9. China's Telecommunications Footprint in Africa - Institute of ...

Compared to the established Western telecom gear-makers, Chinese ... For instance, the number of mobile phone subscribers in Africa hit 280 million in May ... Library ContactUs Sitemap JETRO aaAA Language Japanese English 【ByRegion】 Asia MiddleEast/CentralAsia Africa LatinAmerica 【ByTopics】 Economic Skills:IntellectualPropertyRights PublicFinance Microfinance InternationalInput-OutputAnalysis SpatialEconomics Society Education,HumanResources Gender Globalization:CultureandSociety SocialSecurity PovertyandInequality Health Politics AfricanPolitics SocialMovements PoliticalPartiesandElections ConflictandPeace-building Democratization Law LawandInstitutions Research Research Researchactivityand projectoutlines ResearchProjects ResearchNetworks Seminars&Events ResearchPrinciples Papers&Publications Papers&Publications Publicationsearch Newbooks Newjournals Newreports Books Journals&Magazines Reports Researchers Researchers AlphabeticalOrder ByRegion ByTopic ByDepartment VisitingResearchFellows AboutIDE AboutIDE MessagefromthePresident Location OutlineofIDE Inquiries Fellowships/JobOpenings Data&Resources InstituteofDevelopingEconomies>Data&Resources>AGE(AfricanGrowingEnterprises)File>Manualreport>9.China'sTelecommunicationsFootprintinAfrica-ChinainAfrica-AGE(AfricanGrowingEnterprises)File Data&Resources AGE(AfricanGrowingEnterprises)File SearchResult-AGE(AfricanGrowingEnterprises)File Category Company Country Manualreport AboutGeo-EconomicDatasetForAsia Input-OutputTables(Download) HouseholdDataonMicrocreditStudyinIndonesia TradeIndexNumbersforUnitValue,Value,QuantityandTermsofTrade AfricanPage ManualReport CSRReport BOPReport ChinainAfrica ChinainAfrica 9.China'sTelecommunicationsFootprintinAfrica China’sincreasedinvolvementintheAfricantelecommunicationsindustryispartofamultidimensionalengagementinthecontinenttoserveitsbroaderstrategytoenhanceitsglobalstanding,counterWesterninfluenceandtoobtainresourcesandnewexportmarketstofeeditsrapidlyexpandingeconomy.Alongsideconstruction,energyandmining,telecommunicationsisoneofthefourstrategicpillarsunderpinningChina’seconomicdevelopmentandprovidingthenecessaryplatformfromwhichtochallengetheWestforglobalhegemony. ItisthereforeregardedavitalindustryforChinesestrategicinterestsonseveralfronts: Acquisitionofforeigntechnology Dualusemilitaryapplication ReinforcingChina’sspaceandsatellitedevelopmentprogramme Breakingintonewmarkets. SuchassessmentsarecloselydrivenbytheChineseCommunistParty(CCP)andrelatedministerialandstrategicplanninginstitutionswhichhaveastheirprimarymandate,theemergenceofcompetitiveinternationalcompaniesalignedwiththestrategicpoliticalconsiderationsofthemotherland.Importantly,ChinesetelecomcompaniesdonotoperateinisolationbutoperateintandemwithChinesegeo-strategicobjectives.ThismakestheneedforeffectivecountervailingstrategiesallthemoreimportantindealingwithChinesetelecommunicationschallengeinAfrica. InitialassessmentssuggestthatChinahaschosenseveralhubsfromwhichtoroll-outitstelecommunicationstrategyonthecontinent.TheseincludeEgypt,Algeria,TunisiaKenya,NigeriaandSouthAfrica. LeadingthepackareChineseheavyweightcompaniessuchasHuaweiTechnologies,ZhongxingTelecomLtd(ZTE)–bothlinkedtotheChinesemilitaryandintelligenceestablishments,ChinaTelecom,andAlcatelShanghaiBell(ASB).Improvingtechnicalcapacity,linkedtolowcostsofproduction,accesstocheapstatesubsidizedfundingsourcesandstatepoliticalsupportprovidesuchcompaniesanimportantcompetitiveedgenotavailabletoindependenttelecomcompanies. 9.1.TheChineseBusinessMethod ThelinksbetweentelecomdealsandChina’sAfricanstrategyarenotnew.AccordingtoMarkNatkin,managingdirectorofBeijing-basedITandtelecomconsultancyMarbridge:“Chinesetelecomvendorshaveidentifiedopportunitiesindevelopingnationsandcanleveragetheirpriceadvantagetodeveloprelationshipsthatvendorsfromrichcountriescan’tbebotheredwith.Chinaistakingamuchlonger-termapproachthatbetterintegratesbusinessandpoliticalobjectives.Ifyou’rethecompanythatgetsinthereandbuildsthecorenetwork,youhaveagoodshotatwinningallupgradecontractstofollow.It’slikebettingonaportfolioofhigh-riskstocks.Manywillbelosingpropositions,butthosewillbeoutweighedbythefewthattakeoff”. Importantly,Natkinadded:“Itmightbecoincidental,butmanyofthetelecomdealsdonebyChinesevendorsinAfricaandotherdevelopingcountrieshavebeenwithoil-producingcountries”.PartofChineseeconomicpenetrationstrategiesintonewmarketsistoletChineseoilcompaniesactasthevanguardofChinesebusinessandlaterpoliticalinterests.Chineseoilcompaniesallowforlow-levelintrusionintonewmarketswithoutattractingunnecessaryattention.Buttheyinevitablyheraldaninfluxofgovernmentofficials,mainlyfromtheintelligencecommunity,tohelpassessbothbusinessandpoliticalopportunitiesinsuchcountries.ThishasbeenespeciallyevidentincountriesinAfricawhichhavenothaddiplomaticrelationswithBeijing,mostnotablyChad(priorto2006)andSaoTomePrincipe. ComparedtotheestablishedWesterntelecomgear-makers,Chinesecompaniesoffermorecost-effectiveequipmentandsolutions.Inaddition,accordingtoZhouTao,executivevice-presidentofASB,theChineseGovernment'sincreasingfinancialsupporttoAfricancountriesisalsogivingaboosttotheestablishmentoftelecominfrastructure. TheChinesegovernment’srolewasunderlinedin2004whenDeputyMinisterofCommerceChenJianstated:“ChinawillfurtherexpandtelecomcooperationwithAfricannationsinlinewithmutualbenefitsandcommondevelopment.Moreover,theChinesegovernmentwillsupportitstelecomenterprisestorunmoretelecomservicesinAfrica."ThisinanutshellexplainsthecoreoftheChinesetelecommunicationstrategyinAfrica. SomeimportantstrategicindicatorsunderliningthebusinessthreatposedbyChinesetelecomscompaniesarethefollowing: Asaresultofgovernmentsupportforitstelecommunicationcompanies,Chineseflagshipcompanies,HuaweiTechnologies,ZTEandASBcankeeptheirpricesextremelylow,andtailor-makesolutionsforpoorAfricancountries.CriticsofZTEandHuaweipointoutthattheysellcheaplytotroubledgovernmentsliketheregimesinAlgiersortheSudanindealsthateffectivelyamounttoforeignaid,andwiththefullsupportoftheChinesegovernment.Forexample,becauseofits“nationalchampion”statusinChina,ZTEcanobtainlowcostmoneythatitcanthenlendtoitsowncustomers.LoansforAfricancontractsarebeingencouragedviapreferentialloansfromgovernmentbanks,whichamounttoadefactosubsidy.Moneyisfunneledthroughlendingchannels,viapreferentialloansfromtheChinaEx-ImBank,throughtheChinaDevelopmentBank.