China and Africa

A preface excerpted from The Atlantic:

“Statistics are hard to come by, but China is probably the biggest single investor in Africa,” said Martyn Davies, the director of the China Africa Network at the University of Pretoria. “They are the biggest builders of infrastructure. They are the biggest lenders to Africa, and China-Africa trade has just pushed past $100 billion annually.”

Davies calls the Chinese boom “a phenomenal success story for Africa,” and sees it continuing indefinitely. “Africa is the source of at least one-third of the world’s commodities”—commodities China will need, as its manufacturing economy continues to grow—“and once you’ve understood that, you understand China’s determination to build roads, ports, and railroads all over Africa.”

Davies is not alone in his enthusiasm. “No country has made as big an impact on the political, economic and social fabric of Africa as China has since the turn of the millennium,” writes Dambisa Moyo, a London-based economist, in her influential book, Dead Aid: Why Aid Is Not Working and How There Is a Better Way for Africa. Moyo, a 40-year-old Zambian who has worked as an investment banker for Goldman Sachs and as a consultant for the World Bank, believes that foreign aid is a curse that has crippled and corrupted Africa—and that China offers a way out of the mess the West has made.

Some additional links:

1. Via Chris Blattman
2. Foreign Affairs:

Why would the Chinese government push some of its labor- and energy-intensive industries to move to special economic zones in Africa, even as the U.S. Congress bans the U.S. Agency for International Development from financing any activities that could relocate the jobs of Americans overseas? Because Chinese planners want industrialists at home to move up the value chain. Polluting industries such as leather tanneries and metal smelters are no longer tolerated in many Chinese cities.

3. The Atlantic (interesting throughout):

Many Chinese agricultural initiatives are shrouded in mystery. In 2006, for instance, China offered a $2 billion soft loan to Mozambique for a project to dam the Zambezi River Valley, amid some of the continent’s most fertile soils. The following year, Chinese and Mozambican officials reportedly signed a memorandum of understanding allowing 3,000 Chinese settlers to begin farming in the area. But following a local uproar, Mozambique’s government denied all reports of the plan, and little has been heard of it since. ...

... The stop-and-go quality of major Chinese farming deals and the strong feelings that they’ve produced suggest that the honeymoon between the Chinese and Africans may not last long. During the course of my trip, land issues seemed to bring out the ugliest biases in the people I spoke to. “If you gave this land to Chinese people to work it, this place would be rich overnight,” said one Chinese woman immigrant, a middle-aged trader in southern Congo: “They’re too lazy, these Africans.” Many Africans, for their part, were intensely wary of Chinese immigration; Daniel told me that this was a particularly raw issue among many of his friends. Conspiracy theories echoed frequently. In Dar, for instance, rumors had spread that the new national sports stadium was part of a secret deal to grant land to Chinese farmers in Tanzania.

... Many Chinese fortune seekers had hired African work gangs to dig for copper, sometimes even in Lubumbashi’s red-clay streets. “They were profiteers and speculators,” said one local businessman. “Congo got nothing from them.” Most of them dug “no more than 20 feet deep, which requires no investment at all.” The government belatedly tried to reassert control, requiring all those who mined copper to smelt it as well, and to make more-substantial investments in equipment, in order to generate more jobs and tax revenue and to make the industry more sustainable. In response, small operators scrambled to build small, inefficient furnaces. In 2008, as prices tumbled from $9,000 a ton to a low of $3,500, the makeshift smelters closed down and the Chinese owners fled, leaving their Congolese workers unpaid and the landscape littered with industrial refuse.