TROPICAL GEOGRAPHY ›› 2017, Vol. 37 ›› Issue (2): 246-257.doi: 10.13284/j.cnki.rddl.002935

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Construction and Development of the Zambia-China Economic and Trade Cooperation Zone

MENG Guangwen,SUI Nana,WANG Xue   

  1. (a.College of Urban and Environmental Sciences,b.College of History and Culture,c.Institute of Free Economic Zones, Tianjin Normal University,Tianjin 300387,China)
  • Online:2017-03-05 Published:2017-03-05

Abstract: Since the 1980s, China has begun its direct investment in Africa. Economic and trade cooperation has been strengthened under the joint efforts of both sides. China has established six economic and trade cooperation zones in Africa according to the successful experiences of Chinese special economic zones, and the establishment and operation of these economic and trade cooperation zones are in line with the interests of both sides and have a huge potential for development. Up till now, research by experts in China and abroad has mainly focused on the establishment background, development process and status, influencing factors, and measures and suggestions for sustainable development of China-Africa economic and trade cooperation zones without in-depth investigation of a single economic and trade cooperation zone. Therefore, using Zambia-China Economic and Cooperation Zone in southern Africa as an example, the present paper analyzes the advantages of and challenges faced by the cooperation zone based on its establishment background and development process. One advantage is a mature political and economic environment in Zambia. Zambia has a mature national system and maintains friendly relations with many countries. Its GDP has achieved continuous positive growth for years now, and its macro-economy is stable. Another advantage is reflected in the protection and incentive policies made by the two governments: the Chinese government set up an economic and trade cooperation zone development fund and provides policy support for investment and financing; Zambia provides work permit and tax incentives. In addition, Zambia has a large market radiation circle; it is not only a founding member of the World Trade Organization, but also a member of the East African Common Market and the Southern African Development Community. Last but not least, the cooperation zone provides a full range of "one-stop" services for enterprises, and Zambia’s mature management experience has provided favorable conditions for the development of the cooperative zone. However, the cooperation zone is also facing some difficulties and challenges in its development process. The infrastructure outside the zone lags behind, especially transportation and power, which has become a bottleneck restricting the development of the cooperative zone; Zambia’s presidential election in every 5 years easily leads to legal and policy changes; the initial big investment but low profitability leads to financial shortage; additionally, Zambia’s prominent disease problems are questioned by the Western countries. According to the existing problems in the cooperation zone, the present paper discusses the experience and implications of its construction. The cooperation zone should rely on the Chinese government to set up a SME Development Fund and help Chinese financial institutions to set up branches in Africa to provide financing consulting, financial management and other aspects of services timely for enterprises; enterprises should play their roles in investment, focus on creating a complete industrial chain, make job-division and collaboration, reduce production costs and achieve economies of scale and agglomeration effect, and enhance cooperation competitiveness and ability to resist risks; enterprises should strictly abide by local laws and regulations, respect local culture and customs, and pay attention to the protection of local ecological environment; enterprises should focus on local people's livelihood, share achievements with local people, and actively fulfill their social responsibilities so as to obtain long-term sustainable development; last, exchanges between China and Africa should be strengthened and negative public opinion should be dealt with.

Key words: free economic zone, foreign economic and trade cooperation zone, Zambia-China economic and trade cooperation zone, China’s foreign investment, the Belt and Road Initiative