China’s African Safari
Genevieve Curtis explores the paradox of the Sino-African friendship.
Sub-Saharan Africa comprises 49 nations, with a combined gross domestic product less than that of Florida. It is a region whose slice of the global economic pie is shrinking by the day. Worse yet, it lacks the power to strategically negotiate a larger share in the international market. The shifting configurations of global power structures and intensified globalisation in all of its forms have led to burgeoning relations between China and Africa, with China presenting itself as an emerging economic power bloc and a threat to Western hegemony in the continent.
China’s rapid growth is fuelling the need for further resources and Beijing has cast its eye over untapped reserves, of oil particularly. China is the second-largest consumer of oil in the world and its role as the world’s workshop has necessitated what Leni Wild terms the ‘Sinosphere’. Trade between Africa and China has increased by 400 per cent since 2000 and there is no indication of a halt to the flourishing dynamism between the two countries. Some analysts have even given the relationship the hybrid nickname of ‘ChinAfrica’.
Deconstructing China’s African ‘Safari’
There is a danger in judging and deconstructing China’s ‘safari’ through a protectionist perspective. African nations have both the need and right to advance their own economic interests and trade with China, which has expanded their opportunities and economic growth. Many observers agree that China may be Africa’s golden ticket to stimulating a much-needed economic revival. Although 85 per cent of Africa’s exports to China come from oil-rich countries, China’s interest in Africa’s potential extends far beyond the oil barrel. By 2003, trade between China and Africa totalled $18.5 billion. By 2007, it had reached $73 billion. However, the perceived ‘commercial invasion’ has been analysed in terms of a zero-sum competition for resources, a win-win for the People’s Republic.
Observers are noticing a paradigm emerging among the nuances of Sino-African trade. The benefits of Chinese trade and development for Africa are undeniable; yet in what has become a modern-day ‘scramble for Africa’, the question has arisen: is China merely another neo-colonialist power, swindling Africa out of much-needed capital and land?
In what has become a modern-day ‘scramble for Africa’, the question has arisen: is China merely another neo-colonialist power, swindling Africa out of much-needed capital and land?
This particular snapshot of Chinese policy is indicative of Beijing’s implementation of controversial soft power strategies that are drawing the ire of the international community. Predictably, China’s vested interest in African resources, and subsequent no-strings-attached foreign direct investment, has attracted the attention of both the United Nations and other major investors in Africa, as speculation continues to grow regarding China’s motives.
No other major power has shown the muscle, interest or ability to initiate investment in Africa. Elizabeth C. Economy argues that China is merely following an established neo-mercantilist path set by Western nations that implement exploitative trade agreements, coupled with aid and infrastructure, to maintain economic leverage within the region. In 2004, China obtained a major stake in Angolan oil production through the provision of a $2 billion aid package that funded roads, the laying of a fibre-optic network, and the construction of schools, hospitals and offices.
The Politics of Trade and Investment
The China-Africa Summit in November 2006 is a useful case study for deconstructing the politics of the Sino-African relationship. A particularly noteworthy feature of the Summit was the pledge for five export-processing zones that would add value to Africa’s exports. The positive impacts of these plans for the host country are minimal, as Chinese companies will profit from tax breaks and flexible investment conditions within the zones, which will ultimately support Chinese private actors. The fact that many Chinese businesses are state-owned corporations means that they need not turn a profit, so long as China’s overall objectives are satisfied: namely, through liquidating competition and allowing for a Chinese monopoly. China’s state-owned enterprises are powerful agents within the region and fuel Chinese investment in Africa.
Many African states are marred by political and social instability, and China’s presence has posed an additional barrier to internal reform and transparency in business-friendly African governments. For example, China’s $US2 billion ($AU2.4 billion) soft loan to Angola enabled the Angolan Government to resist pressure from the International Monetary Fund (IMF) to implement its requirement of “conditionality” to improve the transparency of its oil sector and to tackle endemic corruption.
The Pitfalls of Trade and Foreign Investment
The impact of globalisation’s homogenising qualities can be seen in the displacement of smaller, localised African businesses in sectors dominated by Chinese investment. Although African consumers benefit from cheaper goods, local African businesses are undermined by an influx of Chinese producers that are outsourcing manufacturing. Chinese labour policies are also attracting criticism from African civil society. Activists in Zambia have condemned Chinese labour practices in Africa, such as low wages and the importation of Chinese labourers, after an accident at a Chinese-operated copper mine in 2005 killed 50 Zambians.
