VZCZCXRO0887
RR RUEHMA RUEHPA
DE RUEHNM #0452/01 1201333
ZNR UUUUU ZZH
R 291333Z APR 08
FM AMEMBASSY NIAMEY
TO RUEHC/SECSTATE WASHDC 4271
INFO RUEHZK/ECOWAS COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 0184

UNCLAS SECTION 01 OF 02 NIAMEY 000452 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PREL ECPS EMIN EPET EAID EFIN MARR SENV TRGY
NG 
SUBJECT: CHINA'S ENGAGEMENT IN NIGER 
 
REF: A. SECSTATE 41697 
     ¶B. 07 NIAMEY 1359 
     ¶C. 08 NIAMEY 278 
     ¶D. 06 NIAMEY 866 
 
¶1. (SBU) Summary. On April 14, the Chinese Ambassador to 
Niger gave an interview to the Nigerien weekly newspaper "La 
Griffe" (The Claw). In the article he summarized China's aid 
projects in Niger. He stated that Chinese aid to Niger was 
given "without selfishness and without conditions."  The 
Chinese Ambassador was not entirely forthcoming, however, 
because in the article he failed to discuss the mineral 
concessions and other business contracts that have been 
awarded to Chinese companies in recent years - except to deny 
rumors of a link between the two. End summary. 
 
¶2. (U) The most talked about Chinese development project in 
Niger is the construction of a second bridge spanning the 
Niger River in Niamey.  The first bridge, known as the 
Kennedy Bridge, was built in 1969.  To date, it is the only 
bridge over the Niger River in the country.  The bridge is 
congested and dangerous, and a second bridge is greatly 
needed.  The cornerstone of the bridge was placed with great 
fanfare on November 5, 2007 (Ref B).  There has been no 
additional work on the bridge since that time. 
 
¶3. (U) The Chinese have sponsored, or are in the process of 
sponsoring, other highly visible construction projects: a 
water treatment plant, a sports stadium, a housing complex, a 
center to combat malaria, a commercial center, and two rural 
schools.  One symbol of China's increasing presence in Niger 
is the construction of the new PRC Embassy.  In addition to 
these projects, China has increased the number of Nigerien 
products which can be exported to China duty free, sent 30 
physicians to provide health sevices in local hospitals, 
given medicine, farm equipment, hospital equipment, and 
office equipment to various entities, and has forgiven 
approximately $12 million in debt (Ref B). 
 
¶4. (U) China's presence in Niger is not confined to aid. 
Chinese national companies operate in many of Niger's 
important economic areas: uranium, oil, telecommunications, 
and textiles. 
 
¶5. (U) URANIUM: In November 2007, the GON and the government 
of China created a mining company known as SOMINA. 
Thirty-three percent of the company is owned by the GON, 5 
percent is owned by a private Nigerien citizen, and 62 
percent is owned by the Chinese Nuclear International Uranium 
Corporation (CNIUC) in partnership with the Chinese 
investment company Zxjoy Technology and Trade.  On April 8, a 
wholly-owned subsidiary of CNIUC, SinoUranium, along with the 
Chinese Hydraulic and Hydroelectric Construction Group 
Corporation (Sinohydro Corp), signed a deal with the GON to 
establish a mining operation at the Azelik mining site near 
the town of Arlit.  The mine will operate under the auspices 
of SOMINA.  When the mine becomes operational in 2011, it is 
expected to produce 700 tons of uranium per year.  According 
to the GON Director of Mines, China will receive 62 percent 
of the uranium produced at the mine.  The GON and the private 
Nigerien citizen will have the option to sell their 
respective 33 and 5 percent of the uranium to China or to 
third parties on the open market. 
 
¶6. (SBU) OIL: In March 2008, the Chinese National Petroleum 
Corporation (CNPC) was awarded one-third of an oil 
exploration and production permit for an area known as the 
Agadem Block.  Previously held by a joint ExxonMobil-Petronas 
venture, the Agadem block is known to contain at least 320 
million barrels and may, in fact, contain much more (Ref C). 
The award of the Agadem block partially to the CNPC has not 
been announced officially.  China is apparently unhappy 
sharing the permit, and the Ministry of Mines and Energy is 
reportedly having difficulty negotiating an agreement between 
China and the other two partners.  It has been rumored that 
construction on the second bridge over the Niger River will 
not move forward until China is satisfied with its level of 
participation in the Agadem Block. 
 
¶7. (U) TELECOMMUNICATIONS: Two Chinese firms are intricately 
involved in Niger's telecommunications industry.  In 2001, 
the Nigerien state-owned telephone company SONITEL was 
privatized and purchased by Chinese and Libyan interests. 
China's stake in SONITEL is held through its state-owned 
telecommunications company ZTE.  Additionally, the 
privately-held Chinese telecommunications giant Huawei 
Technologies is responsible for the creation and maintenance 
of the GON's intranet service. 
 
¶8. (U) TEXTILES: In 1997, the GON privatized its textile 
 
NIAMEY 00000452  002 OF 002 
 
 
production company, ENITEX, which was bought by Shanghai 
WorldBest Hometex, a subsidiary of the Chinese state-owned 
company China WorldBest Group (CWBG).  ENITEX controls 80 
percent of Niger's domestic textile market.  In 2007, ENITEX 
shut down all of its milling and weaving operations, 
effectively wiping out commercial textile production in 
Niger. ENITEX retained only its printing and dying 
operations, which rely solely on imported fabric from China. 
In 2006, the Chinese Ambassador reported that ENITEX's owners 
were interested in eventually phasing out the company 
entirely (Ref D). When China took control of ENITEX it 
employed over 700 people.  Today it employs 190. 
 
9.(U) Comment. There is a good reason why the Chinese 
Ambassador prefered to highlight China's aid programs rather 
than its business dealings in Niger: China's commercial 
transactions are perceived locally as not benefiting Nigerien 
citizens.  First, Chinese construction projects in Niger are 
completed with mostly Chinese labor.  Second, Chinese control 
of various entities has not been shown to greatly improve 
services or add jobs to the economy.  For example, in 2006 
the GON threatened to revoke ZTE's telecommunications license 
because it failed to make promised upgrades. Although some 
improvements have been made since then, the changes have not 
occurred fast enough and ZTE's contract is currently being 
reviewed by the National Assembly. Third, despite what the 
Chinese Ambassador said, many people in Niger believe that 
Chinese aid is contingent upon the rewarding of lucrative 
government contracts to state-owned Chinese entities. End 
Comment. 
 
¶10. (U) Embassy Niamey maintains good relations with the PRC 
Embassy in Niamey.  Currently, post is not cooperating with 
the GOC on any specific projects, but interactions at local 
meetings are relaxed and cordial. 
ALLEN