[Seebelow.]AccordingtoRussellSouthwood,CEOofBalancingAct(aconsultingfirmandonlinepublisherspecializingininternetandtelecomsinAfrica)allmajortelecomsequipmentprovidersengageincustomerfinancing,butinZTE’scasethereisnotransparencyincustomerlending:“Notonlyaretheyofferingpreferentialloans,butit’simpossibletotellwhatadd-onsbecomepartofthepackage.They’relikelytosay‘ifyouwantsomethinglikeExtraDepartmentalBranchOffices(EBDO-a3Gmobilevoicetechnology),we’llwrapitintotheprice,’”explainedSouthwood. Chinesecompaniesestablishthemselvesaskeysuppliersearlyinthedevelopmentofeachmarket.Theythenpositionthemselvestowinsubsequentnetworkupgradesaseconomiesimprove.Theyalsogainanopportunitytoshowcaseandrefineitsmoreadvancedtechnologies-forexample,Wideband-CodeDivisionMultipleAccess(WCDMA)networksdeployedinTunisiaandLibya.Countriesareconcernedmoreaboutpriceandlessabouttrackrecords.Leveragingtheirexperienceinthesemarketsandaddinglow-costAfricanproductionfacilitiestoreducefreightexpenses,thecompaniesthuspavethewayforfutureexpansioninAfrica. ChinesecompaniescanofferservicesandproductsatafractionofthecostoftheirWesterncounterpartsbecauseoftheabundanceoflabourandlowpayingsalaries.Forexample,Chinahasanannualturnoutoftwomillionengineeringgraduates,whileFrancehas300000andGermanyjust100000.However,averageannualsalariesofengineersinChinaonlyamounttoUS$19000peryearasopposedtoroughlyUS$110000inGermanyandFrance.Likewise,Chineselabourerswork50hoursonaverageperweek,whereasFrenchandGermanlabourerswork38hours. AccordingtoChineseofficialsfromMinistryofInformationIndustry(MII),China,asadevelopingcountry,hassimilaritieswithdevelopingcountriesinAfricaandenjoysarichexperienceinICTdevelopmentfromtheperspectiveofadevelopingcountry.ThedirectorsaidthatAfricaneedsallkindsofcapacitybuilding,suchasthetrainingforbothstudentsandteachers,andcapacitybuildingande-learningareakeyfactortopromotethedevelopmentinthecontinent. InWestAfrica,companiesintheareasaytheyfindprocuringequipmentfromChinesecompaniesattractiveforanarrayofreasons.Forinstance,ZTEofferedthebestproposalintermsofpricewhenKasapaTelecomLtd.,asubsidiaryofHutchisonTelecomandoneoffourmobileoperatorsinGhanawantedtoprocureequipment."Fivevendorssubmittedproposals;twoChineseandthreewerenot.ZTEwononthebasisofprice,speedandserviceanddemonstratedcommitment,"accordingtoRobertPalitzManagingDirectorofKasapa.Hefurtherelaborated:"Wehavetheabilitytodirectthegrowthofthenetworkoverthecontractperiodsothatwecanquicklyrespondtomarketplaceconditionswhilebenefitingfromthepricesnegotiated.Thevendorincludesquality-of-serviceparameters.” AskedabouttheoutlookforChinesetelecomequipmentvendorsinAfrica,Palitzsaid:"Ican’tpredictbutcertainlythenon-Chinesevendorshaveachallengetomeetinmarketswhereincreasedpenetrationwilldependonlowercostspersubscriber.AstheChinesevendorsbecomemoreexperiencedinprojectmanagementoutsideChina,thehistoricaladvantageofoldervendorsmaydiminish." ZhouTao,executivevice-presidentofASBstatesthatChineseGovernment'sincreasingfinancialsupporttoAfricancountriesisgivingaboosttotheestablishmentoftelecominfrastructure.TheExport-ImportBankofChinagrantedASBfinancialassistanceofUS$63,3millionin2004toaiditsoverseasexpansion."AsChinaandAfricancountriesbuildsolidpoliticalmutualtrust,AfricancountriesarewillingtogetChinesecompaniesinvolvedinmoreinfrastructureprojects,"saidZhou."WebelieveChinesetelecomequipmentmakerswillhaveevenbiggerbusinessopportunitiesinAfricainthefuture." AccordingtoVictorYip,ananalystwithUOBKayHianSecuritiesinHongKong:"DoingbusinessinChinahastaughtZTEandHuaweitofocusonkeepingtheirproductssimpleandcheap.Peopleindevelopingmarketsdon'tneedfancy(sic)-theywantsomethingthatworks." AccordingtoRichardWindsor,communicationsequipmentanalystwithNomura,oneofthegreatestthreatsthatAsian(ChineseandIndian)mobileterminalmanufacturersposetotheirUSandEuropeancounterpartsistheircomparativeopennesstothesocalled‘whitelabel’phonemodel,whereoperatorscanbrandthemobilephoneastheirownorothervendorscanpurchasecomponents(fromtheAsianmanufacturers)tomaketheterminalthemselves.DuncanClark,chairmanofBDAConsulting,atelecomsresearchfirmbasedinBeijingstatedinthisregardthat“ZTEiswillingtoforgoitsbranding,gothewhitelabelapproachandcustomizetowhatoperatorsandcustomerswant.” AccordingtoShiLirong,seniorvicepresidentofZTE,onereasonwhyagrowingnumberofserviceprovidersinEuropeandNorthAmericaareforgingnewpartnershipswithChinesesuppliersisbecausetheirrelationshipswithtraditionalpartnersarefailingtodeliver:“R&Dcost-cuttingexercisesoverrecentyearsmayhavelostWestern-basedtelephonyequipmentmanufacturers-includingLucent/Alcatel,Nortel,Siemens-theirtechnologicaledgeinthemarketplace,”hesays.“However,thestoryisradicallydifferentforChineseequipmentmanufacturersthathavesofarconcentratedsaleseffortsondevelopingareas.Wehaven’thadthoseproblems,”hesays.“Therewasnobubbletoburstinthesecountries,sothetradingenvironmentisnormal.Marketinvestmentisstillincreasing.ForR&Dinvestmentthereisnoproblem;wearestillincreasingbudgets.” FinallyChinaisalwayscarefultoengagepotentialclientsatthehighestpossiblelevel.Amacro-strategicinterventionapproachiskeytowinningoverthepowerelites,whichwillbuyintoanyproposedbusinessplan.OnlythendoChineseofficialsworkdownthefoodchaintoengagewithlocalparastatalsandbusinessman,unlesstheyarealsowellconnectedtothepowerelites. 