We heard a somewhat mystifying comment from U.S. Secretary of State Hillary Rodham Clinton last week warning of a “new colonialism” in Africa from foreign investors and governments interested only in extracting natural resources to enrich themselves.
No culprits mentioned in that statement, but a day earlier Clinton urged scrutiny of China’s large investments and business interests in Africa to prevent African people “being taken advantage of”.
Now, let’s analyse those comments carefully.
Denotations – China extends its grip over Africa
If we strip the semantic connotations of Clinton’s proposition, we’ll end up with a somewhat factual denotation – China’s grip is extending gradually, but unequivocally, throughout the African continent. That much seems to be true.
Because, propelled by a desire to secure natural resources, tap into new markets, and find cheaper offshore manufacturing facilities, Chinese state-owned enterprises have made large investments throughout Africa (which, nevertheless only represented a 3 to 4 percent of total Chinese outward foreign direct investment (OFDI) worldwide) in 2011.
China has also recently become Africa’s main trading partner. Trade between the two sides hit a record $166-billion in 2011, a threefold increase since 2006, while direct investment amounts to $14.7 billion. China has undertaken major public works projects in pretty much every nation on the African continent, from a $100-million hydroelectric dam in Gabon, to paving close to 220 kilometres of roads in Congo.
Behind these investments rests a well thought-out “going out” policy, outlined in China’s 10th Five Year Plan (FYP, 2001-05), and again reaffirmed in the latest 12the (FYP 2011-15), which aims to secure access to natural resources, establish new markets for Chinese exports and make Chinese firms more competitive by acquiring strategic assets. South Africa, Nigeria, and Algeria have been key destinations for Chinese investment in sectors such as energy, transportation, and metals.
Part of the “going out” policy consisted on the establishment by the government of the PRC of Special economic zones (SEZs). These zones, developed by both government owned and private firms encourage the restructuring of less competitive labour intensive sectors like building materials and textiles as in Zambia’s tobacco and electronics and Egypt’s garnments SEZs.
So far so good.
But, unfortunately, and unsurprisingly, things are never that peachy and allegedly, African people do not seem to be ripping the benefits of such investment. Since China started its commercial expansion in Africa, there have been many reports on Chinese investors’ questionable work ethics and commercial approach.
Take brothers Mactar and Moussa Gueye, whose handcrafted shoe business dates back to their grandfather, cobbler for the kings of the local Cayor kingdom. They were approached by a Chinese merchant at a trade fair in Dakar (Senegal) who seemed taken by the colourful design and quality of their shoes. In no time, cries 46-year-old Mactar Gueye, “the market was flooded with my design – only made in plastic by the Chinese”, and sold for five times less than the Senegalese originals. Chinese replicas of slippers, African vibrant wax prints, traditional ceremonial clothes, have been sold since everywhere.
As Rukmini Kachimalli reports in the Business Inquirer, just in northern Nigeria alone, a quarter-of-a-million jobs have been lost in the textile industry to these cheaper products. Many artisans are now hesitant to pass a dying craft onto their sons.
In Angola, for instance, Chinese companies have invested in building roads, railways, bridges, schools, hospitals and they have even laid a a fiber-optic network and training Angolan telecommunications workers. Somehow, however, the every day Angolan citizen does not seem to be benefiting from this flow of cash, and the country remains one of the poorest countries in the world with half of its population living under the poverty line. China is often accused of not caring how the money invested in this highly corrupted country is used and of preventing the international community’s monitored aid from reaching the people of Angola as the government is now in the position to turn these monies down thanks to Chinese investment.
Then, there’s the controversial maltreatment of workers.
In 2005, an accident in an explosives factory at the Chinese-owned Chambishi mine caused the deaths of dozens of Zambian workers. The incident focused Zambian minds on poor working conditions in Chinese-owned businesses and made Sino-Zambian relations a major issue in the following year’s presidential election.
In October 2010, another incident attracted international attention, when Chinese supervisors at the privately-owned Collum coalmine in southern Zambia fired indiscriminately with shotguns at workers who had gathered in large numbers outside the gate demanding higher pay and better conditions. The shooters were taken to court but the case was dropped after the 13 victims received compensation.
