Chinese trade with Africa - good or bad news?
I’m a firm believer that a positive transformation of the African continent will come from increased trade, both between African nations and with other continents. But it’s hard not to have mixed feelings about the news that trade between China and Africa has increased 39% over the last year.
Much of the China/Africa trade involves Sudanese oil. Now the world’s second-largest consumer of petroleum, China has been investing heavily in oil infrastructure around the world. This includes a pipeline that brings oil from Sudanese oilfields to a terminal in the Red Sea, representing 10% of China’s total oil imports. Peter Goodman of the Washington Post reports that Sudanese troops have been given rifles, tanks, helicopters and other weapons by the Chinese government to protect this pipeline, and that Chinese assistance has helped Khartoum build three munitions factories. It’s highly likely that these weapons have been used in the government’s struggles against rebel groups in Darfur. When free trade advocates suggested that African nations trade more widely, they probably weren’t advocating trade that included transfers of arms to a genocidal regime.
While countries like the US have accompanied trade and aid to African nations with economic advice and policy prescriptions, the Chinese government has been content to stick to trade issues in many of their negotiations. From Goodman’s story:
In an interview in Sudan’s capital, Khartoum, Energy and Mining Minister Awad Ahmed Jaz praised his Chinese partners for sticking to trade issues.
“The Chinese are very nice,” he said. “They don’t have anything to do with any politics or problems. Things move smoothly, successfully. They are very hard workers looking for business, not politics.”
As Abe McLaughlin of the Christian Science Monitor has pointed out in his reporting about China’s influence in Africa, this willingness to stick to business issues has made China a popular trading partner with nations like Zimbabwe, which experience strong human rights pressures in other trade relationships.
Chad, Sudan’s neighbor to the west, has also seen its economy transformed by the discovery of oil. Exporting this oil required a pipeline to Cameroon, which the World Bank financed with a loan in 1999. Attempting to ensure that oil revenues would be used for education and health projects, not for military expansion, the World Bank required that 10% of all revenues be put into a fund that could be used only for human development. At the time of the deal, it was hailed a “new model for natural resource development” in Africa.
Now facing increasingly tense border skirmishes with Sudan, the Chadian government has changed its policy and is now allocating some of the reserved money towards “other priorities”, which include defense spending. The World Bank has responded by suspending all lending to Chad, attempting to pressure President Idriss Déby to honor the original agreement. (VOA has a good story on Chadian reactions to the World Bank decision.)
It’s admirable that the World Bank is attempting to ensure their investment has the social impacts it was intented to have… though it’s worth noting that lots of smart people doubted the efforts to sequester oil profits into this account would work. But it’s worth asking this question: What happens when African leaders are faced with the choice between doing business with a partner that asks no questions versus one that uses investment to create pressure for social change? If Déby were building a pipeline now, rather than in 1999, it’s reasonable to speculate that he might have looked to China, not to the World Bank and IMF for funding.
If you’re interested in this topic, please see my earlier post “Haier, Huawei and the new Scramble for Africa”.
January 9th, 2006 at 2:40 am
The answers are pretty obvious, no governement wants outsiders to ‘interfere’ with ‘internal’ politics. African governments are no different, but the US/EU/World Bank carrot/stick policies in Africa have miserably failed. Why? Because no amount of economic pressure can topple an African governement, for they have (almost) all weathered the worst of crisis be it famine or civil war. And none of the big powers want to go through what the US saw in Somalia (or the french in cote d’ivoire), military intervention is simply out of the question for all but the UN at this point.
This status-quo until now only helped corrupt African regimes maintain while humanitarian aid organizations flourish.
The chinese simply saw a pie that no other big power could touch, and along with that a way to reduce their dependance on oil from the middle east (hence the US).
No doubt this new world order for Africa is a disaster in the making, the stakes are too high for all powers involved, the west needs the chinese as much as the chinese need Africa. And once again, it’ll be the poor african farmer who’ll be left holding the bag, waiting for the next airdrop from monsanto.
January 9th, 2006 at 11:31 am
Monsanto doesn’t do airdrops of food the last time I checked, but they do teach farmers in Africa and around the world how to better manage and protect their crops and increase yields (yes, this includes the use of the latest bio-engineering science).
A very good and timely question re: increased Chinese government and private sector investments in Africa. In addition to some of the references used above in your post, I would also recommend reading Dr. Chris Alden’s March 1, 2005 article for eAfrica (SAIIA) titled “Leveraging the Dragon: Toward an Africa That Can Say No”. The article can also be found at Yale University’s Yale Global Online site. Do a Google search of the terms China Investment Africa and just start reading. Don’t miss Mongabay.com’s “Timber Hungry China moves into Africa” (April 19, 2005) or the U.K.’s Channel 4 News Special Report “The Chinese in Africa” (July 4, 2005)
China’s “no questions asked, no interference” investment policies and practices in some African nations should be very disturbing for many people, especially for African business owners and civil society (workers). China’s support of rogue government leaders and repressive regimes, corrupt politicians and civic leaders, and a variety of other crooks and lowlife scum that suck the blood out of the continent is indicative of China’s intent in Africa. This newfound Chinese Goodwill toward Africa makes a loud sucking noise like a giant Hoover.