9.2.TargetedCountriesinAfrica ThetopAfricantelecommarketsforChinesecompaniesareAlgeria,Egypt,Tunisia,MoroccoandSouthAfrica,comprising60percentofChina’stotaltelecomassetsonthecontinent.Outsideofthese,onlyNigeriaandAngolaarebecomingtrulysignificant.OfimportancehereisthatChinesetelecommunicationdevelopmentsinAfricahaveinitiallyfocusedoncoastalcountries–thosethatstrategicallystraddlemainshippingroutesandstrategicchoke-points–knowninmilitaryparlanceassealanesofcommunications(SLOCs).Trackingshippingmovements,especiallyintimesofwar,suggeststhatChinesetelecominvestmentsinAfricacloselyfollowglobalstrategicconsiderationsoftheCCPwhenitlooksattheglobalnatureofitstelecommunicationsstrategy.Itisofcoursenotthesolemotivatingfactorforitsinvestmentdecisionsrelatedtotelecoms,butitisasignificantone. Asecondtierofcountriesarethosewhichprovidemarketaccessorspringboardsforinvestmentintootherregionalsectorsofthesub-continent,orwhicharerichinenergyandnaturalresources,criticalforChina’seconomicgrowthprospects.Inthefirstinstance,Kenyaisausefulexample,givenitsstrategiclocationinEastAfrica.SudanisanexampleofthesecondinstancewhereitsoilrichesprovideChinawithover300000barrelsofoilperdayorsome7to8percentofitstotaloilimports.Othersecondtiercountriesinclude:Angola,Ethiopia,Ghana,IvoryCoast,TunisiaandZimbabwe. ThereareimportantmilitaryandsecurityconsiderationslinkedtoChina’spenetrationoftheAfricantelecomsmarket.Forexample,themostimportantmainfixedbaserelatedtoBeijing’sspaceprogrammeoutsideofChina,entirelymannedbyPRCtechniciansandbuiltwithBeijingmoneyandtechnology,isthecoastalNamibiatrackingstationinSwakopmund.Chinesecompaniesresponsibleforthemoresensitiveconstructiontasksincluded:ChinaGreatWallIndustryCorp(CGWIC);ChinaStateConstructionGroup,Windhoek;ChinaAerospaceMachineryandElectronicsCorporation(CAMEC);andChinaAerospaceInternationalHoldingLtd(CASIL). 9.3.TheRoleofTelecomsAlliancesinAfrica LookingatthepatternofChina’spenetrationoftheAfricanmarket,thefollowingemerges: Chinesefirmswilllinkupwithglobaloperatorstoa)piggybacktheirexistingnetworkstoselltheirproductandservicelines,andb)useaslaunchpadstopenetrateandentrenchthemselvesinnewmarkets. Linkupwithlocaltelecomcompaniestoaccesspoliticalleveragetoclinchdealsintargetedcountries. Link-upwithfellowChinesecompaniestocompeteagainstforeigncompaniesforcontracts. AvoidJVswithnon-Chinesecompaniesintheabsenceoftheabovecriteria. Againstthisbackground,theopportunitiesintheAfricanmarketareobvious.Forinstance,thenumberofmobilephonesubscribersinAfricahit280millioninMay2008(comparedto76,8millionin2004andjust7,5millionin1998)representingamarketpenetrationrateofover30percent.AllthemajorChinesecompaniesalreadyinvolvedintheAfricanmarkethavecategoricallystatedtheirintenttofocusonAfricaforfuturegrowth.Keytotheirfuturestrategyinthemarketwillremaincompetitivepricing,theexpansionofwirelessconnectionsandpartnershipswithmajorwesterncompanies. TheAfricanenvironmentenjoysapositiveoutlookasfarasthewirelessmarketisconcerned.3Gserviceshavebeencommerciallyavailablesince2003inAfrica.Further3Glaunchesareexpected.ZTE’sexcitingTD-SCDMAsystemisdestinedfortheAfricanmarketafterpassingtestswithflyingcolourslastyear.ItwassuccessfullytestedattheBeijingOlympics,whereZTEwasthelargestsupplierofTD-SCDMAhandsetsfortheOlympics.Thecompanysuppliedabout30percentofthepurchaseorderplacedbyChinaMobile,thusmakingthecompanythebiggest3Gproviderofbothnetworkinfrastructureandhandsetsoftheglobalsportingevent.ThehandsetdivisionwasoneofZTE’sfastestgrowingunitsin2007,withyear-on-yearsalesrevenuesgrowingby69,16percentshippingover30millionhandsetsin2007. 9.3.1.SelectedImportantPartnersandContracts LookingattheroleplayedbyforeignalliancesinChina’sentryintotheAfricanmarket,thefollowingisnoted: InDecember2006ComptelCorporation(AleadingHelsinki-aleadingOSSsoftwarevendorforconvergentmediation,charging,provisioningandnetworkinventory)wasselectedbyHuaweiasaqualifiedpartner.ThismeansthatComptelisapreferredHuaweipartnerforthedeploymentofmediation&provisioningservicestoitscustomers.HuaweiandComptelhavealreadydeliveredjoint-projects,includingaCDMAVoice,DataProvisioningandMediationsolutionforTelecomNamibia. [Note:TheComptelInstantLinkprovisioningsolutioncoversalltheprocessesfromacceptinganordertoactivatingabillableservice.ItinteractswithHuaweiequipment,allowingserviceproviderstoactivatenewcustomersandservicesfastandefficiently.ComptelEventlinkisaconvergentmediationsolutionthatisdesignedtocollectandprocessusageinformationfrommanydiversesources,includingHuaweinetworkelements,andforwardthemtobillingsystems.] ComptelhasbeenpresentintheMiddle-EastandAfricaregionsince1997includingcountrieslikeSouthAfrica,Namibia,Nigeria,Ghana,Morocco,Sudan,Oman,UAE,Qatar,Pakistan,JordaniaandSaudiArabia.Comptelwasestablishedin1986andislistedontheHelsinkiStockExchange(CTL1V)inFinland. InOctober2006EmiratesTelecommunicationsCorporation("Etisalat")selectedHuaweiasitsmajorsupplierfortheconstructionofitsnationwideUMTS/HSPAnetwork.Underthe3-yearcontract,HuaweiwillprovidethenewgenerationUMTSequipmentincludingmorethanonethousandNode-Bbasestationsfortheconstructionofanationwide(UMTS/HSPA)network,whichwillbethefirstHSPAnetworkbasedonIub/IP(InterfaceUMTSB/InternetProtocol)transmissionintheMiddleEastandNorthAfrica.HuaweihasbeenworkingwithEtisalatsinceDecember2003forthelaunchofitscommercial3GservicesintheUAE.Etisalathasnetworkscoveringmorethan14countriesincludingEgypt,SaudiArabiaandSudan.EtisalatisalsoinvolvedwithTheEastAfricanMarineSystems(TEAMS)initiative,whichaimstoprovidemoresubmarinecablelinkstothecontinent,particularlyEastAfrica. EtisalatrepresentsanimportantcoginHuawei’songoingexpansionplansinbothAfricaandtheMiddleEast.Forexample,in2006aconsortiumledbyEtisalatwontherightstodevelopEgypt'sthirdmobilenetwork,withawinningbidof2,29billionEuro.ThenetworkisbeingbuiltjointlybyEricssonofSwedenandHuaweiatacostofapproximatelyUS$1,2billion.Theventure,EtisalatEgypt,competeswithexistingserviceprovidersVodafoneandMobinil. DuringtheFinancialTimesTelecomWorldeventheldinLondon,inNovember2007EtisalatCOOAhmedAbdulkarimJulfar,confirmedthatthecompanyhasfurthermajorexpansionplansinAfrica. [Note:EtisalatranksamongtheFinancialTimesTop500CorporationsintermsofmarketcapitalizationandisthesixthlargestcompanyintheMiddleEastintermsofmarketcapitalizationaccordingtoLondon-basedmagazine,TheMiddleEast.] HuaweiwasselectedbySouthAfrica’sMTN,whichisthelargestmobileoperatorinAfrica,asastrategicpartner.MTN,whichisoneofthelargestcross-nationalmobileoperatorsinsouthernAfrica,selectedHuawei'sGSMBaseStationSub-System(BSS)tosupportitsGSMexpansionprojectinordertomeetAfrica'sincreasingdemandformobileservices. Inlate2006HuaweiwasselectedbyComiumMobiletobuildaGSMnetworkinCoted'Ivoire.ThecontractincludesprovidingafullturnkeyGSM,GPRS,3GandIntelligentNetwork.TheprojectadoptedHuawei'sEnerGGSMsolutionandnewgenerationGSMDualDensityBaseTransceiverStation,orBTS.ComiumMobileselectedHuaweiasaresultofasuccessfulthreeyearpartnershipwithHuaweiinSierraLeoneandLiberia,todeploytheGSMnetwork.[Note:ComiumisaggressivelypursuingtheacquisitionofnewlicensesacrossWestAfrica.ComiumMobileisafullyownedsubsidiaryoftheComiumGroupLuxemburg.InadditiontotheIvoryCoast,ComiumislicensedtocarryoutGSM900/1800,InternationalVoiceandBroadbandWirelessInternetservicesinLiberiaandSierraLeone.Itoffersintegratedmobileandtelecomservicescomprisingofpost-paidandprepaidvoicecommunications,value-addedservices,SMS,andsecurehighspeedInternetAccess,togetherwithlowcostalternativeInternationalcallingcardservices.] In2006OasisSprl,theCongoleseoperationofMillicomInternationalCellularawardedHuaweiaturnkeycontracttoprovideanewGSMnetwork.Underthefirstphaseofthecontract,HuaweisuppliedandinstalleditsHuaweiEnerGGSMtechnicalplatformanddeployedmorethan500basestationsacrossthecountry.ThenetworkoffersvoicecommunicationaswellashighspeedInternet,videoondemand,MMSandelectronicpayments.Theinitialphaseofthenetworkcovered85percentofthepopulationinthelargest182cities.[Note:MillicomIncorporatedwasformedtopursuecellulartelephoneopportunitiesinAmerica,andin1982,wasawardedbytheUSFederalCommunicationsCommissiononeofthreecellulardevelopmentlicenses.In1982,Millicomfounded,withRacalElectronicsPlc,ajointventurewhichevolvedintoVodafoneGroupPlc.MillicomInternationalCellularS.A.(“MIC”,“theGroup”)wasformedon14December1990whenIndustriförvaltningsABKinnevikofSwedenandMillicom,contributedtheirrespectiveinterestsininternationalcellularjointventurestoformtheGroup.In1993,MICenteredintodiscussionswithMillicom,regardingtheacquisitionofMillicom.MICofficiallybegantradingonNASDAQon31December1993.AsaconsequenceofthemergerMICacquiredallMillicom’sinterestinMICplusMACHandMillicom’sinterestin3C(UK),aUKbasedpaytelephoneoperation.TheremainingbusinessesofMillicom,includingitssuccessfulsatelliteTVoperations,thebroadbandlicenseforBritainandInnovaInc,acomputernetworkingcompany,werecontributedtoanewcompany,AmericanSatelliteNetworkInc.] ItsoperationsinAfricaareasfollows: In2005ZTEsignedatechnologyagreementwithPortugalTelecomwhichheightenedZTE'sprospectsinAfrica.TheR&DMemorandumofUnderstanding(MoU)involvesproductandservicedevelopment,andgivesbothcompaniesachancetoenternewmarkets.Italsoallowsforthetwofirmstojointlybidforcarrierprojects-PTholdsstakesinoperatorsinAngola,CapeVerde,Kenya,Morocco,andMozambique. In2005,ZTEalsosignedadealwithFranceTelecomtobecomeitsglobalsupplierofAsymmetricDigitalSubscriberLine(ADSL)equipment.FranceTelecomhas118,6millioncustomersworldwide.ItalsohasanagreementwithAlcateltointegrateitsCodeDivisionMultipleAccess(CDMA)radioaccessportfoliointoAlcatel’sCDMAendto-endsolutions.[Note:FranceTelecomhasafairlylargepresenceinthetelecommunicationsindustryinFrancophoneAfrica,withmajorityorcontrollinginterestsinSenegal(Sonatal),Mali(theSNOIkatel),Côted’Ivoire(Côted’IvoireTelecom)andMauritius(MauritiusTelecom).SpecificallyZTEwillplayakeyroleina100000-lineCDMAtelecomprojectinEgyptfortheCDMAupgradeslatedforCairoandtheNileDelta.] In2003,ZTE,joinedwitharegionaltelecomgroupinAfricaknownasComteltoinstallanewcommunicationsystemin20countriesonthecontinent.Approximately$240millionwillbespenttocompletetheprojecttoinstallAsynchronousTransferMode(ATM)technologyforAfrica'smajorfreetradebloc,theCommonMarketforEasternandSouthernAfrica(Comesa).ZTEwillimplementtheproject,installingthefibreopticcablesonexistingtelecompylonsorelectricitypowerlineslinkingtheComesaregion,whichextendsfromEgypttoSwaziland.TheChinesecompanywillbecomeamajorshareholderinComtelasithadcommittedasubstantialamountofmoneytowardsthe$240millionrequiredfortheproject. ComtelwasestablishedbyComesaasaninitiativetopromotetheestablishmentofaregionaltelecommunicationsnetworkintheregion.RegisteredinMauritiuson26May2000,ComtelissettosaveAfrica$120millioneachyear,theamountpaidtoWesterncountriesfortheuseoftheirtelecomcircuitsforcarryinginternationalcalls.ComtelwillalsointroduceadirecttelecomlinkbetweenComesamemberstatesandotherpartsoftheworld.Currently,manycallsfromAfricahavetopassthroughNewYorktogettoAsia.The20ComesamembersareZambia,Zimbabwe,Kenya,Malawi,Namibia,Seychelles,theDemocraticRepublicofCongo,Egypt,Mauritius,Angola,Ethiopia,Uganda,Sudan,Rwanda,Swaziland,Burundi,Eritrea,Djibouti,ComorosandMadagascar.China’sparticipationinthisprojectemphasizesthehighprioritybeingaffordedtoeconomicengagementwithAfricancountriesinthefieldoftelecommunications. Cumulatively,theICTsectorinAfricaattractedatotalofalmostUS$3billionofChineseinvestmentbetween2001and2007.China’sinvolvementintheICTsectorinAfricamainlytakestheformofequipmentsales.Insomecases,thisinvolvesnormalcommercialcontactsbetweenChinesemanufacturersandpublicandprivateoperatorsinAfrica.However,insomecases,itentailsinter-governmentalfinancingtiedtopurchasesofChineseequipmentbystateownedtelecomincumbents. WhileinternationalattentionhastendedtofocusonAfrica’snewprivateoperatorssuchasVodacom,MTNandCeltel,Chinesefirmsareemergingaskeyplayersinthesupplyoftechnologyandequipmentfornetworkstypicallytonationaltelecomincumbents.ByfarthelargestICTprojecthasbeeninEthiopia(US$1,5billion),whichinvolvedtheassociatedrolloutofmobilecoverageinruralareas. Thefour-yearproject,whichwasinitiallyagreeduponin2006,wastobeundertakenbyZTE,Huawei,andChineseInternationalTelecommunicationConstructionCorporation(CITCC).Itwasexpectedthatifcompleted,theprojectwillmorethandoublethecountry’sopticalfiberdeployment,morethantriplemobilenetworkexpansioncapacity,doubleruraltelecomcoverage,andquadruplethelengthofthefixedtelephonenetwork.In2007,ZTEcommencedconstructionofthefisttwophasesoftheproject.ThethreemostactiveChinesetelecomequipmentsupplyfirmswerestate-ownedZTECorp,privatelyheldHuawei,andthemixedprivate-public50-50French-ChinesejointventureAlcatelShanghaiBell.Inmostofthecasesrecordedbythedatabasethestate-ownedChinesebanksdirectlyprovidedthefundsfortheequipmenttothehostgovernment.Insomecases,ZTEwasabletofinanceitsdealsthroughstandinglineofcreditwithChinaEx-ImBankofUS$500million,issuedin2004.Similarly,HuaweiwasgrantedUS$600millionexportseller’screditfromChinaEx-Imbank,aswellasUS$10billionincreditfinancingfromtheChinaDevelopmentBank,bothin2004.Itisimportanttostressthattheselinesofcreditweregiventothecontractorfirmsfortheirworldwideoperations. AsalientexampleofChina’sICTprojectsistheNationalCommunicationBackboneInfrastructuralProjectinGhana,agreedtoinJuneof2006,wherebytheChinaEx-ImBankisfinancingUS$31millionofaUS$70millionprojectinitiatedbytheMinistryofCommunicationsthroughaconcessionalloan.Theprojectisaimedatrehabilitatingandexpandingfixedlinecommunicationstechnologyinthecountry. 9.4.ChineseTelecommunicationsCompaniesinAfrica HuaweiTechnologies HuaweiisthemainsuppliertotelecommunicationgiantsChinaTelecomandChinaUnicom,andoneoftheworld’sten-largestproducersoftelecomequipment.Itsmainproductsincludeswitchingsystems,intelligentnetworks,SynchronousDigitalHierarchy(SDH)transmissionnetworks,wireless,datacoms,broadbandintegratedservices(BISDN),powersupplies,andfreespaceopticalsystems.Companysourcesclaimthat“only”onepercentofsalesinvolvemilitarycustomers,althoughthislikelydeflatednumberstillrepresentsmorethanUS$30millionperyearinequipmentsalesandservice. Huawei'sproductsandsolutionsaredeployedinover100countriesandserve31oftheworld'stop50operators,aswellasoveronebillionusersworldwide.In2006,ithadannualrevenuesofUS$8,2billionandover44000employees.Overhalfitsrevenuescamefromoverseassales(US$4,8billion). Huaweiisoftendescribedas“aChinesefirmwithclosetiestoBeijing'smilitaryandahistoryofillicitexportsandindustrialespionage”,anallegationitvehementlyrejects. ZTEcommunications OriginatingfromtheNumber691electronicsfactoryundertheChinaAerospaceIndustryCorporation(CAIC),ZhongxingTelecom(ZTE)hasgrowntobecomeChina'slargestlistedtelecommunicationsequipmentmanufacturerandwirelesssolutionsprovider.ItlistssharesinHongKongandShenzhenandisChina'ssecond-biggesttelecomequipmentvendorafterHuaweiTechnologiesCo.Thecompanydevelopsandmanufacturestelecommunicationsequipmentforfixed,mobile,dataandopticalnetworks,intelligentnetworksandnextgenerationnetworksaswellasmobilephones.Thecompanyhasaggressivelyexpandedindevelopingmarketsbyexportingnetworkingproducts,establishingjointventuresandinvestinginlocalcommunicationoperations.ZTEChairmanLiTaifongpubliclyconfirmedinOctober2006thattheAfricanmarkethasbeentargetedbythecompanyasits“nextbusinesshub."ZTEhasestablishedthreeWiMAXR&DcentersinAmericaandChinasinceitsWiMAXoperationsbeganin2002.Withmorethan400R&DpersonneldedicatedtoWiMAXoperations,ZTEownsagrowingpatentportfoliointheWiMAXfield. AlcatelShanghaiBell(ASB) Alcatel-ShanghaiBell(ASB)isoneofthebiggesttelecommunicationsequipmentandsolutionsuppliersinAsia.ASBistheChineseflagshipcompanyofAlcatel-LucentinAsiaPacific.ItisthefirstforeigninvestedcompanylimitedbysharesinChina’stelecommunicationsindustry,withextensiveglobalresources.ASBbenefitsfromAlcatel-Lucent’scomprehensivenext-generation(NGN)portfolio.In2007ASBteamedupwithDatangMobile(whichinitiallydevelopedTD-SCDMAnetworksolutions)toprovideTD-SCDMAtoChineseserviceprovider,ChinaMobile.DatangandASBdeployedTD-SCDMAforChinaMobileinShanghaiandinthesoutherncityofGuangzhou.ASBprovidedtheNodeBequipmenttobeusedinthenetwork. ChinaMobile ChinaMobileLimited,China’slargesttelecomscompany,waslistedontheNewYorkandHongKongStockExchangesin1997.AstheleadingmobileservicesproviderinChina,thegroupboaststheworld'slargestunified,contiguousall-digitalmobilenetworkandtheworld'slargestmobilesubscriberbase.In2006,theCompanywasonceagainselectedasoneofthe"FTGlobal500"byFinancialTimes,andinthe"TheWorld's2000BiggestPublicCompanies"byForbesMagazine.InApril2007ChinaMobileindicatedthatitplannedtobuycompaniesinAfricaandSoutheastAsiaasgrowthacceleratesinthoseregions.However,itdeniedreportsthatitwasplanningtobuyastakeinSouthAfricanbasedmobileplayer,MTNCorp.However,sourcesconfirmthatforaperiod,MTNwasthetargetofsomesortofChineseacquisitionattempt.