Chinese construction giant Sinohydro signed a $100 million deal with Angola to build out the country’s agricultural infrastructure in a bid to boost grain production. While 60% of the output from this venture will be shipped to China, the rest will be sold domestically in a move aimed at reducing the West African country’s food import bill.
The Sinohydro news followed an even larger agriculture announcement between the two countries when Chinese conglomerate Citic signed a $250 million contract to develop large-scale soybean and corn farms in Angola.
Géraud and Cobus discuss why the timing of these deals is so interesting as China moves quickly to reduce its reliance on wheat, soy, and corn imports from the U.S.
Show Notes:
- Bloomberg: China Deepens Angola Food-Supply Ties With Second Deal in a Week by Candido Mendes
- Bloomberg: China’s Citic to Develop Large Soybean, Corn Farms in Angola by Candido Mendes
- Business Insider: Chinese firm seals $100 million grain deal in Angola, second agriculture investment this week by Adekunle Agbetiloye
Transcript:
GÉRAUD NEEMA: And today it’s not going to be Eric’s voice, but it’s going to be my voice, Géraud Neema, the Africa editor with Cobus van Staden, our managing editor who’s joining us from Johannesburg today.
Good afternoon to you Cobus.
COBUS VAN STADEN: Good morning.
GÉRAUD NEEMA: So it’s really a pleasure to be the two of us today. So we’re going to have like a mini roundtable without Eric. It’s going to be a conversation, as we know, it’s a China in Africa podcast, so it’s going to be a conversation on different topics that we found quite interesting that happened this week around China Africa conversation.
Cobus has brought us some very interesting topics related to trade, tariffs, and all of that. And we’re going to try to go into details on that to see what’s really happening and how things are unfolding in the China Africa space this week. And many things have been happening on the global scale, many things in terms of geopolitics that may impact Africa in a certain way or another.
And all of that, we need to be aware of that. We really need to be following those situations because sometimes when you have too much information, you tend to not to see where the relevance in that debate are for African countries. And yes, I’m going to stop there.
I don’t want to go too much into detail. So Corbis, tell us, what do you have for us for this conversation today?
COBUS VAN STADEN: A really interesting development in Angola. It was announced this week that Sinohydro, the huge, huge Chinese company, is investing $100 million in grain development, like kind of development of grain farming in Angola. And that comes after an announcement last week that another Chinese company, CITIC, is investing $250 million also in soybean and maize kind of farming in Angola as well.
So it’s a very interesting development. Through the years, if people who follow China-Africa stuff know that there’s been this kind of ongoing kind of drumbeat about this idea that of Chinese land grabs, quote unquote, in Africa, and then also the idea that parts of Africa will grow crops to export to China. So that has been debunked famously by Deborah Broughtigam, who dedicated an entire book to kind of unpacking this issue and debunking it.
This seems to be an interesting new development in this field. What Sinohydro is saying is that 60% of this grain is actually going to be exported to China, and the rest is going to be used locally. And then it’s going to be a mix of commercial and local community farms.
So they’re going to be dividing a huge amount of land, like they’re leasing, they got a 25-year lease on a large amount of land, which they’re then going to be dividing into plots, some commercial and some community farming. So it’s a very interesting kind of development, particularly in the context of China shifting its agricultural imports away from the US.
GÉRAUD NEEMA: Oh, yes, definitely. It’s a very interesting topic, as you mentioned, because two things are coming into mind. First of all, we remember that when Joao Lourenço came into power, when he visited China, I think he visited China two or three times.
And in the last time when he was there, he made a call to Chinese investors saying that we want China to diverse its investment in Angola, because for those who’ve been following China and Africa, we know that for so many years, China in Angola was equal to oil, petroleum investment. And we know that it’s also with large infrastructure. And Angola was trying to say, well, you know what?
We want China to be our partner in defense in other sectors than the oil sector. And seeing those kinds of developments, it’s really something quite interesting to follow, because it’s also signaling the willingness of China to adapt into a new environment. And its second point, this is where I wanted to get to.
It also plays out into the focal drum beats and all the declarations that we had last September, the declaration about agriculture, what China is intending to do in many African countries, investment it’s intending to pull in those African countries. And still in agriculture, when you leave Angola, we see a larger trend that’s taking place on the continent, where you see a lot of Chinese agricultural farms are taking place in Africa, in Cote d’Ivoire, in Ghana, in different parts of the continent, in the DRC, in Burundi, where you have Chinese farmers also, even in Zambia, if I remember correctly. Those kind of news that we don’t really pay attention to them because, you know, it’s farm.
And when you start farming, we also see that, you know, all agricultural products under, you know, those aid approach. So it doesn’t really catch attention to headlines made because it’s not really, let’s face it, politically sexy or news sexy enough to talk about it. We don’t pay attention to that and we don’t see those kind of news.
But I think there is a lot of things that are happening in agriculture sector that we have to pay attention to that. If we do not, we may really miss really what China is really trying to build in agricultural business in Africa. And that’s going to be very important.
And third point, Angola. This is what I wanted to get as well. Angola, geopolitics of it.
