The China-African Development Fund (CADFund) as a sovereign wealth fund for Africa’s development
CCS Policy Briefings are drawn from the published reports and other material produced by the Centre. They aim to highlight specific recommendations and outcomes from the larger reports and present them in a concise, easily consumable format.
The original publication is available at http://www.sun.ac.za/ccs
The China-Africa Development Fund (CADFund) forms part of the Chinese government’s practical implementation, for some of its plans and objectives, for the African continent. CADFund was established as part of the eight measures announced by then Chinese President Hu Jintao, at the 2006 Forum on ChinaAfrica Cooperation (FOCAC). While operating according to market principles, the Fund is an economic and diplomatic tool of the Chinese government to encourage Chinese enterprises’ investments in African countries. Chinese investments might boost African economies; yet, there is no automaticity in developmental effects. CADFund’s operations as a sovereign wealth fund can be compared to other such funds in the African context. This policy brief elaborates on the setting and policy of CADFund, specifically in comparison to Norfund, Norway’s sovereign wealth fund for investments in developing countries, which also has a development vocation. The policy brief concludes with recommendations for change.