What does China’s forays portend for Africa?

What does China’s forays portend for Africa?

Antony Mutunga

Relations between China and all African countries were established and have been promoted based on sincerity, and growing Africa-China ties are just what the African continent needs for development – Moussa Faki, AU Chair

Nowadays, the Chinese communities are in every African country: The plan is to take some of its population and put them in Africa, while Africans just look on and African leaders hold fruitless meetings – The late Muammar Gaddafi

Ever since the colonial period, Africa has been at the mercy of West as the continent has been heavily reliant on the region in terms of aid. This has seen the continent grow but, in the process, it has also left the African countries highly dependent on Western countries. This has seen the West not only be involved in the economic affairs of Africa but also in its political affairs as well.

However, in recent years this seems to be changing as the East’s presence in Africa has been growing at a faster rate compared to the West. For instance, according to Ernst & Young’s (EY) Africa Attractiveness Report 2017, China’s investments in Africa between 2005 and 2016 totalled an investment outlay of $66.4 billion (Sh6.9 trillion). This has seen some African countries shift their gaze from the West to the East as China changed from being a small investor to being a major economic partner. With trade between China and Africa expected to increase by 20% every year, soon Africa will turn into China’s second continent.

China’s investments to Africa have been crucial as they have helped many African countries develop to new heights thought impossible at the time. Over the last two decades more than a million Chinese have moved to Africa and with them, gifts that would see the African economies grow. There gifts were in the form of a wide array businesses, such as construction companies, which they established in the African countries thus helping them to develop further.

An example would be the Chinese construction firm Wu Yi in Kenya which has helped in developing infrastructure such as roads and bridges. Another example would be the Yocean Group Limited which established Kenya’s first transformer-manufacturing plant. The case has been the same all over the African continent as China slowly evolves each relationship it has with African countries.

Apart from helping the African economies by bringing more businesses into the continent, the Chinese have also helped in the employment sector. As they bring in a different set of businesses into Africa they also bring in job opportunities for the natives thus helping reduce the high unemployment rate that has been a major problem for most countries. For example, in Kenya the rate of unemployment stands at 39.1 per cent, according to a report by United Nations; Human Development Index (HDI) 2017.

However, with the Chinese aggressively investing in Africa, the unemployment rate might soon start to decline. For instance, according to the report by Ernst & Young’s (EY), between 2005 and 2016 China has invested in over 290 FDI projects in the African continent, creating 130,750 jobs.

Helping develop Africa has seen the East get welcomed with open arms by many governments on the continent. The success of China can be accredited to its adaptation of the China Model/Beijing Consensus that has come as an alternative to the US’s Washington Consensus, which has been slowly crumbling.

The Washington Consensus, which is a set of economic policy recommendations aimed at helping developing countries, was established to advocate free markets so as to help developing countries grow. Even though it has been helpful to most developing countries especially in Africa, it has been heavily criticized as not always having the best interest of developing countries and it leading to the interference by West on the economic as well as political matters of the developing nations. On the other hand, the Beijing Consensus, which was established in 2004, has a ‘no strings attached’ policy which sees the East refrain from interfering with matters of the countries they help to develop, or with which they do business.

Despite this helping the East’s presence to grow in the African continent and assisting African countries to develop faster, there is still the thought that this assistance in aid and development is a double edged sword. Africa is not a stranger to exploitation, after many years of colonial rule, many Africans are sceptical to believing that the East’s assistance comes at such a minimum cost.

China has become Africa’s largest trading partner, providing demand for the continent’s raw materials. In return it exports cheap manufactured goods back to the trading partners, provides foreign direct investments as well as loans and also helps to construct needed infrastructure. This has truly helped spur development in Africa. However, at the same time, it has seen the continent’s trade balance with China move into the deficit. According to the China-Africa Research Initiative (CARI), In 2015 Africa recorded a $34billion (Sh3.43 trillion) deficit with China on a total trade of $172 billion (Sh17.37 trillion) – it has handicapped the developing countries but is advantageous to China.

In addition, the goods that come from China tend to flood the African market thus leaving local producers overwhelmed. The imported goods are usually cheaper than local goods hence causing local producers to end up with major losses as the public prefer imported goods. An example would be the case of fish in Kenya. According to statistics from the Kenya National Bureau of Statistics (KNBS) fish imports from China grew by 60.2 per cent to Sh1.02 billion in 2015 compared to Sh624.1 million in 2014.

China has also been helping Africa by funding some of its infrastructural projects and even though this is helping develop the African economies at the same time it denies local companies and citizens the chance to grow in terms of experience and income. Local companies end up losing on the opportunities to take up the projects which leads to the Chinese firms benefiting as they acquire the massive profits. For example, in 2016 China Railway Construction Corporation (CRCC) announced over $5 billion (Sh506 billion) in contracts within Africa.

The level of trust between Africa and China is also shaking up after the African Union (AU) was rocked by allegations that China had bugged their headquarters in Addis Ababa, Ethiopia. This is after AU discovered that data from their computers was being sent to Chinese servers since the day the building, which was also built by the Chinese, was opened back in 2012. Even though China has come out to deny the allegations, there is a definite strain in their relationship.

These factors have brought up the question of if China is truly a partner to Africa or if it is establishing itself as a new colonial power. China through Wang Yi, China’s former Foreign Minister, ensured Africans that it will not take the old path of Western colonists and neither will it sacrifice Africa’s ecological environment and long-term interests. It is true that China’s interest in the continent goes beyond altruism, even as it is conceded that both parties do benefit, however skewed the benefit.

The increased presence of China in Africa is helping the continent to develop further; however African governments need to be careful how they handle this relationship. As things stand, it is not long before the dragon becomes the new king of the African jungle and if not handled well by African leaders the result may be very negative. ^

Leave a Reply

Your email address will not be published. Required fields are marked *

Sign Up