Western media is painting a grossly misleading picture of Chinese investment in Africa
Barry Sautman and Yan Hairong 12 February 2010
International media have reported up a storm on the recent surge in China-Africa links. They invoke a theme familiar from the past two centuries of colonialism and cold war: Africa is beset by poverty and ignorance, caused by ruthless and corrupt rulers. Westerners are trying to bring them to book and instil order on the continent, but other forces, in this case Chinese interlopers, are making that difficult. The facts on the ground show China’s engagement in Africa has been more positive than this discourse claims. The Chinese are getting bad press in the West because they are from a country that is not liberal, democratic or white, yet are effectively competing with those who are - to the point that some Africans see Chinese development activities as providing a model.
The Chinese, it is said, are in Africa only for natural resources, to feed China’s industry and huge population. To exploit the continent, they provide loans and aid to rogue regimes. They worsen the plight of Africans by dumping cheap, shoddy products in their markets and ruin local industry. Chinese investors pay Africans a pittance, in contrast to more ethical Western firms. China can only be an obstacle to Africa’s development.
It’s an exciting tale but, alas, the media has it all wrong. It’s not mainly China that impairs Africa’s development, but a world system of neo-liberal capitalism, based on privatisation, trade liberalisation and reduced social spending, into which China is now partly integrated. As part of the same world system, China and the West have many activities in common in Africa, but there are also some distinctly Chinese trade and investment practices, and these are often more appealing to Africans.
China-Africa trade was US$3 billion in 1995, but US$107 billion in 2008. That’s still only 4 per cent of China’s world trade. Yet, it makes China Africa’s second-largest trading partner and trade is balanced in Africa’s favour. On imports from Africa, the China-in-Africa media discourse focuses overwhelmingly on oil. It’s often alleged that Chinese demand perpetuates Africa’s reliance on petroleum exports, at the expense of growth in more labour-intensive industries, such as agribusiness and manufacturing.
Most of what China buys from Africa is indeed oil (62 per cent) and ores and metals (17 per cent) but, in 2008, oil was 88 per cent of US imports from Africa and minerals made up most of the rest. China’s investment in oil production in Africa equals only 8 per cent of that of Western multinationals and 3 per cent of all investment in African oil. China received 9 per cent of Africa’s oil exports, but Europe and the US each took 33 per cent. China also couples oil acquisition with low- or no-interest loans to build the infrastructure Africa needs. For 2006-2013, China lent or will lend US$28 billion to Africa for infrastructure and as trade credit. There is also less scope for corruption with China’s loans for infrastructure projects - often built by Chinese firms paid directly by Beijing - than with the all-purpose aid Western sources provide African governments.
The focus of the China-in-Africa discourse on China’s exports is almost wholly on basic consumer items and their alleged negative consequences. Chinese goods are held responsible for the decline in Africa’s textile and clothing industry. But when Chinese goods first came en masse, in about 2000, Africa’s textile and clothing industry was already decimated by the international financial institutions’ forced trade liberalisation of the 1980s and 1990s, which opened the market to second-hand and new clothing from developed countries. The fact is that Chinese goods are much cheaper than imports from other countries, as well as locally produced goods that are made costly by poor infrastructure, pricey utilities and corruption. A British government study found that Chinese exports to Africa mainly displace developed country exports.
China’s stock of investments in Africa rose from US$49 million in 1990 to US$7.8 billion in 2008. Total foreign direct investment in Africa in 2007 was US$36 billion, with most of it from the European Union, US and South Africa. There are about 1,000 significant Chinese enterprises in Africa, but the media reports focus only on investment in extractive industries, particularly on one investment, the Chambishi copper mine in Zambia.
Conditions at the Chambishi mine, with its 2,200 employees, have indeed been deplorable. But, Chambishi is not the only mine where conditions are highly oppressive, as the many strikes at Western and white South African mines show. Both Chinese and Western firms in Africa have oppressive conditions, but Western firms are more profitable. In contrast to Western investments, many Chinese enterprises share profits with Africans.
China is presented as “indifferent to Africa’s authoritarian despots, as it courts the continent for energy and minerals”, as a leading British journalist put it. But the US and France support most despots in Africa, providing them with military assistance and legitimacy. The West is also implicated in the trade in money and trade in people. Some 40 per cent of Africa’s private wealth has been sent overseas. London and Zurich, not Beijing, receive these fruits of capital flight and tax evasion.
The China-in-Africa discourse lacks a comparative approach and reflects Western elites’ perception of their national interests and moral superiority. It fails to question Western government rhetoric about “aiding African development” and “promoting African democracy”. At the same time, they seize on any example of supposed exploitation by Chinese in Africa.
Many Africans - and some Westerners - question the binary view of a new Western “civilising mission” versus the actions of “amoral” Chinese. They are increasingly rejecting a discourse that draws attention away from Africa’s systemic problems of exploitation and human rights and towards blaming Chinese, not for what they actually do in Africa, but for being the newly perceived strategic competitor of the West.
