‘Learning from China’: Neglected perspectives on Chinese investment in Africa
Submitted on: 2007-05-09 23:12:55
By: annaw84
Abstract: A discussion of Western approaches to the economic interests of China in Africa
Main Article:
Trade between Africa and China has grown massively in recent years, reaching £18bn in the first 10 months of 2005. Just over half this figure represents African exports to China: mainly the raw materials required to fuel China’s massive economic growth. China accounts for 40% of world demand for oil and oil-rich African countries such as Sudan and Angola have benefitted particularly from Chinese trade. Expanding trade, coupled with China’s recent threat to veto sanctions on Sudan, have reawakened Western interest in the relationship.Western critics raise several concerns regarding China’s interest in Africa. The first relates to China’s disregard for human rights and record of supporting corrupt regimes, including arms deals with Zimbabwe, Eritrea and Sudan. Secondly, China’s desire for natural resources such as oil and timber raises questions about how much of the profit will reach local agents, with most extraction under Chinese management. China’s record of supporting unsustainable extractives industries, notably in neighbouring Burma/ Myanmar, belies its proffessed concern for environmental issues. It is also argued that China’s policy of non-interference in domestic affairs allows corrupt leaders to evade the ‘good governance’ condition of IMF and World Bank loans. Finally, critics are concerned about China’s part in ‘dumping’: Chinese textile and steel industries compete with African products, prompting concern that cheap imports will undermine African industry.
So, is China simply the latest in a series of ‘neo-colonial’ powers exploiting Africa? Many African newspapers also focus on the relationship. However, there is an emphasis neglected in Western commentary: many argue that Africa should learn from China’s model of development. China represents economic protectionism rather than the neo-liberalism espoused by the Bretton Woods institutions. Chinese policy of non-interference in domestic affairs represents a return to the Cold War funding model, when the eagerness of all sides to win allies led to unconditional investment in Africa. As an Abuja-based journalist points out, Africa and China diverged economically in the 1970’s. China promoted state-run domestic industry in partnership with private enterprise and production and trade tariffs, resulting in massive growth. Meanwhile, many African nations were forced by plumeting primary commodity prices, coupled with the end of the Cold War, to accept the West’s privatisation and free market agenda. Many argue these policies have contributed to the decline of many African economies since.
While the argument that Chinese investment could led to non-conformity with governance standards is valid, corruption among African leaders has actually risen since liberalisation and democratisation. Moreover, this argument sidesteps the issue that non-conditional investment in Africa from China might finally allow African countries to negociate on the economic policy at the heart of Bretton Woods investment.
Furthermore, concern about natural resource exploitation is not confined to Western NGOs. Recent kidnappings of oil company workers in the Niger Delta by activists protesting against the lack of investment of oil profits in the local economy forced the government to promise extensive investment in the area. Recently, several concessions, including in the Delta area, were removed from companies such as Shell and Total and reallocated to Chinese firms. Being forced to compete for oil contracts might have more effect on promoting good practise among both Chinese and Western firms than voluntary initiatives.
Chinese investment in Africa undoubtedly raises important concerns. However, the point that significant investment from China could give African governments the power determine their own economic policy for the first time in decades, and regain jurisdiction over competing foreign firms, should not be neglected. ‘Learning from China’ is the opposite to accepting Chinese dominance. Western critics should recognise that African leaders are under pressure from their media and public to use Chinese investments for national development and should assist in this process rather than merely condemning Chinese policy and perpetuating the image of Africans as helpless victims of exploitation.
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