Dr. Chris Alden’s (London School of Economics) advice for Africa’s (and China’s) political and business leaders should be well heeded, but I doubt that it will be. Enter the Dragon: Greed is Good.
January 9th, 2006 at 4:11 pm
Ethan - Your excellent post highlights the difficulties that the World Bank in particular, and the West in general, in bringing pressure to ensure that oil revenue in poor countries really does benefit poor people. As you note, increasingly if the West does not want to play others (especially China) will.
But I suspect that even China could be encouraged to play by the rules if the rich countries could get together and agree on some. It’s not enough to have the World Bank set the conditions, the rich countries that run the Bank and buy most of the world’s oil should insist that their multinationals fully disclose their financial transactions with developing country oil exporters.
Nancy Birdsall has written an good Op-Ed for the LA Times suggesting this and some other common-sense steps for overcoming the oil curse. It’s featured this week on the home page at the Center for Global Development (CGD — http://www.cgdev.org )
January 16th, 2006 at 7:22 pm
[...] - Jen Brea over at AfricaBeat has an amazingly comprehensive roundup of articles on blogs and in the mainstream media about China’s role in Africa. It includes several that I’ve linked to (and one that I’ve written) as well as some great pieces I hadn’t found. It’s an excellent starting point for someone trying to understand this issue. [...]
May 2nd, 2006 at 4:52 pm
Twenty years ago, I wrote an essay about Chinese interests in Africa. You need to understand the historical perspective starting in 1953 of China’s involvement in Africa. You may be surprised to know that unlike the US, France and Britain, where security concerns, and geo power politics where the motivating factors, China does see Africa as an equal partner. Many of the commentators or countries that complain today, do so because they see a decline in their once traditional monopoly on African countries.
November 8th, 2006 at 9:11 pm
Africans can only benefit from more trade and exchange with anyone that is willing to be business partners, not to colonise.
Lighten up and give China a chance. After all, the West has had theirs for 150 years, and they hadn’t learn to be civilised and not exploit their poorer brothers.
So far, China’s past 50 years record is on balance much better. Africans like me would rather not base on ideological conjecture of morality, but on hard factual results of improved lives. And on this count, CHina is doing so far so good.
Less sour graping is my sincere advice to the West. Redeem your past misdeeds by joining in to help Africans, instead of withdrawing as in the last 5 years. Aid and enggement has been cut since then from the West. Africa is open to all, including the West. Only don’t expect special treatment. Competition from China is good for your businesses and soul!
January 14th, 2007 at 9:03 pm
There is an irony here. An irony that clearly connect the destiny of the African people with that of the Chinese. An irony that clearly shows that Africans will benefit from the paradigm shift.
Why not the Chinese? Why Europe and America are still busy punishing Africa with the image of a child with bone in his nose syndrome, while people of African descents are being told that their past were so bad it’s un repairable, while Europe and America continued to plant into the minds of their peoples that Africa is nothing but war-like areas with hyena and lions roaring around the street, the Chinese has found a new love and a virgin place for development. Areas that the US and other European countries thought to be inhabitable and unfriendly to development are now the new heaven. Whatever is the intention of the Chinese—this is not 1940’s but 2007—Africans now know better. Some day Africa people will be able to look Europe and America in the face and say ‘I think I told you’
February 8th, 2007 at 9:46 pm
hey black people,no one gives a shit about us blacks!
they are all the same.you are leting them take over?
because of penuts? watchout!!!!we are the most hated and underlooked race on this planet!! no one likes
us!! wakeup!! they are going to take everything..
CHAINESE?????!!
February 8th, 2007 at 10:02 pm
WE ARE VICTIMS BROTHERS AND SISTERS.AFRICA HAS MADE THIS WORLD RICH! WE DONT GET IT!WE WERE EVEN SOLD US SLAVES NOT ONLY IN THE AMERICAS BUT US FAR US CHAINA.
THEY DONT CARE ABOUT US,NEVER NEVER NEVER!!THEY ARE ALL WHITE SKINED!!!FOR THEM BLACK IS STUPID,PERIOD!!
February 9th, 2007 at 4:58 pm
The patronizing and demeaning way in which the western leaders, media and istituitions lecture africans as if they are small children or stupid is both counterproductive and regressive. Africa is not one country, neither is it riddled with 900 million starving, AIDS ridden malnourished helpless souls as the western media like to portray. Yes there are big challenges, but there are also multiple successes. There are many countries whose economies are growing at rates comparable with those in Asia. Countries like kenya, botswana, south africa to name but a few are now democratically run.