And when I saw the news, when you shared it, I was like, oh, that’s interesting. Because when we talk about Angola geopolitics, remember there is another project, the Lobito Corridor project, which basically was first and foremost infrastructure project. But we remember that there is a agricultural component to it that, you know, the form that the administration wanted to add into it.
We still don’t know if under Trump, we’re going to see those projects materializing. But we do know that there is also an agricultural component into this Lobito Corridor project. So those three points made for me the story quite interesting to follow and to really see how it’s going to unfold and how it’s going to develop over time.
COBUS VAN STADEN: Yeah, like Angola has been very interesting in this respect, I think, because they’re a little bit Vietnam-like in the sense that they maintain these very close relationships, very long historical relationships with China, and keep working with China, finding new ways of working with China, while at the same time, really appealing to the US. You know, so there’s even under the Trump administration, there’s been these kind of delegations visiting and so on, you know, and a lot of kind of close conversation between the two. So it’s quite interesting for me.
Two things, like one is that, you know, there is this traditionally, I think, in Western kind of like views of this kind of agricultural cooperation, there’s this split between a pure aid approach, you know, kind of looking at kind of like small scale farmers, rural empowerment, and so on, and then fully commercial, you know, like, you know, essentially kind of paving whole kind of like square kilometers in soybeans. And the two kind of come together in this, you know, kind of like approach, because they are doing this very expansive kind of commercial farming.
But there’s also like seed development centers being put up, you know, kind of being funded by Sinohydro and so on, which feeds into this kind of like, what you frequently find with China in Africa is that there is these agricultural demonstration centers, which are kind of co-run by the government, like government as an aid project, but then also with commercial seed companies. And, you know, like in collaboration, so it’s kind of like semi like half aid, half commercial. And this seems to be also kind of the approach here.
And also with this kind of like hybrid approach of both commercial farming and small scale farming kind of like fit in. Other thing that was very interesting for me is like one of the Sinohydro officials was quoted saying that Angola is one of the easiest places in Africa to do business. And so I wanted to ask you about that.
Like, what do you thought about that?
GÉRAUD NEEMA: I mean, that’s the point when you say Angola is one of the easiest places to do business with. From a Chinese perspective, I would say, yes, historically, they always had a easy environment to do business in Angola. But since Joao Lorenzo came into power, things have been quite difficult for them.
Let’s face it, they’ve been seeing the influence, you know, really shining out and they’ve been seeing they’ve lost major contract in infrastructure, the Lobito, the Lobito concession contract, the Lobito ports concession contract, the Benguela Railway concept, all of that. They’ve kind of and the Katoka diamond mine, all of that Chinese company have seen the influence, you know, kind of reduce and not being not shining as bright as it used to be before. So when he says that, we still understand that, yes, it’s not lovey dovey as it used to be before, but yet it’s still an easy place for them because they kind of have a kind of they still have a friendly environment where they still can do business.
And this is something that speaks to the context when we do know that, for example, a few weeks back, we had a U.S.-Africa business summit that took place in Angola. And we had a lot of American businessmen, African business meeting there talking about all kinds of investment that the U.S. wants to do in Africa. And we also had last year, one of the main absent person who lacked, who did not go to the FOCAC was Joao Lorenzo from Angola.
He was not in the FOCAC. So we have all those development things that have been happening in the last year and a half when, for example, we spent like almost a year without a Chinese ambassador in Angola. It was quite difficult.
So we had those kind of development where when we hear him say that, you know what, Angola is still a good place for us to do business, we understand that, say, politically, we may not be the way we used before, but from an infrastructure, structural places, we believe that it’s still a good place for us to do business. And as you say, even the way Angola is managing its relationship with the U.S., with Europe, with China, it’s not going to create a space where they’re going to make Chinese feel unwelcome or feel, you know what, you’re not welcome here anymore because you don’t really want to put all your eggs in the same basket. But I want to get back to the second, to the point that you made that I did really find interesting, the fact that we see a combination of both commercial and development aid.
And we can see that hybrid approach can allow China to play on both sides of this narrative, that to say, you know what, on the aid front, we are present. We’ve been helping agricultural farmers in Africa to develop, to learn new technique and new approach and to yield much more crops and more results and to really help fight anger in Africa. And from a commercial side to say, yes, we’ve been empowering them to become businessmen because let’s not forget, we still have the free, the non-tariff policies that China has put in place.
And we do know that China has been working into compensating the trade deficit between Africa and China through agriculture. And many have been saying that when we look at the amount of agriculture yield that African farmers are putting, when you look at the demand that African market has itself internally, we don’t see how African countries are going to produce an excess in a way that they can export to China. So it’s not really a solution.
But when you see now China coming into that space, you realize that maybe they’re seeing an opportunity here for them to say, you know what, we can play the way that we win. We open our markets to agricultural products from Africa, but we’re not losing in a sense where we are also the one investing in the farming product in Africa. So we are present there.
So no one can accuse us to use African soil for us because what we are using, it’s actually for to empower African farmers, even though a big part of it is going to come back to China. That’s very interesting hybrid approach that I think that China is going to use into its narrative on how it’s playing that card.
