The West is worried about Chinese investment in Africa. US secretary of state Hillary Clinton regularly makes veiled references to the danger of Africa’s “new colonialists”. Last summer, UK prime minister David Cameron warned Africans about the risks of partnering with authoritarian China.
Why? Everyone knows that the Chinese are aggressive newcomers to Africa, only interested in resources, including land to feed China’s growing population; bringing in all their own workers in countries desperate for employment. Yet much of what “everyone knows” about Chinese investment in Africa is simply wrong.
In July, as rain beat on the roofs of the Chinese-run Eastern Industrial Zone outside Ethiopia’s capital, Addis Ababa, I walked along the production lines where more than 800 Ethiopian workers are producing shoes for major American labels. Attracted by Ethiopia’s high quality leather, Huajian, one of China’s largest shoe factories, is part of China’s own nascent globalisation. 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 in Africa. Several kilometers 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 in Ethiopia.
Ethiopia represents much of the reality of Chinese investment below the headlines. Are the Chinese leading a land grab in Africa? Researchers from the California-based Oakland Institute who did months of fieldwork in Ethiopia were surprised to find no large-scale Chinese agricultural investors. Experts from the Center for International Forestry Research travelled to the Congo to 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 discovered that from Mozambique to Zimbabwe, stories about alleged Chinese land grabs turn up very few actual projects, aside from several dozen Chinese-owned farms producing for local markets in Zambia and a handful of long established sugar and sisal plantations, purchased in the 1990s during Africa’s era of privatisation. “We’re getting lots of investment from India,” the head of Ethiopia’s commercial farming promotion office told me, “but not from China.”
Do Chinese companies bring in all their own workers? In a small number of countries where local labour is expensive, such as Algeria, Libya, even Angola and Sudan, Chinese construction companies with infrastructure contracts have brought in large Chinese crews. Yet in Ethiopia and most other parts of Africa, Chinese managers direct teams of local employees. Huajian 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 with a foreign firm.
Chinese companies, like Western firms, are certainly interested in African resources, and sometimes, like Western firms, in countries ruled by unsavoury regimes that don’t respect human rights or elections. Yet although a Hong Kong firm, PetroTrans, won an oil exploration concession, Beijing hasn’t bothered to look for oil in Ethiopia. China’s largest economic partners on the continent include stable, democratic South Africa, Mauritius, and Ghana, where 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” of China’s invasion, the West should take a more constructive and informed interest in what the Chinese are really doing to take advantage of Africa’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 Bräutigam is Professor and Director of the International Development Program at Johns Hopkins University/SAIS.
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