/ 29 August 2014

China’s designs on Africa in dispute

Kenyan President Uhuru Kenyatta and ­Chinese President Xi Jinping struck a multibillion-dollar deal to ­upgrade Kenya’s railways.
Kenyan President Uhuru Kenyatta and ­Chinese President Xi Jinping struck a multibillion-dollar deal to ­upgrade Kenya’s railways.

Separating myth from fact is a far from easy task when examining China’s dealings with African countries.

Earlier this month, Kenyan officials let it be known that 5?000 Chinese workers would travel almost 10?000kms to Africa to build the first phase of a railway on which President Uhuru Kenyatta had staked a huge chunk of his legacy.

The 609km of track, valued at $3.7-billion, will be the first additions Kenya has made to its ageing British-built railway network since the 19th century and, when complete, will connect to the hinterlands of South Sudan, Rwanda and Uganda.

But Kenyan public reaction to the news online neared an uproar and the Consumer Federation of Kenya is currently running a poll, which is showing that nearly 80% of Kenyans oppose the influx of such a large number of Chinese workers, even if 30?000 locals will also be employed.

The debate has dredged up myth and fact and, to help to cut through the fog, Mail & Guardian Africa looked at five of the most common perceptions of Sino-African relations, and what some experts on Sino-African relations have to say about them.

1. China is in direct competition for Africa with the West

The widely covered United States-Africa Leaders Summit earlier this month led to talk of the US awakening to the “threat” of China’s advance into Africa, and how Washington will have to play catch-up, with the $33-billion headline investment figure announced by President Barack Obama being compared with the figures linked to Beijing in recent years. 

This perception is a “gross oversimplification”, says Howard French, the author of China’s Second Continent, an eye-opening book that details how a million Chinese migrants are building a new empire in Africa.

The idea that China’s big recent successes – which have led to the “Look East” policy that is a favourite of African leaders – have come at the expense of the West are largely untrue, French says in an interview with Chinaherald.net, citing the way in which the global economy is segmented and increasingly specialised.

“The goods that China is selling are generally not mainstays of Western commerce any more,” says French.

“I would also say that China has large, inherent competitive advantages in infrastructure and public works, because of the scale of infrastructure building in China, and because of the low cost of capital there, and that much of the business it is winning in Africa in this sector isn’t so much being taken away from anyone as it is being allocated rationally.”

2. Every move China makes in Africa is directly planned by the highest echelons of the Chinese state

Not so, many Africans would be surprised – and some mollified – to learn. The respected China-Africa expert Yun Sun, in her Africa in China’s Foreign Policy research paper, notes that, despite appearances, the continent is generally a low priority for Beijing, which is far more preoccupied with issues to do with the US or its immediate Asian neighbours.

“In practice, policymaking specific to Africa happens mostly at the working level, and is divided among several government agencies, with the ministry of foreign affairs and the ministry of commerce taking the lead,” she says.

Africa is thus classified under “developing nations” and only the most important or politically important of its issues – such as the 2008 Darfur crisis that brought it unwelcome international attention – make it to politburo level. 

Surprisingly, China’s own policy community loudly criticises the fact that Beijing does not have an Africa strategy, and that commercial interests have taken precedence over national interests. Indeed, the two ministries are often seen to be fighting to take a lead role in Africa policy, with foreign aid the main battlefield.

3. Chinese interest-free loans flow in, unhindered, by the billions

The perception has been that China is happy to dole out cash on easy terms (read zero-interest loans) as it relentlessly pushes its resource-driven “chequebook” diplomacy.

But scholars note that concessional loans now make up the majority of China’s aid financing, and zero-interest loans are down to single digits – 8.1% from nearly 30% in 2011.

Interestingly, Chinese aid to Africa is on the rise as richer nations cut theirs. In 2012, China allocated Africa 51.8% of its total aid, up from 45.7% in 2009, according to its second white paper on foreign aid, released last month.

A grey area is that China, in keeping with its regular befuddling manner, categorises concessional loans as aid, but it did note helpfully that it had raised the principals on such loans but would meet any market difference.

A great deal of Chinese aid is also tied to the purchase of Chinese goods and services but, as the Ghanaian scholar Vladimir Antwi-Danso argues, this is also often the case with Western aid. 

Antwi-Danso says that China is also not on a “lone ranger” mission, and has been working with multilateral organisations in Africa. The Financial Times reported on an “unprecedented proposal” by Beijing to the US to link up on infrastructural projects in Africa.

It is true that overall trade (more than $210-billion last year) and foreign direct investment into Africa have increased exponentially. But many have been quick to note that Beijing does not cancel concessional loans when giving debt relief to stressed African debtors. 

4. China’s only interest is economic, and it created the oil-backed loan

It is also true that Africa’s resources are a natural anchor to the seminal “Going Out” strategy announced by then-president Jiang Zemin in 1996 following a six-nation African tour, in which the Chinese were encouraged to “utilise both domestic and international markets and resources”.

Africa’s markets play to China’s competitive advantage in manufacturing, and came in handy during the 2008 financial crisis that saw Western demand for Chinese goods shrink. This is seen as a major reason why China overtook the US as Africa’s main trading partner in 2009. 

China is also seeking to tap Africa’s vast labour resources by exporting low-skilled jobs and labour-intensive industries to the continent to help its own climb up the global supply system. 

But Yun says in her paper that, contrary to perceptions, China’s interests involve four pillars – political, economic, security and ideological – and not just one.

Beijing actively seeks African diplomatic recognition for its “communist” model versus the Western one (and in its battle with Taiwan), and also the continent’s support in key forums such as the United Nations.

China has been particularly keen to point out that its brand of authoritarianism and economic capitalism has produced the growth that is so admired by Africans.

Yun also notes that commodity-backed loans were not a brainchild of China: the West used them in deals with Ghana and Angola, before China inked its first oil-backed loan deal with Luanda in 2004.

5. After Africa’s resources, a grab for Africa’s vast land

The next huge farmland grab is on its way, as China, not content with gobbling up Africa’s resources, seeks to feed its billion-plus population with food grown on the continent. Or so the story goes.

Tales about the grabbing of African farmland continue to evoke a lot of emotion, with several countries such as Ethiopia, Madagascar, Ghana and Zimbabwe said to have struck deals with governments and foreign agribusinesses for export-oriented food ventures that, in the process, displace many indigenous people.

As would be expected, China is in the thick of it, having had a presence in African agriculture for decades. The most recent “scare” was sparked by a US Aid-linked report that highlighted the end of China’s self-sufficiency food policy.

But Professor Deborah Bräutigam, a leading author and expert on Sino-African relations, says that China is currently not exploring the possibility of feeding its population with African food, and refers to the work of the economic journalist Adama Wade, who argues that it would be uneconomical for China to do so.

In fact, the converse is true – Chinese companies develop food crops for African markets.

Bräutigam, in her China in Africa: The Real Story blog, also offers pointers to other misconceptions, including that China’s no-bid deals with African governments bring down costs, and that Chinese investors in the Zambian copper mines, famously perceived as modern-day slave drivers, perform as well as the industry average.

Just how high – or low – that average is should actually be the question.

This article was originally published on mgafrica.com