COBUS VAN STADEN: I think so. I mean, another thing that’s kind of interesting for me is, you know, over the last year or so, we’ve seen very rapid increases of the same kind of crops, soybeans and maize, particularly from Brazil to China, you know, particularly as China was starting to kind of move to try and get to avoid exposure to the US. And actually, like if one takes the US kind of agricultural press, they freaking out like, you know, kind of like it’s really is kind of crashing in there.
But I was wondering, there’s an interesting kind of like Portuguese speaking connection. Like I mean, Brazil has always been a big, you know, like a significant influence in Angola. And there’s, you know, there is kind of these kind of cross Atlantic connections.
So it’s, you know, I have no inside information about whether there’s any kind of Brazilian connection, but it is an interesting kind of like connection between the two of them and China.
GÉRAUD NEEMA: But beyond the two of them of China, when we see the how the China is using Brazil and other Latin American countries to balancing, to kind of balancing its offset of US import in terms of agricultural product, we can see the same logic playing out in Angola, like where China is really trying to say, you know what, as much as we’re also relying on Brazil, we want to develop all the supply chain of those agricultural product in a way that we do not find ourselves to be depending only on one single producer in Latin America, because it’s still quite far from China. And having it in Africa, it’s still a win an easy way for them to kind of balance out all the supply chain debate on agricultural product. And which I think quite interesting, if we follow closely how China has been looking into African lands and how China has been trying to shape the narrative in that agricultural debate.
And this is one of the things as well, I think that we’re not paying attention from the science part of it, because they’re also bringing new technology into farming, into agriculture. So when people are not paying attention to those kind of topic and subjects, they are missing the point that China in the very below the radar in those small stories are shaping and are setting new norms in sectors where we don’t pay attention. When we see the overall trend of what Chinese farmers and China is investing in this agricultural product in Africa, you’re going to realise that a few years from now, we’re going to see that a lot of farmers have adopted Chinese technology, have adopted the Chinese way of doing agriculture in Africa, which I do believe that if we don’t pay attention to that, many are going to wake up and say, wow, China is taking over agriculture in Africa.
COBUS VAN STADEN: Yeah, I mean, it’s really something to keep an eye on, I think, particularly also, as you say, like, I think there’s going to be a lot of technological leapfrogging happening here as well, you know, because a lot of this, in some cases, these African countries are moving into this very intensive mass agriculture for the first time. And China has a lot of very kind of advanced technologies around this. I was obsessed recently with this report that China developed an AI-powered laser, like anti-weeding robot that kind of crawls around and zaps weeds with a laser, like, it just thrilled me endlessly.
So, it’s going to be very interesting to see kind of how these kind of like technologies are applied.
GÉRAUD NEEMA: Yeah, you talked about that. And just I remember when you mentioned that I was saying that those kind of technology, I don’t know if they’re coming to Africa, but I know they’re going to come at some point, are going to be really appealing to African countries. When you do that in Africa, we hate everything that has the appearance of being a GM or something modified because we see, we perceive all of that to be dangerous to our health.
And then we’re kind of right to a certain extent. So, when we see now China is bringing a technology where we don’t need pesticides to be able to keep our crops clean and weeding out all those bad weed from our crops, we should be expecting those kind of technology to be welcoming in Africa. And people don’t pay attention that China is slowly but surely shaping different sectors of African economy that we’re not paying attention to.
COBUS VAN STADEN: Yeah. So, you touched on the Lubito Corridor and there’s another kind of huge trend kind of related to the Lubito Corridor, which is that the Trump administration has announced a 50% tariff on copper imports. So, obviously the Lubito Corridor is famous for trying to facilitate the flow of cobalt out of the DRC in Zambia, but cobalt and copper occur together.
And copper trade is a very significant part of the Lubito Corridor project. So, I was wondering how should we think about the 50% copper tariff? Like who’s going to be paying it?
Who is going to be suffering from it? How is it going to affect Africa?
GÉRAUD NEEMA: So, I mean, from an African perspective, I don’t see much of a huge impact on the continent. Of course, you have major producers like the DRC, Zambia, the two main producers of copper on the continent. But when you look into the export basket of copper and the destination, we see much of a China angle into it.
Most of them are still exporting to China. China remains the main consumer of the copper coming from those two countries. I’m currently working into updating our copper cobalt database on the DRC with the 2024 data, which was really interesting because you see consistently China remains the main destination with different kinds of stakeholders, but China, Asia in general, remains the main destination.
Here and there, you can see some hotspots of one time or two times kind of buying coming from the United States or buying coming from Europe, but most of it are still going to China. So when I think of that, I realize that in the end, if you’re DRC, if you’re Zambia, you’re like, yeah, it’s bad news to a certain extent. But fortunately for us, we don’t rely on the American market as our main destination.
China remains our main destination. So we don’t see much of a long term or significant impact on how we are going to build up. But for Dolomites Corridor, it does remind me of a conversation I had a few weeks back with a researcher, and we were talking about that, let’s face it, and I’ve been telling that Lobito Corridor, it’s the Benguila Railway, at least, it’s only a railway, it’s only an infrastructure that companies being Chinese or non-Chinese are going to use to export their copper and cobalt out of the region to the rest of the world. If it’s not going to the United States, just like it’s doing right now, the majority of it’s not going to the US, it’s still, it’s going to go to China. It’s going to go elsewhere.
And the Lobito Corridor, it’s still going to be viable because I don’t believe that the consortium led by Trafigura had won the concession contract on the Benguila Railway with the idea that we are going to mainly to serve the US and European market. That was not the idea. The idea was like, we are going to serve mining companies which are trying to get their copper and cobalt out of this region quite faster because taking the road down to Durban, it’s quite difficult these days.
So, that was the idea. So, when the DFC came, the United States came, they built the whole narrative around the US and the Americans and all of that, Europe and all of that. It gave the impression that the Lobito Corridor, the Benguila Railway will serve only, mainly for European and Western market, which is not the case.
Because when you talk to the consortium, they tell you beyond We are not really into that mindset. For us, any customer sending its copper, whatever they want to send it, for us, it’s a good business. So, I don’t know if you see things differently from your side.
COBUS VAN STADEN: I’m so not an expert in this field that I sometimes kind of like doubt my own opinions. But one of the things that I immediately thought when I heard the news was, man, it must be the worst time to be like someone trying to run a renewables company in the US. Because I mean, it’s like open season on them, you know, kind of like the copper levy is going to hit them so hard because copper is such a fundamental part of green energy, you know, technology, and then all of the other all of the other things as well.
Firstly, Trump was not a big fan of it anyway. Yeah, yeah, exactly. Exactly.
What do you think the impact is going to be on Lobito itself? Like, maybe rather, let me rather say, how is like, if you know, from your perspective, how healthy is the Lobito, like commitment to Lobito looking from the US at the moment, because I saw that they were name checking, they didn’t seem to forget about it in that in that kind of that investment conference that you were mentioning, there was a lot of people kind of like talking about still talking it up. But then there’s a lot of these kind of details coming through where you’re like, Oh, I’m not sure how this is going to work. So yes, it’s not true.
GÉRAUD NEEMA: One thing that we’ve learned from the US Africa Business Forum that happened in Angola a few weeks back, that we do know that yes, they still remember Lobito Corridor, they still want to invest in the DFC still, you know, we’re still going to be there. They’ve also acknowledged that they were late. They haven’t disbursed any of the promised any of the money they promised so far that we do know that they say that no, we’re still going to make that happen.
We’re still working to make that happen. But between what they say and how it’s going to happen, I really not sure how things are going from that perspective. But what I know from different stakeholders on the ground, when you speak with them, they tell you the Lobito, the project, at least it’s viable, it’s economically viable, because the constraint that we do see around the transport that are taking place in the region offering an opportunity for the Lobito Corridor to be an option for mining companies.
If you can get to the ocean in like in seven days or 11 days than waiting for almost a month to get from the copper belt in Zambia to get into Durban, Lobito is still a winning option for you. It’s still a winning option for you. Of course, for Zambia, they’re going to still have to build up the greenfield, the greenfield portion between Angola and Zambia.
This, I think, the part where that can be now tricky, given the fact that if the money doesn’t come up, Zambia may not see the green line portion of the Bengula Railway to be built connecting Angola and Zambia to connect that to the railway. This is the only impact I can foresee if the DFC redraw its supporting or if it’s taking long to disburse the money that we’re expecting, that the consortium is expecting into this project. But as I’ve been telling people, the Bengula Railway is represented in the Lobito Corridor project, it’s economically viable, it makes sense.
Even if the DFC pulls away, I believe that we’re still going to see a lot of banks and institutions willing to pitch in and to put money on the table. And even foreseeing European banks being willing to do that, because let’s face it, the companies that are running the consortium are three European companies, Trafigura, Motengil and Vecturis. And they’re really making sense.
I do believe that, yes, even if the DFC pulls away, we’re still going to have some other companies. We may even see Chinese banking companies, Chinese financial institutions coming to the project and trying to make it work. But let’s not forget for this time here, the DFC is not alone in that project.
We also have the DBSA, which is also financing the consortium into that project. So for me, the Lobito Corridor, I won’t be worried about that much, even if the DFC pulls away or even Trump, you know, skyrocket the tariffs on corporate import to the US.
COBUS VAN STADEN: Yeah, for listeners who haven’t been following the story very closely, the DFC is a development finance corporation, a US government agency focuses on channeling investment into infrastructure projects, you know, overseas or other, you know, projects overseas. And the DBSA is the Development Bank of Southern Africa.
GÉRAUD NEEMA: Thank you for making that clarification. This is what usually what Eric does, you know, when we start bringing up all the acronyms and the truth, let’s not pretend that all our audience are familiar with the things that we follow here. So yeah, thank you for clarifying that.
It didn’t even occur to me, it didn’t even come into my mind that, you know, I didn’t, I didn’t even explain what the DFC is, or what the DBSA is. Really, thank you for doing that.
COBUS VAN STADEN: Yeah, no, we live in acronym country. Exactly. So staying in Southern Africa, in my own country in South Africa, they’re now dealing with and freaking out about the fact that it seems like they’re going to be dealing with 30% tariffs from the US.
So the US announced 30% tariffs, the South Africans say that they’re still negotiating, but they’re also saying that they’re not getting any answer from Trump officials. They’re saying they’re trying to kind of get through to them. But no, basically, no one’s answering the phone.