Barry Sautman is a political scientist and lawyer at the Hong Kong University of Science & Technology. Yan Hairong is an anthropologist at the Hong Kong Polytechnic University. Reprinted with permission from YaleGlobal Online. http://yaleglobal.yale.edu
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Smear campaign
Western media is painting a grossly misleading picture of Chinese investment in Africa
Barry Sautman and Yan Hairong
12 February 2010
International media have reported up a storm on the recent surge in China-Africa links. They invoke a theme familiar from the past two centuries of colonialism and cold war: Africa is beset by poverty and ignorance, caused by ruthless and corrupt rulers. Westerners are trying to bring them to book and instil order on the continent, but other forces, in this case Chinese interlopers, are making that difficult. The facts on the ground show China’s engagement in Africa has been more positive than this discourse claims. The Chinese are getting bad press in the West because they are from a country that is not liberal, democratic or white, yet are effectively competing with those who are - to the point that some Africans see Chinese development activities as providing a model.
The Chinese, it is said, are in Africa only for natural resources, to feed China’s industry and huge population. To exploit the continent, they provide loans and aid to rogue regimes. They worsen the plight of Africans by dumping cheap, shoddy products in their markets and ruin local industry. Chinese investors pay Africans a pittance, in contrast to more ethical Western firms. China can only be an obstacle to Africa’s development.
It’s an exciting tale but, alas, the media has it all wrong. It’s not mainly China that impairs Africa’s development, but a world system of neo-liberal capitalism, based on privatisation, trade liberalisation and reduced social spending, into which China is now partly integrated. As part of the same world system, China and the West have many activities in common in Africa, but there are also some distinctly Chinese trade and investment practices, and these are often more appealing to Africans.
China-Africa trade was US$3 billion in 1995, but US$107 billion in 2008. That’s still only 4 per cent of China’s world trade. Yet, it makes China Africa’s second-largest trading partner and trade is balanced in Africa’s favour. On imports from Africa, the China-in-Africa media discourse focuses overwhelmingly on oil. It’s often alleged that Chinese demand perpetuates Africa’s reliance on petroleum exports, at the expense of growth in more labour-intensive industries, such as agribusiness and manufacturing.
Most of what China buys from Africa is indeed oil (62 per cent) and ores and metals (17 per cent) but, in 2008, oil was 88 per cent of US imports from Africa and minerals made up most of the rest. China’s investment in oil production in Africa equals only 8 per cent of that of Western multinationals and 3 per cent of all investment in African oil. China received 9 per cent of Africa’s oil exports, but Europe and the US each took 33 per cent. China also couples oil acquisition with low- or no-interest loans to build the infrastructure Africa needs. For 2006-2013, China lent or will lend US$28 billion to Africa for infrastructure and as trade credit. There is also less scope for corruption with China’s loans for infrastructure projects - often built by Chinese firms paid directly by Beijing - than with the all-purpose aid Western sources provide African governments.
The focus of the China-in-Africa discourse on China’s exports is almost wholly on basic consumer items and their alleged negative consequences. Chinese goods are held responsible for the decline in Africa’s textile and clothing industry. But when Chinese goods first came en masse, in about 2000, Africa’s textile and clothing industry was already decimated by the international financial institutions’ forced trade liberalisation of the 1980s and 1990s, which opened the market to second-hand and new clothing from developed countries. The fact is that Chinese goods are much cheaper than imports from other countries, as well as locally produced goods that are made costly by poor infrastructure, pricey utilities and corruption. A British government study found that Chinese exports to Africa mainly displace developed country exports.
China’s stock of investments in Africa rose from US$49 million in 1990 to US$7.8 billion in 2008. Total foreign direct investment in Africa in 2007 was US$36 billion, with most of it from the European Union, US and South Africa. There are about 1,000 significant Chinese enterprises in Africa, but the media reports focus only on investment in extractive industries, particularly on one investment, the Chambishi copper mine in Zambia.
Conditions at the Chambishi mine, with its 2,200 employees, have indeed been deplorable. But, Chambishi is not the only mine where conditions are highly oppressive, as the many strikes at Western and white South African mines show. Both Chinese and Western firms in Africa have oppressive conditions, but Western firms are more profitable. In contrast to Western investments, many Chinese enterprises share profits with Africans.
China is presented as “indifferent to Africa’s authoritarian despots, as it courts the continent for energy and minerals”, as a leading British journalist put it. But the US and France support most despots in Africa, providing them with military assistance and legitimacy. The West is also implicated in the trade in money and trade in people. Some 40 per cent of Africa’s private wealth has been sent overseas. London and Zurich, not Beijing, receive these fruits of capital flight and tax evasion.
The China-in-Africa discourse lacks a comparative approach and reflects Western elites’ perception of their national interests and moral superiority. It fails to question Western government rhetoric about “aiding African development” and “promoting African democracy”. At the same time, they seize on any example of supposed exploitation by Chinese in Africa.
Many Africans - and some Westerners - question the binary view of a new Western “civilising mission” versus the actions of “amoral” Chinese. They are increasingly rejecting a discourse that draws attention away from Africa’s systemic problems of exploitation and human rights and towards blaming Chinese, not for what they actually do in Africa, but for being the newly perceived strategic competitor of the West.
Barry Sautman is a political scientist and lawyer at the Hong Kong University of Science & Technology. Yan Hairong is an anthropologist at the Hong Kong Polytechnic University. Reprinted with permission from YaleGlobal Online. http://yaleglobal.yale.edu
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