China potentially holds the key to an economic revival of the African continent; however, Africa’s internal problems must be addressed to reap the benefits of Chinese investment fully.
One is tempted to view China, with respect to its exploits in Africa, as a ruthless, neo-communist power, covertly establishing itself as a threat to Western, hegemonic power blocs. However, one must also look through the lens of African nations themselves to comprehend the benefits of this new Silk Road.
The Promise of Trade and Foreign Investment
The political climate of many African governments has enabled an escalating exchange of goods between the two nations. As more African nations focus on the privatisation of their industries and the opening of their economies to foreign investment, China has capitalised upon this opportunity. In 2006, Premier Wen Jiabao declared: “China has been developing relations with Africa under principles of mutual benefit and non-interference in Africa’s internal affairs.”
Africa registered 5.8 per cent economic growth in 2007, its highest record since 1974, in part because of Chinese investment. No one can deny the beneficial effects of Chinese investment upon this economically challenged region. The majority of Chinese firms in Africa are involved in transportation and electrical and communications infrastructure. For example, Huawei, a major Chinese telecommunications company, won contracts worth over $400 million to provide cellular phone service in Kenya, Nigeria and Zimbabwe.
In November 2004, China established the China-Africa Business Council (CABC) in conjunction with the UN Development Program, to support China’s private sector investment in sub-Saharan Africa. This will inevitably lead to further sustainable development for the region. The added pressure of a United Nations body in the proceedings will undoubtedly influence China’s choice of trading partners, particularly when taking into consideration human rights records and transparency in government activity.
There is no doubt that China’s activities in Africa have provided crucial economic development to some dangerously underdeveloped countries and sectors. However, an analysis of China’s modus operandi in Africa cannot be isolated from its political implications.
The Cost of Putting Economics First
China’s interests in Africa extend beyond the economic sphere; strategic interests really lie at the heart of Beijing’s foreign policy. Whichever political lens is used, Sino-African relations have a contentious dimension: namely, the issues of human rights and corporate responsibility. As Sierra Leone’s ambassador to Beijing, Sahr Johnny, articulated: “we like Chinese investment … because there are no benchmarks or preconditions.”
Analyst Jonathan Holslag has argued that Beijing is ultimately driven by intransigent economic ambitions and that China’s African policy is designed to protect its economic interests, irrespective of the political consequences. China is one of Sudan’s leading arms suppliers and has thus indirectly supported regional factionalism and resistance to UN peacekeeping in the Darfur region.
Leni Wild argues that the quid pro quo relationships between China and various African nations have resulted in one or both nations turning a blind eye to each other’s human rights records and government transparency. China, through its role on the UN Security Council, maintained an obstructionist position on Darfur, until international condemnation necessitated an about-face. Analysts have argued that this stemmed from economic and diplomatic ties with Khartoum. Various experts independently confirm that Chinese small arms were used on various sides of the Darfur conflict, with the registered delivery of 600 firearms to Sudan from China in 2006.
Official diplomatic communications between the Chinese and African governments amplify the anti-Western rhetoric of many African governments. China has a strict non-interference policy and, consequently, as Henning Melber explains, China represents a welcome break from European and American investment, which is subject to “conditionality”, or policy adjustments, as stipulated by the IMF. Zimbabwe’s President Robert Mugabe has captured the sentiments of many African leaders in stating, “we look to the East where the sun rises, not the West where the sun sets”.
Humanitarian crises in unstable African states have kindled public awareness of China’s role in the region. Beijing has begun to respond to international criticism of its corporate engagement and practice of turning a blind eye to human rights abuses, by relaxing its ‘non-interference policy’; however, Beijing’s corporate governance is still controversial.
China potentially holds the key to an economic revival of the African continent; however, Africa’s internal problems must be addressed to reap the benefits of Chinese investment fully. Accordingly, Beijing must further appropriate its foreign policy to address the issues of democracy and human rights involved in African trade.
The ‘friend or foe’ hype regarding China is raging in international fora. China is attempting to balance lucrative commercial prospects in Africa with its requirement of global governance. China’s relatively isolationist foreign policy has attracted international criticism and Beijing is slowly attempting to rectify its reputation in international circles. Ultimately, African civil society is poised to see if China’s aggressive interest in its continent will differ from that of the colonial powers of eras past.
Leave a Reply