So now the country is kind of freaking out, you know, kind of because I mean, this, this is, you know, China is South Africa’s largest trading partner, but trade with the US is significant, particularly because some US companies are very heavily invested in South Africa company like Ford, for example.
GÉRAUD NEEMA: 300 of all of them, I think 300 also companies present in South Africa.
COBUS VAN STADEN: Yeah, exactly. So, you know, so Ford, for example, assembles cars in South Africa, and then ships them to the US. And so I’ve seen numbers that around 100,000 jobs on the line for, you know, because of, you know, due to kind of US South Africa trade issues.
And so like, we’ve seen, but what we’ve seen also in the same in the same week, is there was a huge artificial intelligence conference happening in China this week, like in Shanghai, like massive, like, I mean, the number of robots walking around in that exhibition, all was just crazy. The South Africans were there, like, they’re like, there were a lot of global self stakeholders there. But the South Africans were really there.
And they sent a huge delegation and the communications minister was like meeting and they set up all kinds of working arrangements with different Chinese companies, including Huawei with ZTE, like a whole, you know, different kind of like development kind of initiatives. At the same time, while that’s happening, South Africa is also in a fight with Taiwan. So they’re trying to party, I think, like largely due to pressure from China, they’re trying to downgrade the Taiwanese liaison office in Pretoria, and they’re trying particularly to force them to move to Johannesburg.
And so in response to become a trade office, exactly. In response, Taiwan is now threatening to withhold exports of microchips to South Africa. So there is this kind of like, you know, this is this big kind of AI fight now, you know, kind of like between where South Africa is kind of like stuck between the US and China, you know, kind of in these different, these different kinds of geopolitical situations.
So I was wondering what you make of all of this, like how it looks from your perspective.
GÉRAUD NEEMA: I have so many conflicting thoughts about that. I mean, when we see how things are unfolding right now in South Africa, you realise that South Africa just become the bad apple for the Trump administration related to Africa. There is a bill that’s discussed on the Hill where they want to sanction South Africa.
But they say the time for us to condone our friends that are still making friends with our enemies are done. We cannot keep on doing that. And South Africa cannot be considered as friends of the United States.
When you see all of that, you see how South Africa itself puts itself in the crosshairs of both Democrats and Republicans when it took on Israel and Gaza in the Gaza case. South Africa really made things quite difficult for it at the same time, because also adding up the Taiwan issue, which person I do believe that there’s no urgency, there’s no need of any kind of…
COBUS VAN STADEN: Why? Why did they pick that fight now? It’s like…
GÉRAUD NEEMA: Of all the things that you can do, why to put a fight with Taiwan over an office which basically has no impact? No one’s willing to go to South Africa. No one does that.
I mean, why? But somehow they decided to make it a centre point of the fight. I don’t know why.
But taking all of that into consideration, I just feel not sad for South Africa. I feel worried about South Africa, because let’s face it, I understand South Africa is not a big country, but South Africa isn’t also a small country. When I see all of that, I have the feeling South Africa is either holding or withholding its punches, or it’s not sure of how high it can fight or how high it can punch in this fight.
Because Naledi Pandor a few years back said it, just reminding South Africa is still key to US car manufacture and industry with all the palladium, all the minerals that South Africa is sending, the critical minerals South Africa is sending to the US. So when you have that in mind, when you see that you have a Trump administration with the transaction on mind and all of that, when you see countries running around trying to make trade deals around critical minerals in the United States, you realise South Africa, you are not that weak. You are not that weak.
You have leverage, you have enough leverage. You have political leverage, you have economic leverage, political leverage, because you can actually create a coalition on the continent to say, you know what, I’m bullied because I’m exerting my right to be a sovereign country who has the right to do business with whoever he wants to do business. You know what, they can do that.
But somehow you have South Africans freaking out, being worried about all of that, which makes things difficult. Before even me getting to the trade part of it, I want to get your sense on that. Why do you think that ANC is, I don’t know if you have the same reading than me, that the ANC is withholding its punches.
It’s kind of worried. It doesn’t want to fight back. It wants not a confrontation, but rather a trying to accommodate the Trump administration.
What do you make of it?
COBUS VAN STADEN: It’s an interesting question, because in some ways, some of the things they’re doing directly kind of antagonises the US, and then in other ways where they could put up a more forceful kind of pushback on key issues they haven’t, they’ve made a point of it of not putting in retaliatory tariffs on US goods. And so far, they’ve also haven’t even public at least, only very rarely have they even raised the possibility of stopping kind of mineral exports to the US, which would be significant. Because the thing is, so South Africa has two really significant points of leverage.
One is that in the mineral space, it has some of the largest deposits of manganese in the world. And also, I think about 90% of platinum family minerals. So this is like palladium, the different kinds of like, like using high tech applications.
So South Africa has a world unique kind of like deposits of those. And then South Africa also still sits and controls one of the world’s most important shipping routes, particularly if there is, you know, kind of chaos in the in the Red Sea, then all of the shipping, you know, kind of like goes past the Cape of Good Hope. So there’s this very significant leverage.
But I think South Africa is hesitant to fully play those cards, because that is like really kind of throwing down the gauntlet, you know, and I think the real thing, you know, I think they in the short term that they they are really trying to maintain all of these jobs, right, kind of and to not to not because because unemployment in South Africa is already really high. And I think that they particularly kind of worried about domestic unrest, because the economy is already not amazing.
