The Ministry of Commerce on Monday launched the China-Africa Research Center, a think-tank focused on the economies of the two regions, to further bolster trade relations with Africa.

The think-tank has been set up under the auspices of the Chinese Academy of International Trade and Economic Cooperation, a subsidiary of the ministry.

The new unit will utilize ministry resources and discuss and deliberate on key economic issues about African nations. It will also provide the government with theoretical clues on future policies for Sino-Africa economic and trade ties and help Chinese companies planning ventures in Africa with consultancy services," said Fu Ziying, vice-minister of commerce.

Huo Jianguo, director of the Chinese Academy of International Trade and Economic Cooperation, said in the next three to five years, the center may become the most important think-tank in the nation providing economic and trade policy solutions."

China's outbound investment in Africa has gained strong momentum recently, especially in sectors like manufacturing, finance, mining and agriculture. But very few know much about African nations and rarely possess global vision and strategic thinking. This often leaves a bottleneck in bolstering China-Africa economic relations, said Fu.

In 2000, China-Africa trade surpassed $10 billion, and during 2002-2008 period, bilateral trade kept growing by 33 percent every year. Although the figure declined in 2009 due to the financial crisis, China-Africa trade is expected to inch up to above $110 billion this year and likely to grow by around 20 percent in the next three to five years, said Huo.

Given the good prospects for bilateral trade, the establishment of the center comes at the right time, and will strengthen economic and trade relations," said Huo.

At present, there are very few offices under national academic institutes that study African economic issues. The new Center has 10 senior researchers, and the number will double in next two years," said Li Guanghui, director of the center.

Thanks to its growing consumer market and rich natural resources, Africa is becoming an investment hotspot for developing and developed nations including the United States and European Union.

According to the United Nations Conference on Trade and Development, the world's foreign direct investment in 2009 dropped by almost 40 percent, but the FDI flowing into Africa fell by only 19 percent.

"China must improve its understanding about Africa as soon as possible to cash in on the growing business opportunities," said Li.

By the end of 2008, China's investment in Africa reached $26 billion, with most of the funds flowing to nations like South Africa, Sudan, Zambia, and Algeria.

In 2009, China's investment in Africa was $1.36 billion, up by 37 percent and accounted for 4 percent of the nation's total outbound investment last year.

"China should have set up mature systems for researching African issues much earlier. But fortunately, it has now taken the right step," said Chen Gong, senior partner of Anbound Group, a leading consultancy institute.