[Seebelow] 9.5.SomeCountryCaseStudies Algeria AlgeriaisoneofChina’skeystrategicalliesinAfrica.Thetwomainreasonsforthishavetodowithoilandthewaronterrorism. Ontheenergyfront,AlgeriawasthefirstAfricancountryvisitedbyChinesePresidentHuJintiaoduringhisfirsteveroverseastripafterbecomingpresidentin2003.HetoucheddowninAlgiersinearlyFebruary2004andsignedseveralagreementsrelatedtotheenergyandtelecommunicationssectorswithinthebroadframeworkofanewstrategiccooperationagreement. However,ChinawasalreadyactiveinAlgeria’stelecomsindustrypriortoHuJintao’s.visit.HuaweiwasestablishedinAlgeriain1999andtodayhasaccesstoover80percentofalltheoperatorsandprivatenetworkmarketsinAlgeria.ThecompanyisthebiggestCDMAwirelesslocalloop(WLL)systemandterminalproviderinAlgeria,andprovidedAlgeriaTelecomwithawiredandwirelessintegratedCDMAWLLnetworksolution,whichadoptsanintegratedswitchcentre(C&C08)thatcanmergewithAlgeriaTelecom'sexistingPSTN.Inaddition,thenetworkcanconnectwithHonet,fixedtelephoneline,ADSLandothervendor'sCDMAWLLequipment,makingitextremelyflexibleandrequiringlessstart-upcoststoconstructtheAlgerianaccessnetworkwhichcovers7provincesthrough113000lines. InApril2003HuaweiwastaskedwithexpandingAlgeria'sGSMnetworkin14regions. In2005,HuaweiwonthebidofthepurchaseditemsforthenextgenerationbackbonetransmissionnetworkequipmentfromAlgeriaTelecom.Thisproject’sbackbonetransmissionnetworkwillcoverallterritorieswithinAlgeria,whichrequiresthenetworkandequipmenttobeabletoprovideabundantdataservicecharacteristics,intelligentcharacteristics,andhighreliabilityofnextgenerationnetworkorientedapplications.HuaweiwontheprojectthankstoitscustomizedASON-basedOptiXOSNsystem. InMarch2007HuaweiwasselectedbytheAlgerianfederalrailway-SociétéNationaledesTransportsFerroviaires(SNTF)toprovideaGSM-Rcommunicationsolutionforthe220kilometer-longTabia-Mecheriarailwayline,animportantpassengertransportrouteinAlgeria.IntermsofthecontractHuaweiwillprovideGSM-RnetworkdesignandengineeringservicestoSNTF,withALSTOMsupplyingtherailwaysignallingsystem.Whencompleted,theTabia-MecherialinewillbeAlgeria'sfirstmodernrailwayequippedwithworld-classGSM-Rtechnologies. InMay2007HuaweiofficiallylaunchedtheCDMA20001xEV-DOnetworkinAlgiers,thecapitalofAlgeria.WithHuawei'sLiteFMEsolution,AlgeriaTelecom'sPSTN,CDMAWLLnetworkandADSLnetworkcanbeconverged,includingCRBT(ColourRingBacktone),EV-DOdataservice,pre-paidportalforEV-DOservice,videophoneinfixednetworkandIntegratedCentrex,whichisaPBX-likeserviceforenterpriseusers.[Note:Earlierin2007AlgeriaTelecomlaunchedthreenewservices,'ADSLAssilaPackPro3000','ADSLAssilaPackPro4000'and'ADSLAssilaPackPro8000'foritsbusinesscustomerswithspeedsupto8Mbps.]Otherdevelopmentsinclude: ThedonationbythecompanyoftelecomequipmentincludingGSM,CDMA,switchingandaccessproductsworthUS$30million Theestablishmentofatrainingcentretowardstheendof2006. TheopeningofanewregionalofficefornorthwestAfricainAlgiersinSeptember2007. WorkcurrentlytakingplaceonthetrialprojectofEV-DORev.A,whichcanreducethecustomers'OPEX,CAPEXanduserchurnwhileincreasingservicerevenue. ZTEIn2003,ZTEsecuredacontracttobuildAfrica´slargestCDMAWLLinAlgeria,afterpresentingabidforamobilenetworkthatwas18to21percentlessexpensivethancomparativebidsmadebyUScompanies.ThefinalcontractwasworthUS$32million,forafirstphaseofinstallation,withseveralspin-offs.Priceswerekeptlowbythecompany,duetoaSinosuresupportedIndustrialandCommercialBankofChina(ICBC)“softloan”–aclassicexampleofstatesubsidizedChinesedeals.ThisdealincludedtheconstructionbyZTEoftwoCDMAWLLnetworks,whichcover43provincesinalleightdistrictsofAlgeria. InOctober2004ZTEannouncedthatitwastoopenamanufacturingfacilityinthecountry(forwirelessfixedterminalsandotherequipment)incooperationwithlocalcompanyINATEL. By2005,thecompanyhadprovidedanationalCDMAnetworkcovering95percentofthecountry(includingthethreeprovincesofTiziOuzou,BouiraandBejaiainnorthernAlgeria).ThenewnetworkinvolvesaMobileSwitchingSystem(MSS),BaseStationSystem(BSS),PacketDataServingNode(PDSN),OperationandMaintenanceCenter(OMC),arepaircentre,atrainingcentreandasoftwaresupportcentre. In2006ZTEwasawardedacontracttosupplyopticalnetworkequipmenttoATMMobilis,thelargestmobileoperatorinAlgeriawith1,2millionsubscribersatthetime.Underthecontract,ZTEistoprovideitsopticalproductsincludingtransmissionequipment,powersupply,opticalnetworkmanagementsoftwareandSDH/PDHanalyzers. Egypt Withapopulationofover60million,EgyptisthethirdlargestmobilemarketinAfricaafterSouthAfricaandMorocco.TheEgyptianmobilemarketisdominatedbytwoprivateoperators,MobiNilandVodafoneEgypt.MobiNilandVodafonewereforyearstheonlyprovidersformobiletelecommunicationsbeforetheEmirates-basedEtisalatwaschosenasthethirdproviderofferingthirdgeneration(3G)servicesin2006. In2002theMinistryofCommunicationsandInformationTechnologyofEgyptandtheMinistryofInformationIndustry(MII)ofChinasignedamemorandumofunderstandingaimingatthedevelopmentoftheICTindustryinbothcountries. Huawei HuaweienteredEgyptin2000anditsMiddleEastandNorthAfricanoperationsareheadquarteredinEgypt.Huaweialsohasatrainingcentreinthecountry.TelecomEgyptusedHuawei'sTELLINsolutiontobuildaFixed-lineIntelligentNetwork(FIN)thatcoversthewholecountry.HuaweienabledTelecomEgypttoprovideCDMAWLLservicestobothfixedandmobilesubscribers,includingvoiceanddataservices,withanetworkcapacityof100000.Inaddition,TelecomEgyptbuiltaMSAN(MultiServiceAccessNetwork)nationwidecomprising500000lineswhichmadeuseofHuawei'sHonetaccessnetworksolution.TelecomEgyptalsodeployedHuawei'sOptiX10GequipmenttobuildthecoreCairoMetropolitannetwork,whichhasmorethan50nodes.In2006TelecomEgyptandHuaweisignedanagreementtomanufactureCDMAwirelesslocalloopterminals. HuaweiusedRayaNS(RNS)toundertaketheturn-keyinstallationofHuaweiCDMA2000WLLswitchesandbasestationsinUpperEgyptandSuezCanalregionstoexpandTelecomEgypttelephonyservicestoremoteareas. Egypt’sINHardwareInstallationNetworksuppliedbyHuaweiTechnologiescovering8sites:Roda,Abbassia,Alexandria,Suez,Tanta,Mansura,SohagandMenia,werealsoimplementedbyRNS.RNSfurthercompletedtheinstallationof4fibreopticsringscovering17sitesalongwithitsnetworkmanagementsystem.RNSwasawardedtheinstallationbyHuaweiwhichreceivedthecontracttoperformthefirsttrialfor10Gand155/622Mfiberopticstransmissionequipment. In2005theEgyptianCompanyforMobileServices(Mobinil),Egypt'sleadingmobileserviceoperatorandHuaweistartedtoworkonSoftswitchtrialsinEgyptandfinishedthefirstcallonthistrialmobilenetworkduringthisperiod.MobinilsignedacommercialcontractwithHuaweiin2006toexpandthenetworkcapacityto5millionprospectivecustomers.