GÉRAUD NEEMA: Do you feel do you believe that the GNU plays as a factor in the way to approach the situation?
COBUS VAN STADEN: I think so. So the the GNU is a governed of national unity, which is the ruling or the formerly ruling African National Congress party, which is was Nelson Mandela’s party that that that kind of came came into power after democratization, they were in power for 25 years. And recently last year, they lost their majority.
And they’re now in a coalition government with a kind of a centre right party, which is also culturally a lot closer to the US. And so, you know, kind of, so I think I think, like, there’s been a lot of kind of like, of gridlock within within the government of national unity. And I think it tends to kind of like produce a kind of an approach where there isn’t a very kind of clear point of view, you know, kind of where it’s a little bit of this a little bit of that.
And I think this kind of like mixed approach is probably I agree is, you know, is probably reflected in, you know, in the current situation with the US.
GÉRAUD NEEMA: But what do we also know that when you look into from the economic landscape, the majority of those who own the big business that’s going to be impacted by the US tariff in these wars are controlled by white people in South Africa, you kind of understand why they wouldn’t feel comfortable to see South Africa going to a fight from an ideological perspective, in a context where it can really put the business in danger.
COBUS VAN STADEN: Exactly. You know, the thing to remember about South Africa is like, it’s it’s an incredibly complicated culture, right? Because on the one hand, you know, in some ways, South Africa is like, classical, like, left wing internationalist, right, kind of like there’s a part of South African culture that comes from the kind of rootedness in that that world during the kind of cold, the kind of liberation forces of the Cold War, you know, kind of very close to Cuba, for example, like that, you know, those those kind of like that kind of culture. At the same time, South Africa is very fundamentally shaped by Anglo American culture, you know, so so the US and particularly the kind of the way that the US in the Clinton era really embraced South Africa, really shaped South African national culture. So now this big fight with the Trump administration is a kind of a national trauma, I think, for the country, because while they are economically very close to China, they’re not culturally very close to China, right, kind of, they’re not kind of like coming from the world as China in the way that a country like Vietnam does, right?
They are like, in a lot of ways, China is still quite far away for them and quite, you know, quite kind of anxious making in some cases, even when people are very excited about working with China. So this and they are very embedded, I think, still in this kind of Atlantic world. But now there’s this strong feeling in South Africa that the Atlantic world doesn’t want them anymore.
You know, so so it was interesting, this, the bill that you mentioned, you know, when we were talking within, you know, in CGSP, that, you know, kind of Eric was saying, like, you know, he can’t understand why South Africa is freaking out about the bill so much, because it’s coming as a form of kind of MAGA virtue signalling in the US, you know, kind of from someone who’s trying to, who’s trying to kind of like climb the MAGA ladder and from someone who’s kind of a little bit outside of the mainstream. And I told him, look, it, it doesn’t matter from a South African perspective, it doesn’t matter. It’s America talking.
And so they don’t make those distinctions. They only hear America talking. And what America is saying is, we don’t like you.
So you know, and, and the thing is also is that targeting land restitution and black economic empowerment and affirmative action, you know, as one of the key things that the US is complaining about in South Africa, you know, you can talk about how like the best way of doing that kind of that kind of reform, but you can’t get around the fact that South Africa, South Africa has to do this kind of reform, right, like 25 years after democratisation, the economy is still crazily skewed towards white people, right? You know, the majority of the population still find themselves excluded from the main economy. So this is a, an ongoing problem that is causing ongoing kind of like unrest in the country.
So yeah, this is the South Africa has to do something about it, you know, so it makes it very complicated. But I really don’t, I don’t really believe that the US really care about that.
GÉRAUD NEEMA: I don’t think they really care about the fact that, you know, land restitution, I think in this moment, the land, the white genocide conversation was really, really hot topic when Trump was still friend to Elon Musk. Now that they fall apart, I think, but they still have the geopolitical angle to it, where they blame South Africa for its connection with China, with Russia, and all of that, the Ukraine’s the, you know, the Gaza, all of that. We mentioned how much China is now main South Africa trade partner.
But do you see China being able to replace what the US is doing in South Africa? Do you really see China with abilities and the capacity, let’s be honest, the willingness to do what US is doing South Africa, in terms of economic investment and all of that?
COBUS VAN STADEN: I think it differs a little according to sector. So apparently there is already talks with Chinese EV companies to try and kind of like, you know, replace some of the US manufacturing in case people like Ford pull out. So in that kind of like in those kind of like narrow fields, maybe, but I think in lots of ways, they’re not replaceable kind of one to one, you know, so so for example, like the like, South Africa is one of the most sophisticated, like medical research sectors in you know, in in the global south, right.
And part of that is from decades long collaboration with US US institutions around particularly around HIV and TB research. So there’s no way of replicating those kind of networks out of nothing with China, right. China isn’t particularly a big player in some of those fields.
They’re not particularly interested in those fields in, you know, in some cases. So there’s very kind of like specific US South Africa collaborations that have essentially are that are basically going up in smoke at the moment and that aren’t really being replaced. And so I think that is what makes South Africa so anxious.
