China as a strategic partner for Sudan – what are the commonalities?


Dr. Adel Abdel Aziz Al-Faki

China is the largest global economy on the planet, with a gross domestic product in purchasing power of $25.7 trillion, according to the World Facts website issued by the US Central Intelligence Agency and available on the Internet. The Chinese object to the American classification and say that they are the second economy after the United States, not the first economy! The explanation for this is the United States’ desire for the value of the Chinese yuan against other foreign currencies to be stronger than the value currently imposed by the Chinese authorities, which is the value that allows Chinese goods to invade American markets due to their cheap prices and quality
The concept of strategic partnership includes coordination, cooperation and support in the political, military, security, economic, scientific, cultural, environmental and humanitarian fields. It is a concept that is based on these pillars combined and not on the concept of partnership or economic cooperation alone.

China has become a leader in the global economy, as it ranks first in terms of the size of the gross domestic product, as we explained. China has the world’s largest reserves of gold and foreign currencies, worth $3.9 trillion. China is the first producer of electrical energy with a size of 5.7 trillion kilowatts, and it is also its number one consumer with a size 5.5 trillion kilowatts.

China is the first country in the world in terms of agricultural and industrial production, and its exports amount to 2.3 trillion dollars as the largest exporting country in the world, while it imports worth 1.7 trillion dollars as the third country in the world after the United States and the European Union. The labor force in China is 806 million people, the largest labor force in the world, while the unemployment rate is 4.1% and inflation is around 2%. While Chinese foreign investments amount to about one billion four hundred trillion dollars, ranking tenth among the countries of the world.

Sudan, as a poor country, despite its enjoyment of enormous primary resources, needs someone to support it and support it economically from major countries. Many poor countries and less developed countries have become developed economies or at least medium-developed countries as a result of their embrace by a major country. There are many examples. In South Korea, Mexico, and Singapore, the economy revived with very huge investments from the United States. Malaysia has received huge investments from Japan and China.

China is considered the most suitable country for Sudan to conclude a strategic economic partnership with. Firstly, for the mutual respect between the two peoples, secondly because China does not impose any political conditions in exchange for its development loans, and thirdly because of China’s previous experience with Sudan in the field of investment in oil extraction, and in trade between the two countries.

The Sudanese economy is currently facing very major problems, namely the destruction of infrastructure due to the war, which has caused an increase in the trade deficit, stagflation, a deterioration in the value of the Sudanese currency, and a loss of confidence in the banking system.

Getting out of the crisis requires one of two options. The first: massive support for the balance of payments from international financial institutions or friendly countries, with no less than ten billion dollars as an initial payment. With development aid of no less than five billion dollars annually for at least five years. It is clear that the chances of achieving such support are very slim due to the position of the United States and the European Union countries, which have great influence on decisions in international financial institutions.

The second option: Implementing the strategic partnership agreement with China, including the use of the Chinese yuan in Sudan’s foreign trade exchanges, and in internal dealings as a second currency alongside the Sudanese pound.

Since relations between countries are based on interests, some may wonder about the reasons that push China to enter into a strategic partnership with a country that is at war and finds difficulties in dealing with the international community.

In fact, Sudan is looking for a country with great economic potential to help it unleash its potential, while China seeks to use its surpluses to invest abroad in order to advance in the list of countries that invest abroad, and to provide energy and food to its huge population, which is estimated at about one and a half billion people as the largest population of any country. One in the world.
In the post-war stage, we need large foreign investments, investments from companies from countries such as the Chinese CNBC, the Indian company, or the Egyptian army companies in the field of construction, roads and bridges, as such companies are not afraid of working in unsafe environments because they are companies that work to achieve strategic goals. We have experience with the Chinese company CNBC, which worked in the field of Sudanese oil in areas where war was raging between the Sudanese army and the SPLM army, so it was not afraid to work in a fragile security environment.

It is noteworthy that during the year 2013, the People’s Republic of China approved Sudan’s proposal to open a special account for the government of Sudan in the Chinese yuan with Chinese banks, allowing the yuan to be used in trade with them instead of the dollar and other international currencies.
There is now a tremendous opportunity to activate this agreement to implement the use of the Chinese yuan in trade with China. This implementation will help alleviate the pressure on the Bank of Sudan, which is now suffering greatly in providing foreign currencies for imports, because it does not have sufficient reserves.

Accelerating the implementation of the agreement with China regarding the use of the yuan in trade exchanges with it is considered a very appropriate solution in light of the conditions that the Sudanese economy is currently suffering from, and it would be desirable if serious action were taken by the Bank of Sudan to implement the agreement immediately, for several reasons, the most important of which is that China is the partner. Sudan is the number one economy in the fields of exports and imports (excluding the UAE, which is considered merely an intermediary between Sudan and China), and it currently occupies the list of the largest investors in Sudan, and it also occupies the top list of lenders to Sudan through the preferential loans it has provided and intends to provide to Sudan. Most important of all for Sudan is that the use of the yuan in exchanges will not entail the imposition of political conditions, and does not require passing through Emirati banks, nor through the New York Stock Exchange, as is the case with the dollar.

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