China strengthens food ties with Angola, sealing second deal in last week

China’s Sinohydro Group is investing more than $100 million in Angola to develop new sources of grain and food imports, the second agricultural deal the two countries have struck this week, Bloomberg reported.

Angola granted Sinohydro a 25-year, interest-free concession to develop 30,000 hectares of land in six eastern provinces in an agreement signed Thursday in the capital, Luanda.

Four days ago, a unit of Chinese state-owned conglomerate Citic Ltd. announced plans to invest $250 million to develop large-scale soybean and corn farms in Angola.

The project will involve building logistics infrastructure and agricultural support facilities, according to the managing director of the company, which has been operating in Angola for more than two decades. Sinohydro will also build a seed research and testing center to improve productivity and attract more Chinese agribusinesses to Angola.

“Angola has a large territory but lacks basic infrastructure,” a company representative noted on the sidelines of the signing. “Now is a good time to invest – the environment here is better than in many African countries.”

The investment supports the Angolan government’s initiative to revive large-scale agriculture and reduce the country’s dependence on food imports. About 60% of the concession’s output will be exported to China, mainly soybeans, while the rest will be reserved for domestic consumption.

Angola hopes to sign additional deals with Chinese companies as interest in the sector grows. “We have already received several offers, and I am sure that we will conclude more deals with Chinese companies,” the country’s prime minister noted. He hopes that the project will attract additional Chinese investment as the company prepares the land and infrastructure to support future agribusiness projects.

Tags: China, Angola