The west has in the last two hundrend years done alot of damage in africa, starting with slavery, colonialism, support of dictators like mobutu in congo who was installed and maintained by the C.I.A during the east west rivarly etc etc. Did you know for example that Idi amin was appointed and trained by the british colonial authorities to fight in kenya to suppress the popular african uprising against the brutal colonial regime? Indeeed the tactics he learnt were the ones he would use later in Uganda. Jonas savimbi, the slain guerilla leader in angola was armed by the Americans and the apartheid regime. The french in their so called francophone africa fared even worse.
After this , the west dictated through IMF structural reforms which heve failed miserably and have been abandoned.
The future of Africa lies with Africans. Leave them alone to determine who they may choose to trade with or not. It is their resources. After all, the west does not invest in Africa like the chineese are doing. All they sing about in their Davos meeting is just Aid. Africans are tired of being treated as beggars. China invests in infrastructure to help africans help themselves and also to help the chineese.
February 9th, 2007 at 6:23 pm
It is amazing that Blacks all over the world are still treated as a subrace and hated by all other cultures! Since the African Slave trade, that everyone wants to negate, or forget like it never happened. ‘Even we Blacks with bling and finacial clot in America, are still to busy trying to reach some white euro/american dream?Wake-up! Now is the time to forget about these false illusion of a world of deception, deciet ,and foolsih folley.The only redemption for us Blacks now is to stop the second wave of colonialization’s of the Motherland’Because the Chinese want to use a different stradgey but its all the same;the explotation of the African people who are the true land owner’s. Lets unite and protest to our leader’s and stop the raping of the natural resources that the Chinese are coming for the benifit of there own people.This time its not the bible in one hand, and the gun in the other’! But it’s the deguise of investment and fast cash, with their eye on the Gold, Diamond’s and all other natural resouces, and the entire Contient of our Great Africa land! Stop this Dragon’s varcious crime. If not,you will never know Africa as it is, it will be a Chinese outpost!!!! Wake-Up!!!!!
February 20th, 2007 at 1:51 am
[...] Ethan of My Heart’s in Accra recently posted a piece on China asking "Chinese trade with Africa - good or bad news? "I’m a firm believer that a positive transformation of the African continent will come from increased trade, both between African nations and with other continents. But it’s hard not to have mixed feelings about the news that trade between China and Africa has increased 39% over the last year." [...]
June 4th, 2007 at 6:55 am
China is not a partner of Africa. There only exists a buyer-seller relation. Dictators in Africa do not want long-term development in African countries; they only want total controls. The dictator is China is also very short-sighted. It only wants natural resources, not the manpower of Africa, cause China already has too much of the latter.
What if the natural resources of Africa become exhausted one day? What happen to common African people? Is Africa industrialized? Do Africans have sufficient education and skills to survive without any natural resources or foreign aids?
A good China-Africa relation only means exploitation of common Africans and natural enviroment of the planet. Such distorted economic development from the trade of natural resources will only speed up the collapse of Africa as the only place on earth that can still host a large variety of animals and plants. This will be followed by the collapse of planet earth as a unique planet that can host living organisms, including human beings!
June 4th, 2007 at 12:16 pm
When will the westeners learn that because of thier history with Africa. That the Africans simply do not trust them(the west), it doesn’t take a genuis to work that out. A lot of Westerners cannot get to grips with this uncomfortable reality but it is the truth. So saying to the Africans that China is going to exploit them coming from nations that have done the same for centuries wears a bit thin
March 7th, 2008 at 1:32 pm
china is doing better than any who want develop African it doesnt mater how good is western policy in Africa is disaster thy want African always dependent on them thy want to tell you what to do even if you go by their rules they will give you gift not investment in the other hand chines thy don’t force you what to do why thy understand democracy didn’t come from out side like gift it comes from inside
March 26th, 2008 at 12:40 pm
Who gives a shit about 300 years ago anyway? The way to address the African situation is to pray for selfless leaders across African that have ideas. Like the case of Nigeria, a mere good intention from Obasanjo and the current Yar’dua is not enough. We need bold leaders that understand that localizing power supply is the best way forward, localizing water supply, telecomm, transportation and allowing or empowring individuals to provide these services is better than having a govt run NEPA with headquarter in Lagos attempting to provide electricity to Maiduguri—a thousand mile away.
So, Nigeria is the size of Texas…how do you think they run infrastructure in Texas? By localizing it and empowering individuals to run it…only because it has been proven over and over that govt…anywhere in the world is incapable of running any services effectively.
As soon as you have your infrastructure properly in place, then you will begin to attract the likes of AT&T, GE, Ford, Pacific Life, IBM, Microsoft and these company will hire Africans, build a middle class and increase standard of living.
The question is: Is good intention all that we need in Nigeria or Africa. Good intention has to be cummed with ideas. Ask questions such as what are we doing wrong? Why does power stays on in Holland and Denmark and not Abuja. Can we at least develop Nigeria to the level of Holland or Denmark?