Business
Why is the West so worried about China’s engagement with Africa?
In Angola, for example, China’s low-interest loans have been tied to a scheme that has ensured that roads, schools and other infrastructure has been built.
China has an impressive track record of lifting its own millions out of poverty and can do the same for Africa. And is the West’s record in Africa as glowing as we like to think? After decades of pouring aid into Africa, how much have we actually achieved in terms of reducing poverty, corruption and war? So which way should Africa look for salvation – to the West, to China, or perhaps to its own people?
China is not an ordinary nation. With a population of over 1.4 billion, China has been in existence for over 5,000 years and is the world’s oldest centralized state. Therefore discussing its relations with any region of the world, including Africa, should be done with great humility. This comprehensive coverage, discusses how Africa stands to gain from a strong, effective and balanced relationship with China. The Chinese resurgence in Africa is not only transforming the continent’s political, economic and social landscapes, but is sending nervous shivers into Western governments, hitherto the dominant forces in Africa. But the ball is now in Africa’s court, to fully embrace the new-kid-on-the-block, or hang on to friendships and policies by maintaining the status quo. This time, Africa needs to play its cards right.
China has surprised everyone. It has created a fait-accompli, not storming Africa as would have been expected from a dragon, but getting into it in a powerful but cautious way. The world woke up in 2006 to face the extent of China’s return to a continent it had virtually deserted for some years. Its resurgence in Africa even caught its traditional Western protagonists off-guard and they are worried – with good reason.
China’s money flowing into Africa is a clear and significant sign of its determination to meet words with deeds on the continent. A symbolic signal in this regard is the fact that in 2007, with over US$9bn worth of investment, it dwarfed the World Bank‘s money flow into Africa, and the Bank, unable to inject more than $2.5bn into the continent, is now, bowl in hand, persuading Beijing to partner with it in financing African projects, so far to no avail.
When one takes into account the huge foreign reserves, now estimated at $1.5 trillion, that it has built as a result of an effective export strategy and the establishment of a sovereign fund – the China Investment Corporation – endowed with $200bn, one can easily expect China to be more than ever the most dominant player in a continent that needs financial resources, which China is ready to provide without conditionalities.
With more than 800,000 Chinese currently living, working and running businesses in Africa, over 800 small and medium businesses involved in manufacturing and bidding for construction of ports, railways, hospitals, administrative buildings and other facilities, usually at a very competitive price, and using comparatively advantageous cheaper labor and other factors of production, it is no surprise that many Western actors with interests in Africa are taking notice of China in Africa, and yes getting very edgy.
Not only do China’s strengths justify this uneasiness, but the fact that China has come up with an economic and political development model that seems to have produced tangible results in terms of poverty alleviation and national control of assets, makes the country more appealing to most African countries.
