French firms must fight China for stake in Africa - Moscovici
By Joe Bavier | December 2, 2012 2:14 AM EST
French companies must go on the offensive and fight the growing influence of rival China for a stake in Africa's increasingly competitive markets, France's Finance Minister Pierre Moscovici said on Saturday.
France, which once ruled over much of West Africa as colonial master, continued to exert direct and indirect influence over its ex-colonies for decades through a murky system of patronage known as "Francafrique".
However, that regional reach is now being challenged by a new Chinese investment blitz.
"It's evident that China is more and more present in Africa...(French) companies that have the means must go on the offensive. They must be more present on the ground. They have to fight," Moscovici told journalists during a trip to Ivory Coast.
France's Socialist President Francois Hollande has promised to break with his conservative predecessor Nicolas Sarkozy's business-focused policy towards Africa and root out the last vestiges of Francafrique.
However that does not mean France will back away from competition with China for economic influence in Africa, Moscovici said.
"Africa is booming. Sub-Saharan Africa will have the second highest regional growth after Asia in 2012 with a rate of 5.5 percent," he said.
"The new phenomenon is that African growth has the potential to stimulate growth in France. We want to be present there."
French firms including infrastructure group Bouygues
But working in sub-Saharan Africa carries risks that some firms are loath to take, as demonstrated by the kidnapping of seven Areva employees in Niger in 2010.
At the same time China's trade with Africa reached $166.3 billion in 2011, according to Chinese statistics, and African exports to China - primarily resources to fuel Chinese industries - rose to $93.2 billion from $5.6 billion over the past decade.
China in July offered African countries $20 billion in loans over the next three years, double the amount pledged in the previous three-year period.
Moscovici said the creation of a new Public Investment Bank would boost the competitiveness of French companies on the world stage.
The fund of around 40 billion euros ($52.02 billion) is intended to ease lending to small and medium-sized businesses and inject capital directly into selected companies. The law creating it passed the lower chamber of France's parliament last week and will go to the Senate later this month.
"It will be the bank for the SMEs. It will be the bank of...the regions. It will also be the bank for exports," Moscovici said.
"And it's on this basis that our businesses will head out with more confidence to conquer new markets and be more present in our traditional markets," he said.
Moscovici was due to sign a debt conversion contract with the Ivorian government on Saturday that will see 630 million euros of the west African nation's debt to France transformed into poverty reduction projects.
Initial projects will target areas, including infrastructure construction and rural development, aimed at stimulating Ivory Coast's economic growth. ($1 = 0.7689 euros)
(Editing by Keiron Henderson)
Most Popular Slideshows
- 2014 MLB World Series Game 1: San Francisco Giants 7, Kansas City Royals 1 [PHOTOS]
- 2014 MLB World Series - Game 2: Kansas City Royals 7, San Francisco Giants 2 [PHOTOS]
- NFL Thursday Recap - Denver Broncos 35, San Diego Chargers 21: Peyton Manning Has 3 TDs In Easy Win [PHOTOS]
- 2014 MLB World Series Game 3: Kansas City Royals 3, San Francisco Giants 2 [PHOTOS]
Join the Conversation
- Tourre on stand says email in SEC case 'not accurate'
- Syrian authorities blocking access to needy in Homs - Red Cross
- Faith in European Union at low ebb, EU poll says
- Former UBS banker gets 18 months, $1 million fine, for muni bid-rigging scheme
- U.S. judge halts challenges to Detroit's bankruptcy bid
- Xiaomi Redmi 1S vs. Sharp Aquos Crystal – Specifications, Features And Price Showdown
- Verizon Motorola Droid Turbo Leaked Live Images Surfaces, Scheduled To Get Unveiled On Oct 28
- Update HTC One M7 with LG G2 with Android 4.4.2 as Sprint OTA: Fixes and Installation
- U.S. Targets Buyers of ISIS Oil, Threatens Sanctions
- ISIS Syria Airstrike Bombing Has Killed 550 People, Civilians Included
- Russia Shifts Blame On US For Ukraine Crisis, Putin Accuses West of 'Remaking World'
- Russia Blocking OSCE Monitoring Of Its Border With Ukraine