in Lagos, Kano and Abuja. In the 1960s, technicians and workers came from Shanghai and Hong Kong to start their business in Nigeria. Since the reform and opening up, more Chinese companies have invested in Nigeria. In 2002, the Nigerian Council for the Promotion of Peaceful Reunification of China was established in Lagos.
Nigeria’s exports to China include food, animals, crude materials, oils, chemical products and manufactured products (Zenith Quarterly 2010:72). In 2000, four broad commodities were exported totalling US$307.3 million, with the main export commodity being mineral fuel and lubricants which represented US$273.7 million followed by crude materials which totalled US$33.3 million, others such as vegetable oil, wax, fats totalled US$0.1 million, while food and animals totalled US$0.2 million. While Nigeria’s exports to China increased from US$307.3 million in 2000 to US$526.9 million in 2005, China’s share in Nigeria’s total exports fell from 1.5 percent to 1.2 in 2005.
Also, Nigeria’s total imports from China increased from US$5.3 billion in 2000 to US$17.7 billion in 2005. In 2005, imports of machinery and transport equipments which totalled US$1229.7 million ranked first followed by manufactured goods which totalled US$566.0 million, miscellaneous manufactured goods totalled US$290.1 million, chemicals totalled US$174.6 million, food and animals totalled US$29.8 million.
According to Bukarambe “from the time when actual functional contacts began, the pattern has been such that China exported manufactured and industrial items to Nigeria and imported unprocessed agricultural and mineral items from it. As time went on, China added mechanical and human expertise and investment capital to the list of items it exports to Nigeria”.
He further asserted that, “the continuation of the trend uninterrupted, unaltered and unabated indicate that China had a net industrial and developmental advantages over Nigeria from the beginning and the imbalance remained”.
However, the implication from this trade analysis is that the Sino-Nigeria trade which has increased since both countries started relations has largely been export of primary products to China and import of finished products to Nigeria, particularly, as Nigeria lacks the technological know- how to produce the finished goods.
For China these advantages have been widening trade imbalance in her favour, access to large Nigerian domestic market with penchant for imported goods and avenue to invest heavily in underdeveloped sectors of the Nigerian economy.
Also, China has undertaken to reduce the average tariff on agricultural imports from 22% to 15% and eliminate export subsidies and non-tariff barriers to the import of several important agricultural goods. However, this initiative was not taken seriously by the Nigerian government. The failure of the cassava initiative by the Obasanjo’s government is a sad example. Farmers were encouraged to plant cassava but government did little in promoting the initiative.
China has set up over 30 solely owned companies or joint venture in Nigeria actively involved in the construction, oil and gas, technology, services and education sectors of the Nigerian economy. Some of the wholly foreign owned investments are: ZTE Nigeria Investment limited, Plas Alliance Company, Royal Motors Company limited etc. some of these Chinese investments have also benefitted from incentives in the country such as pioneer status and expatriate quotas. According to UNCTAD, Nigeria accounted for over 80 percent of about $7 billion inflow to West Africa and this was dominated by Nigeria’s oil industry, these inflows mostly originated from China.
In 2007, the China National Offshore Oil Company (CNOOC) limited made payments for a 45% stake in the Akpo oil field, with expected production of 225,000 barrels of oil per day. The total deal offered to CNOOC was worth US$2.7 billion. Subsequently, Chinese National Petroleum Corporation (CNPC) received the license for four oil blocks-OPL 471, 721,732 and 298 in return for a commitment to invest US$2billion to rehabilitate the Kaduna oil refinery.
President Musa Yar’Adua’s inquiry into the oil block auctions in 2007 was strongly critical of the oil-for-infrastructure approach. The investigative committees report questioned the conduct of the bidding rounds and the awarding of blocks to bidders who were well connected but had little industry experience.
Secondly, the committee said the system had been abused, with the Asian multinational oil corporations gaining access to high potential oil assets but failed to deliver on the promised infrastructure projects. With contracts cancelled or suspended, this resulted in a deep set-back for this Chinese oil company.
In the information and communication technology (ICT) sector, the development of the national backbone infrastructure occupies a prominent place. Nigeria’s first communication satellite NigComSat-1 received financing from China Exim Bank.
The Nigerian Communication Satellite (NIGCOMSAT-1) was launched in 13 May, 2007 at the cost of $256m, out of which China Export Import Bank gave a loan of $200m and offered to control and managed it for two years. Unfortunately, due to solar power assembly problems, the satellite was de-orbited on November 10, 2008. The Chinese authorities quickly commenced replacement of the satellite at no cost to Nigeria.
The Chinese Civil Engineering Construction Corporation (CCECC) was awarded the contract for the modernization of the Nigerian one track rail line to standard gauge rail project. In October 2006, the Nigerian government signed a US$2.5 billion loan facility with China, a substantial part of which was used to finance the refurbishment of the railway system.
The contract for the first phase covered 1,215 kilometres of double track standard gauge line from Lagos in the southwest to Kano in the northwest with a branch in Minna and Abuja was signed. The railway modernization and expansion project when completed will be able to run 36 trains per day from Lagos to Kano.
The China Exim Bank is partly funding thermal power stations in Nigeria. By the end of 2006, China was providing US$3.5 billion toward the construction of six major hydro-power projects amounting to some 6,000 megawatts (MW) of installed capacity the Chinese are: Ughelli, Geregu, Papalanto, Alaoji and Omotosho power plants through a credit facility repayable in 12 years. It is also to develop financial and technical support for two new hydropower plants at Zungeru and Mambilla in northern Nigeria.
In the manufacturing, the Chinese investment has been in the textile sector, but has manifested itself to large investment in industrial processing zones in a number of states in Nigeria e.g Ogun and Lagos states, which consist of 100 firms engaged in the light to medium manufacturing activities including footwear and rubber production, ceramic processing, furniture production and household appliances. These activities promised to generate employment to different categories of Nigerians.
The importance of the investment and technical cooperation with China to Nigeria cannot be over-emphasized as they are targeted at those sectors- power, communication of the economy that particularly require such interventions. They are also areas in which China has developed appreciable expertise from which Nigeria can draw immense benefits.