Speech to Be Delivered by the Minister of Commerce, Trade and  Industry of Zambia, Hon. Felix Mutati, MP at the China International Fair for Investment and Trade in Xiamen on Behalf of the African Continent on 8th September, 2007

The Vice Premier, People’s Republic of China,

Visiting Heads of Governments and Delegations,

The Vice Minister of Commerce, People’s Republic of China,

The Provincial Leadership, Fujian Province,

Cabinet Ministers Present,

Excellencies, Distinguished Delegates, Ladies and Gentlemen,

To begin with, let me express our profound thanks to the President and people of China for the warm reception extended to my delegation and indeed to all other African delegations since our arrival.

I would like to take this opportunity to congratulate you, Your Excellency, and your hard working team for successfully, once again bringing all of us to this beautiful coastal City of Xiamen for the 11th China International Fair for Investment and Trade under the theme: “Introducing FDI” and “Going Global” and a channel for promoting two-way investment and trade.

The theme, Your Excellency, is appropriate and opportune, particularly for the participating African countries in that we shall do everything within our individual capacities to seize the opportunity to broaden and deepen the already improving investment and trade ties between the African Continent and the Chinese people and Government under the China Africa Cooperation (FOCAC) Framework.

I am confident that, under your able stewardship, the 11th Fair will also be conducted in an efficient and constructive manner as previous ones.

Your Excellency, Excellencies, distinguished invited delegates,

As you can all imagine, the speech I am about to start delivering is a very special one for me. Unlike the many others I made in my public life, this one is special and dominated by the feelings and emotions I have developed for China since I started close interactions with the Chinese Government and Business Community just after assuming my current political office.

Your Excellency, Xiamen Fair brings together business people from all over the world to explore business opportunities with a sole motive of advancing their business interests.

Since I am here to represent the Africa continent, I will need to put the continental interest into perspective as an emerging market. Africa is a place which satisfies and signifies a business phenomenon that is not fully described by or constrained to geographic or economic strength.

Usually, discussion of emerging markets is confined to China, India, South East Asia and so on. However, I would like to suggest that the definition of emerging market should include most of Sub-Saharan Africa including Zambia, why?

We in Africa and Zambia included are alive to the fact that emerging market includes a country where politics at least as much economics are all linked to the markets.

It would then appear to us in Africa that emerging markets lie at the intersection of non-traditional user behaviour, the rise of new user groups and community adoption of products and services, and innovations in product and services, and innovations in product technologies and platforms.

The nature of investment information sources leads to two potential problems.  One is an element of historicity; markets may be maintained in an index for continuity, even if the countries have since developed past the emerging market phase. I have in mind the two giants of Asia, China and India, for how long will they remain emerging markets?

Secondly, is the simplification inherent in making an index; small countries, or countries with limited market liquidity are often not considered, with their larger neighbours as appropriate stand-in-when regional economic integration could be taken into account to improve the market space.

According to latest findings from the International Business Report (IBR) published on 19th April, 2007, only four (4) countries were mentioned as the emerging markets to watch, but none from Africa.

 The same report goes on to mention China and India as countries that may match and/or may overtake some of the commonly identified and commonly mentioned economies and may soon join the global economic powers.  China and India have the population behind them, particularly after addressing issues of infrastructure development and ICT inter-connectivity.

We have heard quite a lot about the down side of emerging markets but we should instead devote all our energies on the positive

side of emerging markets.  It has been a known fact that the developed world have been ignoring the progress made by governments in

Africa and businesses across the developing world in recent years.

Time may come when they will have themselves to blame about their decision if they do not seize the opportunity and commit their investments to Africa. I would like, therefore, to call upon the newly emerging economic powers of Asia such as China to consider and continue to consider Africa as a profitable investment destination.

Economic growth in emerging markets is translating constantly into profits. Most investment strategists like Max King of Investec Asset Management points out that returns on equity in emerging markets even exceed those of companies in the developed world.  That is, profits and emerging market companies grow by leaps and bounds when compared to their developed world Counterparts. 

In addition, Governments in developing world including Africa have moved from being by- standers to being facilitators.

Governments in most of Africa including Zambia are now more democratic and inclusive (Consultative) less likely to intervene in the Economy, but have continued to improve their regulatory frameworks.  Of course, we from Africa like the Chinese believe that growth is led by production and export, resulting in trade surpluses and foreign exchange reserves to underpin weak currencies hence my call to all Chinese and other world-class prospective investors to consider coming to Africa including and tap the numerous opportunities which remain untapped in order to help grow our economies.

The Chinese investors should not be discouraged about the negatives that have in certain cycles been less than optimistic.

What makes me optimistic about Africa and my country Zambia, despite some formidable challenges, is that there is more to African Economies than peddling consumer goods to developed world. In particular, there is massive infrastructure and other capital spending taking place – roads, power plants, airports, new mines all being tried to meet the needs of an industrial base that has expanded enormously during the last decade, largely in the last five (5) years of accelerating growth.

Africa is a “great buying opportunity”, for example, Governments in SADC and COMESA are planning to commit billions of dollars on infrastructure development between 2008 and 2015.

And on average, Africa is doing more than anyone could have imagined when it comes to spending on ordinary consumer goods and bit-ticket items like houses and cars. This, therefore, present a good opportunity for Chinese companies to think of Africa as a

rewarding investment destination second to none going by huge rates of return to investment.

Finally, I am certain that we will all benefit from our active participation in the Fair.

Thank you very much for having given me the opportunity to deliver a statement during the official opening ceremony on behalf of all participating countries from the African Continent at such an important occasion with such a wonderful audience and I wish you sincerely every success during the Fair period and beyond.