Economic Themes (2023) 61 (2) 3, 171-196
Sanela Mrdaković, Miloš Todorović
Abstract: China’s investment activities and infrastructure development in Africa within the Belt and Road Initiative (“BRI”) have changed the prospects of economic cooperation between the African countries and Asia’s largest economy. Africa plays a prominent role in one of the key BRI corridors, which is why China is actively engaged on the continent through the construction of hard infrastructure, port development and trade and investment activities. China is Africa’s largest bilateral trading partner and foreign direct investor. This paper analyses China’s investments and trade flows with Africa, the relevance of African countries for the BRI and ChinaAfrica relations within the geopolitical triangle US-EU-Russia. We applied the correlation analysis to assess the intensity of the relationship between FDI and trade and an autoregressive model to extrapolate import and export data for a given period with the aim of forecasting trends in the development of China - Africa economic relations. The empirical results indicate a strong correlation between China’s FDI to African countries and their trade flows. The autoregressive model estimates a substantial increase in their trade flows, which, along with China’s infrastructural development in Africa, suggests a change in the dynamics of their trade cooperation and in the geographical structure of African countries’ foreign trade.
Keywords: China-Africa economic relations; BRI; Silk Road; Chinese FDI in Africa
CHINA - AFRICA TRADE AND INVESTMENT RELATIONS WITHIN THE BELT AND ROAD INITIATIVE
Sanela Mrdaković, Miloš Todorović
Abstract: China’s investment activities and infrastructure development in Africa within the Belt and Road Initiative (“BRI”) have changed the prospects of economic cooperation between the African countries and Asia’s largest economy. Africa plays a prominent role in one of the key BRI corridors, which is why China is actively engaged on the continent through the construction of hard infrastructure, port development and trade and investment activities. China is Africa’s largest bilateral trading partner and foreign direct investor. This paper analyses China’s investments and trade flows with Africa, the relevance of African countries for the BRI and ChinaAfrica relations within the geopolitical triangle US-EU-Russia. We applied the correlation analysis to assess the intensity of the relationship between FDI and trade and an autoregressive model to extrapolate import and export data for a given period with the aim of forecasting trends in the development of China - Africa economic relations. The empirical results indicate a strong correlation between China’s FDI to African countries and their trade flows. The autoregressive model estimates a substantial increase in their trade flows, which, along with China’s infrastructural development in Africa, suggests a change in the dynamics of their trade cooperation and in the geographical structure of African countries’ foreign trade.
Keywords: China-Africa economic relations; BRI; Silk Road; Chinese FDI in Africa