GÉRAUD NEEMA: I think it’s not like it’s gonna really get it’s gonna it’s gonna take time if ever China wants to replace us to one to one to what the US is doing in South Africa, it’s gonna take as you say, there is historical backgrounds, historical linkage, social linkage, where the South African society is much more anchored into the Western world and more into China. China is really trying to make its head ways in South Africa. But at the same time, you can also feel the angst in South Africa where they don’t want to find themselves isolated from the US in the way that China is the only option remaining on the table, which means that when you do have that you don’t have leverage anymore.
It means that your remaining and solely partner is going to be able to impose conditions on you knowing that you have no one else left. So I think this is something that South Africans are also considering, given that right now they still have this huge trade war between China and South Africa about who’s winning, who’s losing, and understand why South Africa is really trying not to break everything out with the US. But at the same time, I’m kind of wondering why they’re not pushing a bit harder, they’re not pushing back a bit harder to get a fair and better deal than what they’ve basically been given by the Trump administration.
This is really baffling to me, really. I don’t understand that. And I understand from a Chinese perspective, looking into that, I think that when I look at all everything, how African countries are caving to the US, they’re kind of wondering, maybe we’re the ones doing things too nice to Africans because at the end, they’re all caving into a bully.
COBUS VAN STADEN: I think so. I think on the other side, I think the South Africans will say, look, it’s fine for a country like Brazil to push very back quite aggressively, right, kind of because President Lula has been quite pointed, right, kind of in criticism of Trump. It’s different for a country the size of South Africa because it’s, you know, I think a lot of South African officials actually worried about is for South Africa to be basically turned into the new Iran, you know, like some country that is just permanently tainted as, you know, as a kind of an enemy of the US and just kind of get stuck in that position, you know, because for smaller, you know, developing economies, you know, they have so little leverage frequently in Washington that once that kind of consensus turns, it’s very difficult to turn it back.
So I think that that’s one of the things that they’re worried about.
GÉRAUD NEEMA: So they’re really trying to maintain certain equilibrium between the US and the US, China and the rest of the world. They’re still very much present into BRICS, they’re still very much active in everything that related to BRICS, some to BRICS event and all of that. And I’m really, I’m really wondering how they’re going to manage the G20.
G20 is coming and they’re going to have to manage all those different interests. I’m really, really curious how South Africa is working into making the EU voice heard and make is working into maintaining the equilibrium it’s maintained between China and its Western partners.
COBUS VAN STADEN: Yeah, absolutely. The other thing that I’m looking out for is when or how, you know, kind of like public perception of the US will turn in South Africa, there’s more and more, like prominent, you know, kind of people in South Africa have been talking about, you know, if there is massive job losses, then that kind of raises the possibility of social instability, you know, in South Africa, and, and then people have been kind of warning about about some kind of, like, you know, critical mass of kind of like anti US sentiment, you know, developing, developing in South Africa. I also don’t, I don’t believe I think it would take a while, if it would take a while, but it’s interesting to track, I think, I think we’ll see a massive anti ANC protest.
GÉRAUD NEEMA: I believe that the Democratic Party, the Democratic Alliance will feed the narrative that, you know, we are here where we are today, because the ANC was stubborn enough to bully and to go on a fight with the United States when it was not needed. And because the Democratic because this ANC wanted to make friends with unfriendly countries with countries we are not supposed to be friends with to begin with. So I think that’s going to be the narrative.
And I don’t think that South African society will turn against the US to embrace what Chinese culture, Chinese approach, Chinese identity, Chinese way of doing things, which is still new to them, and still unknown to them, despite they a strong Chinese diaspora in South Africa. But I really don’t see the mood changing, moving from the United States feeling toward a China sentiment.
COBUS VAN STADEN: Well, it may not necessarily be the one replacing the other, right? Kind of like, they could just simply be like, just mounting and mounting unhappiness more broadly, you know, like, I think one of the issues that that is interesting, and, you know, and kind of affecting South Africa beyond the specifics of the kind of narrow specifics of the relationship is how weak Europe has turned out to be in relation to the US, right? Kind of like Europe is folded, right?
And so, you know, so in that sense, the choice in Europe to not kind of like position themselves in a somewhat more independent kind of foreign policy position, I think is then also affecting the options of all of these other smaller countries that have traditionally very strong connections with Europe, like the way that South Africa does, you know, because South Africa, Europe relations, despite the fact that the US is culturally very, very strong in South Africa. So like, you know, South Africa, Europe relations are like have a much stronger, like historical legacy over, you know, over time.
So I think, you know, the choice in Europe to fully align themselves with the US to just absorb all of these things and not really push back, I think it’s also limiting options for all of these other countries as well.
GÉRAUD NEEMA: Now that you’re talking about that, it reminds me that I’m writing a paper on the future of US diplomacy, and I wanted to kind of tease your brain on that, since you mentioned Europe. When we see how the United States has been behaving under Trump, bullying, no playing nice anymore, no pretending that we’re nice people, but yet seeing partners and other countries are like literally caving in, folding to your demand. I now kind of wonder if Trump is not setting the tone of what would the US diplomacy would look like after him, in a sense where whether you have Democrats or Republicans in power, they’ve seen what Trump did.
