Disclaimer: The views expressed are that of the individual author. All rights are reserved to the original authors of the materials consulted, which are identified in the footnotes below.
By Keturah Christie
China is currently Africa’s largest trading partner after surpassing the US in 2009. Its rapid economic growth, coupled with the fact that energy consumption and production has grown exponentially, has led to an unprecedented need for resources. Thus, China has begun to diversify its business pursuits in Africa by entering various sectors such as infrastructure, manufacturing and telecommunications on the continent. Despite the fact that China’s engagement fosters some advantageous deals and suggests a mutually beneficial relationship, it has faced criticisms from both African and Western civil societies who regard its business practices as controversial and perhaps even exploitative.
Background
The investment relationship between China and Africa is hardly new, however, the current rate of involvement could not have been foreseen and is largely motivated by the “African market opportunities, competition within China and the presence of a strong entrepreneurial spirit.”[1] Following the emergence of African countries from colonial rule, fourteen sub-Saharan African countries quickly formed diplomatic ties with the People’s Republic of China (PRC). By the 1970s the PRC was providing aid to thirty African countries. In a quid pro quo, African countries supported the PRC for China’s United Nations Security Council seat which they gained in 1971.[2]
On the economic front, between the years of 1981 and 1985, Chinese investment in Africa rose from USD 660,000 to USD 24m demonstrating their growing financial ties. Furthermore, the nature of their relationship has been reformed in recent years - China has shifted it projects from ‘resource-rich’ West African countries (e.g. Nigeria and Angola) to developing Eastern African countries such as Kenya and Ethiopia. Moreover, China’s infrastructure involvement is part of their strategy of soft power with their President Xi Jinping’s recent development, ‘Belt and Road Initiative’ with the aim of linking Europe and Asia as well as East Africa via transportation infrastructure projects.[3]
What does China have to gain?
Primarily, China needs natural resources in order to feed its growing economy - more specifically, oil. 1933 marks the date when China became a net oil importer and preliminary data from the International Energy Agency (IEA) suggest China is now the world’s largest energy consumer. Additionally, the IEA projects China has been involved in since 2008 and continues to be involved in, is said to account for 36% of the total global increase in primary energy use between 2008 and 2035.[4] China hasn’t just been seeing an increase in the demand for oil but also for raw materials to feed its growing manufacturing sector. The need for metals such as aluminium, copper, nickel and iron ore are resources that are abundant on the African continent.
Secondly, African nations serve as a suitable consumer market for China as they have over one billion inhabitants who are interested in reasonably priced consumer goods. The Chinese companies that invest in Africa, also do so in the West for access to larger markets which in contrast to those domestic markets are highly competitive.[5] In addition, by investing in African nations, China can meet the demand for employment and expand its economy by allowing local companies to reach an international market.
Finally, China hopes to add some credibility to her image as a “benevolent superpower” as well as demonstrate its capability to be an equal competitor on the world stage in comparison to Europe and the US. Many African countries have been receptive to the presence of China as a superpower and show willingness to support the idea of ‘The One China’, with many African countries receptive to the idea of cutting ties to Beijing’s rival, Taiwan. This is a notable exception to China’s claims that there are no political strings attached.[6]
What does Africa have to gain?
Infrastructure development remains a pressing need for most African countries, therefore whilst there are some considerable risks from China’s investment in the continent’s infrastructure, it is met with gratitude. Since the 1960’s Chinese companies have built bridges, schools, railroads, telecoms and other developments across Africa.[7] This in turns has aided job deficiencies prevalent in African countries. Also, Chinese economic engagement is deemed especially significant due to the West’s seeming general aversion to investing heavily in Africa’s infrastructure arising from scepticism with regards to perceived levels of African productivity.
Additionally, perhaps it is fair to say that majority of African countries share similar attitudes with China about sovereignty than they do with Western countries who don’t follow China’s dogma of national sovereignty. In stark contrast to China, Western donations often come with an attitude that undermines Africa’s sovereignty, often including a multitude of reform agendas.[8]
What risks are involved in this relationship?
There are considerable steps China has taken to show its commitment to Africa and one significant action is their cancellation of the debt of 31 African countries in 2005 totalling USD 1.7 billion.[9] Whilst many experts then agree that Chinese support is of great value to African nations, it is not without to risk. There have been instances of unfairness and corruption resulting in projects ending up larger and costlier than anticipated. For example, there is a lack of competitive bidding and a suggestion that African nations are paying too much for their infrastructure projects. This is of concern as some of these projects could take several years to pay back and may not yield substantial profits for the African countries.
It is also clear that an economic win-win objective is far less apparent. Both Africa and China’s reliance on labour-intensive export manufacturing industries like textile and clothing reveals little evidence that Africa is even able to compete successfully against the Chinese because many of their exports to China are limited to capital-intensive commodities. Thus, it affects Africa’s ability to create opportunities in China while China has been able to undermine job markets in Africa.[10] Moreover, there are considerable concerns over the environmental damage that may be caused to local communities in African countries. For example, Chen of John Hopkins noted that the Nairobi-Mombasa railway goes through national parklands which is potentially harmful to the country’s wildlife and natural areas.[11]
It is now clear that though the ever-growing relationship between African nations and China brings about fruitful and beneficial economic and political outcomes, a closer analysis reveals the risks and shortfalls in this engagement. That is not to say that the prospect of these dangers manifesting is inevitable but rather that an awareness of them should motivate African governments to ensure that deal by deal they protect national interests and do not end up with the short end of the stick.
[1] Gu, J. (2009) ‘China’s Private Enterprises in Africa and the Implications for African Development’, European Journal of Development Research (21): 570-87 [2] Giles Mohan, Beyond The Enclave: Towards A Critical Political Economy Of China And Africa (1st edn, Palgrave Macmillan 2020) <https://onlinelibrary.wiley.com/doi/full/10.1111/dech.12061> accessed 25 November 2020. [3] 'Africa Faces Some Risks With China’s Investments' (VOA, 2020) <https://learningenglish.voanews.com/a/african-countries-face-some-risks-with-china-s-investments-/4482082.html> accessed 25 November 2020. [4] Gu, J.(n2) [5] Ibid. [6] Tull, D. (2006). China's Engagement in Africa: Scope, Significance and Consequences. The Journal of Modern African Studies, 44(3), 459-479. Retrieved November 27, 2020, from http://www.jstor.org/stable/3876304 [7] Gu, J. (n2) [8] Tull, D (n7) [9] Ibid [10] Tull,D (n7) [11] Voa News (n4)
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