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Maputo city: Chinese ties with Angola, Mozambique and Cabo Verde (Cape Verde) involve Macau and Portugal


The re-opening of the Benguela railway in 2014 will remain as China’s flagship project in Angola, but as well as a symbol of a year in which the relationship between China and Portuguese-speaking nations continued to increase.

Chinese ties with Angola, Mozambique and Cabo Verde (Cape Verde) involve Macau and Portugal, which in 2014 saw Chinese investment in the country rise to 10 billion euros, with several new deals expected in 2015, this time in the financial sector.

Initially Chinese companies invested in energy – EDP – Energias de Portugal, the assets of EDP Renováveis and REN – but in 2014 the focus was on services – the major Portuguese insurer, Fidelidade, for 1.635 billion euros, and, through this company, healthcare company Espírito Santo Saúde (presently Luz Saúde), for 478.5 million euros.

Presently, attention is focused on the financial sector: investment bank BES Investimento (BESI) was purchased by Chinese investment bank Haitong and Novo Banco, the bank that holds the “healthy” assets of Banco Espírito Santo, is expected to receive a buy offer of 3.5 billion euros from Fosun International, according to the Portuguese press.

China Three Gorges, which started the run by investing 5.7 billion euros in power company EDP, is beginning to see the partnership bear fruit: joint investments are beginning in Africa and Latin America, particularly dams in Brazil and Peru.

Portugal is as well expected to benefit from Chinese investment on a “micro” level: according to the press, granting “golden” visas to Chinese citizens brought in investments of 900 million euros in real estate, particularly luxury property.

Angola is going through a period of budgetary restraint due to a drop in oil prices and 2015 is expected to be a difficult year.

The China Development Bank is expected to reduce those difficulties by providing a loan of US$2 billion to Angolan oil company Sonangol, which may be followed by other “long-term deficit” in view of the oil company’s next plans, inclunding construction of the Lobito refinery.

Since 2002, the total funding provided by China to Angola has been around US$14. 5 billion, according to Reuters’ calculations.

Chinese national company CITIC Construction Co. is due to invest US$5 billion on a corn, soybean and wheat farm in Angola.

One highlight in 2014 was completion of reconstruction work on 1,344 kilometres of the Benguela railway, next 10 years, which according to the Economist Intelligence Unit will drive the economy by stimulating sectors such as diamond mining and agriculture in the central region of the country.

This year the initial vehicle left the production line at Matchedje Motor, the only car assembly company in Mozambique, an investment made by the China Tong Jian Investment Co., Ltd.

The New Year is expected to see increase of the Chinese stake in the natural gas sector in Mozambique and one of the initial five long-term supply contracts has been signed with the China National Offshore Oil Corp, according to Reuters.

The interest of Chinese oil companies in Mozambique’s natural gas sector led to Sinopec buying a 20 % stake in Area 4 from Italy’s ENI for US$4.2 billion. Area 4 is next to an area explored by US company Anadarko Petroleum.

In Cabo Verde, 2014 stands as the year of the inauguration of the National Stadium, the major sports infrastructure on the archipelago, which was funded by China, while in neighbouring Guinea-Bissau the initial stone of the next Palace of Justice was laid.

Even Beijing’s relationship with Sao Tome and Principe became less distant in 2014 following a visit by Manuel Pinto da Costa, the initial by a Sao Tome president to China in nearly twenty years, despite being in a private capacity.

As for Brazil, the highlight of the year was a national visit by Chinese President Xi Jinping, who dealt with two of Brazil’s major problems in the Chinese market: the ban on Brazilian beef and the production of aircraft by Embraer.

As well in 2014, the Fund for Cooperation and Development for China and the Portuguese Speaking Nations approved two projects: one in Angola, connected to public lighting through solar energy, and one in Mozambique, in the agricultural sector at a time at the same time as 50 projects from Brazil Guinea-Bissau, East Timor, Mozambique and Angola are under review.

The year ended with the visit to Macau by the President of China, Xi Jinping who noted the opportunities brought by the reforms in China to transform Macau into a world centre of tourism and leisure and a service platform in economic and trade cooperation between China and the Portuguese-speaking nations.

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