6
Exploring the role of China in Sub-Saharan Africa is a topic of
increasing interest given China’s ascendance and the fact that
six of the world’s top ten fastest growing economies are now
found in Africa. These circumstances—plus an immense cache
of natural resources in Africa and a rapid increase in the cost
of labor in China—have led to heightened interest in Africa’s
potential to become the world’s next major economic growth
center.
Haroon Bhorat
, Director of the Development Policy Research
Unit (DPRU) at the University of Cape Town, moderated
the discussion with a panel of experts including
Mwangi
Kimenyi
, Senior Fellow in the Africa Growth Initiative at
the Brookings Institution,
Stephen Golub
, Professor of
Economics at Swarthmore College and Adjunct Professor at
the Wharton School at the University of Pennsylvania, and
Barry Sautman
, Professor of Social Science at HKUST and
HKUST IEMS Faculty Associate.
Prof. Sautman noted that, while China and Africa have been
trade partners for over 600 years, trade between the two
regions only began to take off since the 1990s. The level
of investment is difficult to estimate because no one really
knows how much of the money China moves through foreign
banks actually ends up in Africa, but it is widely agreed that
China’s financial investment in Africa is only a small fraction of
what China invests in the rest of the world.
Prof. Golub simplified the discussion by stating that, like
any rational investor, Chinese investors are searching for
profits, the most lucrative of which are likely to be found
in manufacturing industries. There is no shortage of
entrepreneurs in Africa and China, he stated, and the Chinese
are expert exporters. Additionally, Africans have a great need
for manufactured goods. These goods are largely smuggled
as uncovered in Prof. Golub’s extensive research on Chinese
trade with the African countries of Nigeria and Benin.
While Prof. Sautman also pointed out that Chinese
investment in infrastructure in Africa is quite substantial,
there is relatively little investment in manufacturing. Oil and
minerals, so-called primary products, offer a huge potential
for international entrepreneurs, and Africans are beginning
to be cautious about how their resources are distributed
worldwide. Concurring with Prof. Golub’s earlier assessment,
Prof. Sautman further stated that, while China grew through
manufacturing and growth, manufacturing is becoming less
competitive in China, Africa may indeed provide China with
opportunities in manufacturing.
The conversation became more animated when Prof. Bhorat
asked Dr. Kimenyi about the possible threat to the U.S.
economy of this type of China-Africa partnership, who noted
that high-ranking American officials are regularly critical of
China in Africa. American officials have repeatedly warned
Africans that China may take resources from Africans without
providing employment opportunities for locals, and rather
may be importing the majority of their labor force from China
(see opposite page for Prof. Sautman’s criticism of this claim).
Ultimately, however, both the U.S. and China really just want
access to Africa’s mineral resources.
Prof. Sautman advanced the conversation with discussion of
the cultural constraints that may be slowing the development
of China’s economic relationship with Africa. Chinese people
generally do not speak Portuguese or French, nor do they
practice African religions like Islam and Christianity. Although
these cultural constraints cannot be ignored, there is a new
trend among young Chinese people to move to Africa to start
families and businesses. Moreover, a relatively large number of
African-born ethnic Chinese are now coming of age. There are
also thousands of Africans living and working in China. While
Americans look to Africa as a place to begin businesses, they
do not seek to assimilate with the population to the same
extent as many Chinese do. As Prof. Sautman speculated,
this may ultimately prove to be the reason why China wins in
Africa.
Prof. Golub concluded the discussion on the topic of Africa’s
problems in infrastructure—such as regular power outages,
protectionism, and unregulated trade—which provide
challenges for Chinese investors. Ultimately the question for
African leaders is simple: will the China-Africa relationship
create jobs and opportunities for Africans in Africa? While
Prof. Golub does not seem to think so, the other speakers
were more optimistic.
CHINA IN AFRICA: China’s Impact on
African Employment – World Bank Jobs Group
Google+ Hangout
(2015.02.23)
Video recording available at
Barry Sautman
Stephen Golub
Haroon Bhorat
Mwangi Kimenyi
