VZCZCXRO8786
PP RUEHMA RUEHPA
DE RUEHAR #0614/01 1291646
ZNR UUUUU ZZH
P 081646Z MAY 08
FM AMEMBASSY ACCRA
TO RUEHC/SECSTATE WASHDC PRIORITY 6490
INFO RUEHZK/ECOWAS COLLECTIVE
RHMFISS/CDR USAFRICOM STUTTGART GE

UNCLAS SECTION 01 OF 02 ACCRA 000614 
 
SIPDIS 
 
SENSITIVE 
 
E.O. 12958:  N/A 
TAGS: PGOV EAGR ECPS EFIN MARR PREL SENV TRGY GH
SUBJECT: China's Engagement in Ghana 
 
REF: (A) STATE 41697, (B) ACCRA 561 
 
¶1. (SBU) SUMMARY: While China's close ties to Ghana date to the 
establishment of diplomatic relations in 1960, economic and 
commercial ties are growing, with China focused on a series of 
high-profile infrastructure projects.  The Chinese have shown little 
interest, however, in coordinating with other major development 
partners and are notably absent from regular sector coordination 
meetings.  As requested reftel, following is a summary of Chinese 
engagement in Ghana, including areas for potential cooperation 
between the U.S. and Chinese Missions. END SUMMARY. 
 
China's Commercial and Economic Interests in Ghana 
--------------------------------------------- ----- 
 
¶2. (U) China has focused its efforts in Ghana in the commercial and 
economic areas, but has also provided support to Ghana's 
participation in various African peacekeeping missions, including a 
grant to purchase vehicles, the sale of several Chinese fighter jets 
and the rehabilitation of Ghanaian military buildings.  Ghana-China 
relations have been very strong in recent years, as the countries 
continue to exchange high-level and technical visits following 
Chinese Premier Wen Jiabao's visit to Ghana in June 2006 and 
President Kufuor's attendance at the Beijing Summit on China-Africa 
Cooperation in November 2006. 
 
¶3. (U) China remains an important and growing trade and investment 
partner for Ghana.  According to IMF statistics, China was the 
number two exporter to Ghana (behind Nigeria) in 2006.  Ghana's 
statistics submitted to the WTO indicate that China was the number 
one source of imports in 2006, supplying 9.5 percent of all imports. 
 Only about one percent of Ghana's exports go to China, however. 
According to the Ghana Investment Promotion Centre (GIPC), China 
registered the most investments in 2007 (65) in terms of number and 
the second largest in terms of value (about $130 million over the 
life of the investment).  Not all investments that are registered 
with GIPC materialize but the figures are indicative of the level of 
interest China is showing in Ghana. 
 
¶4. (U) China has also financed some major infrastructure projects, 
including providing a $600 million loan to finance construction of a 
400 megawatt hydro-electric dam at Bui in Brong Ahafo.  Chinese 
projects have also included building a large youth center in Kumasi, 
a new Ministry of Defense headquarters, and renovating the National 
Theatre in Accra. 
 
¶5. (U) There are discussions of possible Chinese involvement in 
rehabilitating Ghana's railroad network, but it is unclear how 
serious this initiative may be.  In addition, there is a 
Ghanaian-Chinese joint venture plan to construct a 200-500 MW 
gas-stream combined cycle power generation project near Kpone, and a 
pulp and paper mill at Dabuase in the Western Region. 
 
¶6. (SBU) Chinese involvement in the natural resources sector is also 
growing and merits close attention in terms of environmental 
stewardship.  A Chinese delegation recently visited Ghana to discuss 
investment in Ghana's forestry sector.  Ghana may provide financing 
for aquaculture cultivation of tilapia for domestic consumption and 
possibly for a partnership to produce salt resistant tilapia for 
export to China.  China is also engaged in commercial fishing, 
sometimes intruding into areas reserved for local artisanal shipping 
(ref B). 
 
¶7. (U) China has also sent medical teams to Ghana to perform 
research and combat infectious diseases. 
 
Opportunities for Coordination 
------------------------------ 
 
¶8. (SBU) To date, coordination between the Chinese and U.S. Missions 
in Ghana has been limited.  While there is some contact between the 
Missions, China does not participate in meetings of development 
partners or any of the sector discussions that take place regularly. 
 
 
¶9. (SBU) China is playing a major role as a development partner in 
Ghana, and indeed, is the driving force behind several major 
infrastructure projects that will have a significant impact on 
Ghana's development.  Consequently, we believe there would be 
positive benefits to increased coordination, particularly if China 
were to participate in the regular "sector group" meetings held 
between the government and foreign donors (including in areas such 
as health and education).  However, despite having been invited to 
these meetings in the past, the Chinese mission in Accra has not 
participated in the donor coordination process. 
 
¶10. (SBU) In addition, while we believe increased cooperation would 
be useful, we caution that there have been social and environmental 
concerns centering around some Chinese projects such as the Bui Dam. 
 This project will require significant resettlement of local 
 
ACCRA 00000614  002 OF 002 
 
 
populations and potentially destroy a hippopotamus sanctuary.  In 
addition, because China has brought in a large number of Chinese 
workers for projects such as the recent construction and 
rehabilitation of sports stadiums, there has been a limited impact 
on job creation for Ghanaians.  Our understanding is that the 
Environmental and Social Impact Assessment Study for the Bui project 
was hastily pushed through.  China's involvement in fish farming may 
also raise environmental concerns, as there are indications that 
Ghana may be planning to import GMO tilapia that can reach maturity 
faster.  Such fish can have a devastating impact on indigenous fish 
species if this initiative is mismanaged and the fish escape. 
 
COMMENT 
------- 
 
¶11. (SBU) China is clearly playing an important development role in 
Ghana with major projects centered on infrastructure, and the 
Chinese-Ghana relationship appears to be robust.  While coordination 
between the Chinese and other foreign development partners has been 
very limited, we believe it would be beneficial and will continue to 
look for opportunities to engage the Chinese in Ghana. END COMMENT. 
 
Bridgewater