But let’s flip the coin – the Chinese voice
Are Chinese the colonising evil they are portrayed to be? To be fair, we need to give their discourse a voice. Let’s start with Helen Hai, a proud Chinese shoe manufacturer in Ethiopia.
From the video below, while proudly showing us her factory in Ethiopia, Helen Hai, vice president of the Huajian group, talks about the working style her company is trying to impose on Ethiopians, one based on discipine and team work. We see workers marching and being indoctrinated in mandarin in a way that would most certainly trigger thoughts of invasion and colonialism.
In a speech on relations with Africa earlier this month, Chinese vice-foreign Minister Zhai Jun hit back at critics of China’s growing influence in Africa and denied that China is practicing a new form of colonialism, saying China’s economic backing is giving African countries options they never had under a Western-led world order.
Africa represents one of the few potential markets for opportunities left in the world. Many Chinese families are struggling to fend for themselves in an increasingly competitive domestic markets and are keen to build businesses and a base on which to raise their children. Labour is cheap, markets could be dominated, and, for some, rules could be circumvented, so, in a way, they want to take the last bite of a pie that has been devoured by everyone else. In order to hide their starvation and urge to have that bite,
China’s official development discourse uses a language of ‘no strings attached’, quality and mutual benefit, playing their investments and diplomacy in Africa within the context of the old non-aligned movement and “Bandung spirit“, an era when many Africans viewed China as a brotherly oppressed nation, and thus supported efforts by the People’s Republic to gain a permanent seat on the United Nations security council, to replace Taiwan. And, of course, China offered firm backing for Africa’s anticolonial struggles and efforts to end apartheid.
Rocha (2007) suggests that Chinese investments in Africa are having and could continue to have some positive impacts. China is helping African countries to rebuild their infrastructure and providing other types of assistance to agriculture, water, health, education and other sectors. This could have very positive spin-offs in lowering transaction costs and assisting African governments to address social calamities such as poor health services, energy crisis, skills development.
Connotations – The lesser of two evils
In comparison to Europe and the US, China in Africa is still a small player and while being aware of the colonising potential of the Chinese, African leaders should not be distracted from the West’s continued exploitation of the continent including the use of military might to protect its economic interests. Western acccusations of China colonising Africa and damaging African indigenous manufacturing base are rooted in Western countries’ fear of the increasingly expansive Chinese economic machine which threatens their own monopoly on the continent’s development.
As Emma Mawdsely explains, comments as those we were referring to at the start of this article by Western leaders and reports in the media give everyone the impression that the African continent, and much of the rest of the world, is in the process of being ‘devoured’ by China. Phrases such as the ‘new scramble for Africa’, ‘voracious’, ‘ravenous’ or ‘insatiable’ ‘appetite for natural resources’ are typical descriptors used to characterise China’s engagement with Africa. In contrast, the operations of western capital for the same activities are described with anodyne phrases such as ‘development’, ‘investment’, ‘employment generation.
The evidence available suggests that the drive to increasing the rate of profit is exhibited as much by Chinese as by western capital. The west has the advantage of having already established its dominant position that is potentially being threatened by the ‘new boy on the block’. But China has the advantage of never having enslaved or colonised the continent. China has also not made any false promises coated with neo-liberalism. While the West, the IMF and the World Bank put conditions that only aid in their fleecing of Africa, China has so far been willing to provide unconditional aid and invest in infrastructure. At the same time, however, it freely takes full advantage of the opening up of markets that neo-liberal economic policies over the last 25 years have offered, unencumbered.
And so far, unlike the US, China has not sought to establish military bases in Africa to protect its economic interests, which the US has sought to establish through AFRICOM.
So, Mrs Clinton, you are not in a position to give anyone lessons and warn about colonising evils. It is very ironic and somewhat amusing to hear you warn African leaders about China when Asian investments in Africa are dwarfed by the more traditional imperial powers.
- Can China extend its colonisation to Africa? (chinadailymail.com)
- Loans to poor countries – China has strings attached (chinadailymail.com)
- MAP: Here Are All Of The Big Chinese Investments In Africa Since 2010 (businessinsider.com)
Categories: Trade & Investment