[Note:MobinilwhichwasthefirstequipmentsuppliertointroduceSoftswitchtechnologyinto2G/3Gmobilecorenetworkcommercialconstruction,selectedHuaweifortheprovisionofitscorenetwork.Mobinil’sshareholdersareOrangeandOrascomTelecomHolding.] In2006,TelecomEgyptselectedHuaweitoprovideDenseWavelengthDivisionMultiplexing(DWDM)technology.Thistechnologyenablesmultiplevideo,audio,anddatachannelstobetransmittedoveronefibreandincreasestheefficiencyandbandwidthofnetworksbysupportingdifferentformats.ThethreeyearcontractwillincreasethecapacityofTelecomEgypt’sCaironetworkandreduceoperatingcostswhileincreasingqualityofservice. AccordingtoDawlatElBadawi,theplanningvicechairmanofTelecomEgypt: Emergingdemandforadvanced,higher-qualitycommunicationsposesaparadigmshiftingchallengetotelephoneoperators.Originallydesignedtocarrycircuitswitchedvoicetraffic,existingnetworksnowneedtocarryheavydataloads,deliverstreamingvideo,andprovideInternetaccesstoarapidlygrowinguserbase.Thedecisiontoevolveournetworkissignificantandistheresultofin-depthresearchandanalysis.HuaweioffersindustryleadingtransmissionnetworkarchitecturewithitsDWDMtechnologyandenableustogiveourcustomersaccesstonew,advancedserviceswhileenhancingthesecurityandqualityofexistingservices. TheHuaweiDWDMequipmenthasbeenappliedtoover250nationalandinter-citytransmissionnetworks.IntheMiddleEast,HuaweiDWDMTechnologieshavebeenwidelyadoptedinmanycountriesliketheUAE,SaudiArabiaOman,Tunisia,Algeria,andMorocco. In2005,HuaweiTechnologiesinauguratedaregionaltechnicalassistancecentreandatrainingcentreinCairo,aimedateducatingpartners,customersandsub-contractorsofthecompany’sextensiveportfoliooftelecomsequipment.Thetrainingfacilitycoversanareaof300squaremetresandcomprise13classroomsandlabs,withacapacityof150traineesatanygiventime.Onitsopening,atotalof58trainingprogrammeswereavailable. Atthetime,TianFeng,vicepresidentofHuaweiTechnologiesboastedthat“ourentryintoEgyptfouryearsagoandourknowledgeandexperienceisequaltothebestintheworld”andaddedthat“thestrategiclocationofEgyptisimportanttous”.ThetotalsizeoftheinvestmentinthetwocentresamountstoUS$20million. ZTE On6May2004,ZTEandHuaweiwonacontracttolaunchamobilephonenetworkusingCDMAtechnologyinEgyptafterfightingofffiercecompetitionfromotherglobalgiants.Thecontract,signedbetweenthetwoChinesecompaniesandtheEgyptianCommunicationsCompany(ECC),aimedtolaunchtheCDMAmobilephonenetworktoserveupto100000usersatacostofmorethanUS$20million. TheECCpickedthetwoChinesefirmsafterinvitinganinternationaltenderthatattractedsevenglobaltelecommunicationcompanies.AccordingtoECC’sChairmanOkailBashir,theselectionwasnotbasedonlowpricesonly,thoughpricesareoneoftheimportantcriteria,buttechnicalefficiencywhichwastheessentialelement. Thefirstphaseoftheprojectentailed48000linesintheDeltaand52000linesinCairo’s16suburbs.PhaseIIincludestheestablishmentofan800Mcorenetworkalongwithanaccessnetworkandfixedwirelessterminals.In2005ZTEsignedafurthercontracttoexpandtheCDMAWLLnetworkto100CDMAWLL. Angola AngolahasbecomeoneofChina’smostimportanttelecomsmarketinrecentyears.ThelargestplayerinthecountryisZTE. In2005ZTEdeployeditsfirsteverAfricacommercialWiMAXnetworkinAngolafollowinganagreementofUS$69millionsignedwithMundostartel(MST),Angola'ssecondlargestfixed-lineoperator.ZTEprovidedMundostartelwiththeequipmenttobuildanationwideWiMAXnetwork.Thenetworkcoversthreecities(Luanda,BenguelaandLobito)andprovidesbroadbandandVoIPservicesformorethansixmillionpeople.Itwilleventuallybedeployedin8provinces.ItwasalsothefirsttimethatZTEinstalledanNGNbasedonanIPplatformwithCDMA20001xandEV-DOtechnology. Underthetermsoftheagreement,ZTEsuppliedMSTwithitsend-to-endWiMAXsolutionincludingbasestationsandCPEs(CustomerPremisesEquipment)whichofferscalabilitytoan802.16e(mobileWiMAX)network,roamingsupportarchitectureandproductserialisation. ZTEsaidthenetworkwouldprovideNGNtechnology,whichallowsanalogservicesliketraditionalfixed-linevoicecallstobecarriedonthesamenetworkasdigitalsignalssuchasmobiletelecomtraffic.ItwouldbeamongthefirstofitskindinAfrica. [Note:MundoStartelhasthelicensetorolloutfixed-linetelecommunicationsnetworkinAngolaandintendstoincreaseitsmarketshareupto40percentby2010.TelecomNamibiaowns44percentofMSTandcontributedUS4,2millionoftheoriginalUS$9,7millioninequitycostingofthewirelessnetwork.] InNovember2006,Angola’sPrimeMinisterPeidoNandóvisitedtheShenzhenZTEHQwherehewaspresentedwiththefirm’snewgenerationproposalsforAngola.ZTEhas100peopleworkingfulltimeinAngolaandisnoweyeingtheSaoTomesemarket.WithprojectsinAngolacurrentlyworthUS$400millionZTEhasbeenworkingonaNGNaccessnetwork,IntelligentOpticalTerminal(IOT)andGSM/CDMAnetworks,withAngolaTelecom(thelargesttelecommunicationscompanyinthecountry)andMSTelemasitslocalpartners.IthasalsobeenworkingonaclassifiedsecuretelecomsnetworkforAngola’sArmedForces(FAA),valuedataroundUS$80million,becausethemilitary’stopbrassaredissatisfiedwiththestateofsecurecommunicationconnectionstocommandcenters. AlcatelShanghaiBell(ASB) In2002AlcatelShanghaiBell(ASB)andAngolanTelecomsignedaUS$60millioncontracttoexpandandoptimizethetelecommunicationnetworkinsouthandeastAngola(Namibe,Huile,CuneneandLundaNorte).Thedealcovereddesign,project,productsandequipmentsolutions. ShanghaiBellprovidedAlcatelS12switchingequipment,Litespanintegratedaccessequipment,SDH622MandSDH155Mopticaltransmissionequipmentandopticalandelectriccable.Itwasalsocommissionedtosetupasatelliteearthstationandreconstruct4satelliteearthstationsandalltheexteriorlinesforAngolanTelecom.