Mzansi Afrika

From Johannesburg South Africa, a window on the world

Thursday, February 24, 2005

More on China in Africa

It seems as if I was on the mark when I speculated earlier about China wanting to be rewarded for investing and aiding African countries. I've seen an article in Tuesday's Business Day that deals with this precise issue. Writing under the headline "Chinese the new economic imperialists in Africa" Dianna Games puts forward the notion that African countries should stop worrying about economic colonisation by the likes of the US and the British, but should rather be looking with more concern at China bearing "gifts". She cites some interesting examples:

"In Kenya last month, China's largest listed telecoms manufacturer, ZTE Communications, made a "gift" of equipment worth 144-million Kenyan shillings to Telkom Kenya. ZTE said the company would "continue to play a positive role in Kenya's telecommunications industry". After a gesture like that, it's certain to get a role.

Zimbabwe is all but owned by China, say many Africa watchers. When President Robert Mugabe saw his biggest critics were also his biggest trading partners and tourism markets, he defensively turned to the east, lauding countries such as China as the true partners of Zimbabwe. In return for a rare hand of friendship in an increasingly hostile world, Mugabe has offered Chinese companies almost anything they want, regardless of the payback. And payback there will be. Chinese telecoms supplier Huawei Investments last year demanded it be guaranteed a portion of Zimbabwe's profits from minerals and tobacco - in addition to a hard cash payment - before it would supply $160m worth of telecommunications equipment for the second fixed-line telephone network."

Games goes on to say that not only does China undermine local economies by flooding their markets with cheap goods, but many contracts stipulate that Chinese labour be used - bang goes the possibility of meaningful local job creation from the foreign investment.

"There is nothing essentially wrong with China making inroads into global markets. Everybody tries to do it. What is different here is that some African governments seem to believe it's not strictly a hard-nosed relationship, but one that is altruistically motivated. This is partly the result of China's support for Africa's independence struggles. The Chinese practice of offering "gifts" to smooth the way for later ventures often serves to bolster this perception of magnanimous comradeship."

The rest of the article is here

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