8 September 2013

Africa: China in Africa - How Much Do We Know?


The West is worried about Chinese investments in Africa. Some western officials even make veiled references to the danger of Africa's "new colonialists". Some others still warn Africans about the risks of partnering with the authoritarian China. But, Why?

Everyone knows that the Chinese are aggressive newcomers to Africa, only interested in resources, including land to feedChina's growing population. They bring in all their own workers in countries desperate for employment. Yet, much of what "everyone knows" about Chinese investment inAfricais simply wrong.

In July, 2012, as rain beat down on the roofs of the Chinese-run Eastern Industrial Zone (EIZ), outsideEthiopia's capital, Addis Abeba, I walked along the production lines where more than 800 Ethiopian workers are producing shoes for major American labels. Attracted byEthiopia's quality high leather, Huajian - one ofChina's largest shoe factories - is part ofChina's own nascent globalisation.

Just down the road, a manager at Sino-Ethiopian Associates explains that a pharmaceutical joint venture, launched in 2001, was one of the first to produce drug capsules inAfrica. Several kilometres away, David Huang's seven hectare farm produces vegetables for the growing Chinese population. Stitched together from small plots negotiated from 15 local farmers, his is the largest Chinese farm inEthiopia.

Ethiopiarepresents much of the reality of Chinese investment below the headlines. Are the Chinese leading a land grab inAfrica?

Researchers from the California-based Oakland Institute, who did months of fieldwork inEthiopia, were surprised to find no large-scale Chinese agricultural investors. Experts from the Centre for International Forestry Research (CIFR) travelled to theCongoto check out a widely circulated story about a 3m hectare Chinese palm oil project. Again, they found nothing.

My own research at the International Food Policy Research Institute (IFPRI) discovered that, fromMozambiquetoZimbabwe, stories about alleged Chinese land grabs turn up very few actual projects. This is aside from several dozen Chinese-owned farms producing for local markets inZambiaand a handful of long established sugar and sisal plantations purchased in the 1990s, duringAfrica's era of privatisation.

"We're getting lots of investment fromIndia," the head ofEthiopia's commercial farming promotion office told me. "But, not fromChina."

Do Chinese companies bring in all their own workers?

In a small number of countries where local labour is expensive, such asAlgeria,Libya, evenAngolaandSudan, Chinese construction companies with infrastructure contracts have brought in large Chinese crews. Yet, inEthiopiaand most other parts ofAfrica, Chinese managers direct teams of local employees.

Huajian, for instance, brought in nearly 200 skilled Chinese workers to kick-start their production lines, while training more than 800 Ethiopians. SEA started production in 2002 with 15 Chinese engineers.

Today, the production manager is Ethiopian and a single Chinese engineer remains, along with a skilled local staff of close to 100. The main complaint from Africans is not that they aren't finding work with Chinese companies, but that wages and working conditions are often worse than they had expected to find within a foreign firm.

Chinese companies, like Western firms, are certainly interested in African resources, and sometimes, like Western firms, work in countries ruled by unsavoury regimes that do not respect human rights or elections. Yet, although a Hong Kong firm, PetroTrans, won an oil exploration concession,Beijinghasn't bothered to look for oil inEthiopia.

China's largest economic partners on the continent include stable, democratic South Africa, Mauritius and Ghana, whereas Chinese firms have invested in banks, factories, telecoms and, more controversially, small shops. Chinese infrastructure projects are knitting the continent together, from wireless networks to roads and bridges.

Rather than "fear" the Chinese invasion, the West should take a more constructive and informed interest in what the Chinese are really doing to take advantage ofAfrica's multiple business opportunities. We should assess more carefully the benefits and challenges of Chinese investment. And we should give Africans not just warnings, but more credit for taking their own development decisions.

Deborah Brautigam Deborah Brautigam Is a Professor and Director of the International Development Program Atjohns Hopkins University,United States. 

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