[Note:Theconstructionandinstallationstartedin2005.JapanTelecommunicationsEngineeringandConsultingService(JTEC)managedandsupervisedtheinstallation.] ChinaInternationalTelecommunicationConstructionCorporation(CITCC) In2005CITCCcompletedfourphaseprojectsfortheimprovementofAngolaTelecom’stelephonenetworkinLuanda.CITCCalsobuilt42kmofnewtelecomducts,laid366kmoftelephonecables,andsuppliedtelephonelinesfor200000people. Huawei Huaweiispresentin6Angolanprovinces,whereithasinvestedUS$7milliontobuildatrainingcentreoftelecommunicationstechnologiesandupgradetheITEL(SchoolofTelecommunicationsTechnologies)attheUniversityofTelecommunications.TheuniversityiscurrentlyunderconstructioninLuanda. HuaweihasalsointroducedNGN,accessnetwork,intelligentopticaltransmission,GSM,CDMAanddatacomproductstoAngola. IthassignedcooperationframeworkagreementswithAngolaTelecomandMSTelcom. SouthAfrica AnothercriticalareaforChinesetelecomdevelopmentinAfrica,SouthAfricaservesasthehead-quartersandlogisticscentreforbothZTEandHuaweionthecontinent.TheHuaweiSub-SaharancommandcentreinJohannesburgisparticularlyimpressive,locatedonthe1stfloor,Building28,TheWoodlands,WoodmeadinJohannesburg.HuaweialsohasaTechnicalTrainingCentreinSouthAfrica,co-mannedbyTelkom. ChinesefirmsarebusyintryingtobringinSouthAfricantechnologytoBeijingandShanghai,andtoestablishjointventureswithbigoperatorslikeMTN,inthirdcountrieswheretheyhavelowerprospectsofcompeting. Huawei HuaweifirstenteredtheSouthAfricanmarketin1998inPretoria,andrelocatedtoJohannesburgin1999.AtraininginitiativewiththeUniversityofCapeTown(UCT)iscurrentlyunderway,anditwillseektosupplybasicandadvancedproducttrainingtotelecomsengineers.HuaweihassuppliedtheuniversitywiththenecessaryequipmentneededtooperateafullyfunctionalHuaweitrainingfacility. HuaweiisTelkom'sonlystrategicpartnerforits21CNintegratedaccessnetwork,providinganaccessplatformintegratingvoice,IPandvideo.Furthermore,HuaweiprovidesVodacomwithadvanced3GterminalsandCellCwithhigh-endIPnetworksandvalueaddedservices.HuaweialsobecameastrategicglobalpartnerofMTNin2005,havingsigneda3-yearframeworkagreementworthUS$600million,featuringcommunicationsequipmentprovisionandservice.HuaweiisalsolistedasthefirstpartnertobechosenbythefixednetworkoperatorSNO.TheGovernmentoftheNorthwestProvincehasalsopurchasedandimplementedanIPWANfromHuawei. Huaweihasfocusedmuchattentionontrainingprogrammes.Forexample,thecompanycooperatedwithTelkomtosupportSouthAfrica's"TalentPlan"byfundingZululandUniversity,andprovidingpostgraduatestudentswitheducationfundsandresearchsubjects. HuaweihasalsosetupanIPnetworktrainingandcertificationcentreinUCTtoprovidefreeIPengineering,technicaltrainingandcertificationforSouthAfricaandsurroundingcountries.Overthepastyear,thecentrehasprovidedsuccessfultrainingandcertificationformorethan100people. Furthermore,on6August2008anothertrainingcentrewasopenedinSouthAfricalocatedinWoodmead.ThisfacilitybroughtthenumberofHuaweitrainingcentresinAfricatofive,withtheotherfacilitieslocatedinNigeria,Kenya,EgyptandTunisia.Attheendof2007,over4000Africanshadgraduatedfromthesecentres. ZTE ZTEenteredthemarketthroughVodafoneGroupplc,thena50percentshare-holderinSouthAfrica'sVodacominMay2007.Vodafoneunveiledultra-cheapcell-phones,aimedatbolsteringitspositioninemergingmarketsandatofferinganalternativetoNokiaandMotorola'scheapesthandsets.Thesecond-generation,or2G,phones,calledtheVodafone125andtheVodafone225,arethefruitofVodafone'srecentpartnershipwithZTE.[Note:VodafoneisalsoworkingwithHuaweion3GhandsetsandwithSagem,thephone-manufacturingunitofFrance'sSafran,onanultra-cheapGSMhandset.] ChinaEyeingMtn? Foraperiodin2007/early2008,rumourspersistedthatChinaTelecom,thecountry'slargestfixed-linetelecommunicationsoperatorbyusers,wasplanningtobuyastakeinSouthAfricanmobileoperatorMTNGroup.AccordingtoEuropeansources,theChinesetakeoverofMTNhadlongbeenplanned.Firstitwasthoughtthatanumbrellagroupofenterprisesshoulddoitattheendof2005.ThentheplanwasforChinaMobiletomakeabidwithheavyChinaEximbankfinancialsupport. 9.6.RecentDevelopments September2008:ZTECorporationannouncesaUS$70millioncontracttoexpandthecountry’stelecomsnetwork.China’sHuaweiTechnologieshaswonaUS$20millioncontracttobuildafibreopticnetworkinTripoli.Libyaisplanninganation-wideInternetandmobilephoneservice.Chinesecompaniesareexpectedtobeattheforefrontofthesedevelopments. October2008:ItwasreportedfromNigeriathatplansareafoottousetheinfrastructureofNIGCOMSATforcommercialtelecommunications,whichwillberunbythegovernmentandZTE,withtheintentionofrollingoutlinesacrossthecountrywiththenameofNIGCOMSATandcompetingwiththeprivatetelecommunicationsoperators(PTOs),aswellasGSMoperators.NIGCOMSATissaidtobebuildingatelecommunicationsnetworkthatwouldprovidevoiceanddataserviceswithahostofothervalue-addedservices.[Note:NIGCOMSATwaslaunchedintospaceinChinaonMay17,2007andwasconceivedtotakecareoftheintegratedcommunicationinfrastructureofNigeria’ssecurityagencies,includingtheStateSecurityService(SSS),NigeriaIntelligenceAgency(NIA),aswellastheOfficeoftheNationalSecurityAdviser(NSA) November2008:China’sZTECorporationwonacontracttobuilda2,5GHzmobileWiMAXcommercialnetworkinMauritania.Intermsoftheagreement,ZTEwillprovideacorenetwork,equipment,wirelessaccessunitsandcommunicationsterminals. 目次 1.Introduction 2.AfricaintheContextofChina'sResourceAcquisitionRequrements 3.TheOriginsofChina'sNewAfricaPolicy 4.TheRoleofFOCAC 5.China'sNewResourceAcquistionBusinessModel 6.TheRoleofChineseInstitutionsintheAcquisitionofBusinessIntelligence 7.China'sEnergyFootprintinAfrica 8.China'sMiningFootprintinAfrica 9.China'sTelecommunicationsFootprintinAfrica 10.China'sInfrastructureFootprintinAfrica 11.TheRoleofChina'sFinancialInstitutions 12.ImplicationsforJapaneseInvestors AnnexureI:TheFocacFucStructure AppendixII:TheForumonChina-AfricaCooperation AnnexureIII:MinistryofCommerce AnnexureIV:ProfileChenYuanandChiJanxin