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Published on December 11, 2007

A high-level seminar was told China, Singapore, India and even Vietnam had firm footholds on the African continent and that the time was ripe for a similar move by Thai businesses.

Botswana's ambassador to Thailand, Oscar Motswagae, told the seminar, entitled "Doing Business in Africa" and organised by the Asian Institute of Technology (AIT) and the Foreign Affairs Ministry, that Africa was a large continent with pockets of rapid development.

"There are 53 countries in Africa, and they are different in many ways," the Tokyo-based ambassador said. "Although there are conflicts, coups and other kinds of problems, not all countries suffer from them."

Despite security problems, the big investment players do not balk, said the charge d'affairs at Bangkok's Nigerian Embassy, Fola Aiyedun. He said China shrugged off wars and terrorist attacks on the Niger River Delta refineries.

Therefore, Thai enterprises should make their marks before it is too late, advised the first secretary to the Foreign Affairs Ministry's African Division, Soradjak Puranasamriddhi.

A point at issue in the seminar was a claim on BBC Radio's Global Business that China, which is Africa's third-largest trading partner after the US and the EU, invests more in Africa than in the whole of the developed world.

Vijay Joshi, a fellow of Merton College Oxford and former adviser to the Indian government, said Chinese foreign direct investment to African would total US$50 billion (Bt1.68 trillion) this year.

Thailand cannot compete in volume, Soradjak told the seminar.

China's Export and Import Bank alone has made loans of $2 billion to Angola's oil industry, said Augusto Garcia of the University of Macau. But only 30 per cent of the profits resulting from that investment remain in Angola once the oil is shipped east, and Angola is not really benefiting from it, he said.

"One strategy that Thailand can adopt is to help Africa develop," Soradjak said.

Doing business with a development bent is no charity work. But to seal such deals in Africa, Thai businesses would have to incorporate into their strategy a way to add value to their investments.

With gross domestic product growth of 5.7 per cent this year, Africa continues to rely on its mineral riches, nine of which generate almost 90 per cent of all revenue, said Sam Cho of the UN Economic Commission for Africa.

While the continent's commodities have benefited from high prices as a result of demand from China and India, industrialisation has flown by. Cheap clothes from China, for instance, made Africa's first step into light industry impossible.

Thailand could be an alternative to Chinese investment, said Roland Amoussou, project manager for AIT's Asia-Africa Initiative.

Motswagae said Botswana, which has the world's largest reserves of diamonds, offers tax incentives to investors who transfer knowledge to the local workforce.

Pairoj Rangponsumrit of PPT Exploration and Production said knowledge transfer had worked well between developing economies. In a consortium with other energy firms, his company has secured four drilling blocks in Egypt and Algeria and sponsored two scholarships in Gambia.

Ki Nan Tsui, The Nation