It’s like, come on, we don’t need to play nice anymore. We have basically can tell people, we are the United States. You don’t do the way we want you to do.
And they cave in. And they’re all caved in. Except for China.
China was trying to build an alliance of countries to resist, but China is realizing that many countries are willing to cave into the United States and make any kind of concession, any kind of deal, just to be on the good side of the United States. So I’m really wondering if Trump is not really redefining the momentum of what the US diplomacy is going to look like after him. What do you think about that?
COBUS VAN STADEN: I think a lot of leaders that are coming after Trump are going to be taking lessons from this and feeling kind of, I think, like within the US, I mean, like, you know, like US leaders coming after Trump will feel empowered, I think, to be more bullying and to also to also not have to connect the cooperation with with kind of aid or other kinds of goals, right. At the same time, I also wonder if there may be a window that could close at some stage around around these issues, because one of the things that that we’ve seen, right, is that caving to Trump also doesn’t necessarily help you, right. So for example, the Philippines were threatened with 20% tariffs, and then they really played nice, it was super sweet with Trump and so on.
And then they came about away with 19%. Anyway, right, so it didn’t, it didn’t help.
GÉRAUD NEEMA: And then to be told that, you know what, you can be doing deal with China, China is a good friend of ours. And I was like, that’s a moment you feel that ridiculousness in the conversation. But you do have those kind of situation here.
COBUS VAN STADEN: Yeah, yeah. So in time, I wonder if like the Philippines, the UK, all of these countries that did go ahead and to make deals, if they then end up being if those deals end up not helping them anyway, then I wonder if there’s going to be a window where it’s suddenly people turn and don’t play as nice as they used to, right? I mean, they will we’ll have to see like, I think I think what will happen in the US midterms next year will definitely affect it.
But then also, I think more specifically how the tariffs are going to affect the world economy, I think that’s going to be the real the real test.
GÉRAUD NEEMA: Exactly, definitely, definitely. And I wonder if when those countries are going to stop to play nice if they’re going to be turning to China, because China is the only one who say, you know what, you play hardball, you’re gonna play hardball. I’m not going to try to sugarcoat things.
I’m going to play hardball with you. And let’s see, China has been postponing, they’ve been managing to postpone my 90 days, 90 days, all those tariffs, because they keep on negotiating, they keep on negotiating, because they still, you know, holding stick and bat, stick and carrot at the same time. And China was saying that, you know what, you don’t cave into a bully, you stand up to a bully.
And we see many countries are folding, are caving in. And I wonder really, at the end, if China will be able to say, you know what, I was right from the get go, follow me. I see many global South countries, African countries being able to do that.
But I don’t see European countries doing that. I know that there is a strong sentiment in Europe to be able to say, let’s carve our own way into this conversation. Let’s not ask a line with one or another.
Let’s ask being able to stand independently on that. But when you see how what Von der Leyen did a few days back in the US, that was really criticised in Europe, you really wonder if they’re going to have options to be able to stand to Trump, to stand to the Trump administration. Or as you say, maybe they’re just waiting midterms, hoping that the Trump administration is going to be fragile enough to be able to say, you know what, we have now a certain sense of equilibrium back in DC, we can have have partners with who we can talk.
COBUS VAN STADEN: I think there then the big question is, and I think a lot of no one wants to raise this issue, right. But the big kind of assumption there is that the US system, the US democracy will still function the way it always did, right. And I think, you know, like the next few elections, I think are actually going to be a test of that of that assumption, rather than, you know, we can’t necessarily just assume that things will be the same, right?
Kind of as they always did, as they always were.
GÉRAUD NEEMA: Exactly. We cannot, assuming that the world will look like the same with the US, with the same US since things have been changing. Corbius, it was really a pleasure to have this conversation with you.
Dear friend, you’ve been listening to us, it was a roundtable, a much more conversation between Corbius and I, trying to wrap up all different issues related to China, Africa, the US, you know, all the conversations that we do have. Those are the kind of conversations we do have with ourselves during our meetings, having those kind of conversations. We say, let’s bring those conversations to you so you can be part of our conversation today.
I really hope that you enjoyed this conversation. Don’t hesitate to drop comments. You know, it’s going to be on YouTube to subscribe, to be updated in every videos and new stories that we cover.
We have our EV shows with our colleague Jenga Akina. We have our colleagues in Jakarta. Edwin was also doing a great work.
We have people in South Africa, Cobuss, myself in Mauritius here. We have a larger team with people in Middle East. We’re going to open soon our Spanish edition.
We’re going to have an editor based in Latin America. We’re going to be covering China in the Global South, in Spanish, in Latin America. So if you know someone, if you’re really interested, if you know, you’re a journalist, you follow China in Latin America, you want to apply, don’t hesitate.
I think that you can apply. We’re going to keep your CVs. When we’re going to open the application, we’ll be really happy to have you in the team and to help us, you know, further the conversation around China engagement in the Global South.
Last week, Eric said, I’m not going to promise to say next week, but this week we managed to have our own roundtable, just Cobus and I. So I’m really hoping and really calling it out of the sky and say, I’m going to see you. We’re going to see you next week for another roundtable of the China in the Global South.
See you.
