Economic analysts have concluded that the economic environment in Africa today is largely similar to that of China thirty years ago. China has of course recognized this due to their heavy investments in the economies of nearly every African nation, spending as much as over three hundred million in countries such as Sudan. The African economy resembles China in the past with factors such as a large workforce, economies ripe for diversification, large amounts of untilled arable land, and heaps of natural resources ready to be used for manufacturing. China is investing largely in African infrastructure to get the economies of Africa bumping. China invests in construction projects across the continent that benefit not only Africa, but also the Chinese investors. China is also developing a tourist relationship with Africa, many flights operate between Beijing and Nairobi daily. China was at one time in a vulnerable economic position similar to Africa before it experienced heavy investment from the United States and Europe. Because of this unique experience, the Chinese government and investors know how to play the African market to not only benefit Africa, but to benefit themselves as well.
I chose this issue because I find it interesting that many African nations have the start up economy similarities that China once experienced. China has since then worked itself up to becoming one of the strongest economies in the world, nearly rivaling that of the United States. It makes me optimistic of Africa, because if China did it, there is no reason for at least some of Africa’s nations to experience similar growth and development.
Works Cited
Burger, Schalk. "Africa the China of 30 years ago, analyst argues ." engineering news. N.p., 23 Nov. 2012. Web. 3 Dec. 2012.
Although China experienced large investments, it did not experience the level of investment that Africa receives every year. Also, China is investing heavily but does take place in some shady deals with leaders of many countries. These leaders in return allow China to maintain a large foothold in those countries natural resources. Although these investments benefit China it will be along time before we see any improvements in Africa's economic status.
ReplyDeleteI like what the article had to say about joint ventures and merging local expertise with Chinese finance. In other cases, though, Chinese foreign investment seems one-sided and self-serving.
ReplyDeleteBut I believe comparisons to China are not useful in predicting Africa's economic future. China is a country run by an authoritarian regime; Africa is a continent with several different types of regimes. It remains to be seen if China's dealings with Africa are an investment into markets and business or just a way to extract resources from the continent. At any rate, lofty and broad analogies like this one seem to oversimplify and obfuscate important questions surrounding Chinese investment in Africa.
Although you raise an interesting point soundly grounded in evidence, I think that declaring Africa's status as the developing economic powerhouse of the future is still premature. The path that China takes in the coming years, especially after the fiscal cliff, will be more indicative of the road Africa may take. Only time will tell.
ReplyDeleteAlthough, China and Africa may share some general or "macro" similarities. They differ greatly on a "micro" level. China developed economically at a very gradual pace over many years. These African nations are flooded with millions of dollars of foreign investment but lack the infrastructure and social cohesion to adopt the rapid liberalization and privatization policies most of these investments require. As a result, many countries suffer from high levels of inflation and poverty.
ReplyDeleteI don't necessarily think there are enough similarities to justify Africa becoming the new China. For one thing, China is a single country, whereas Africa is composed of 57 countries, many of which include a variety of ethnic groups and cultures. China has a very long history as one nation with a distinct culture characterized by a strong sense of unity and commitment to country rather than to self--one reason communism makes some degree of sense there. Most importantly, China's government has a tight rein on the country and is able to strictly control the economy. There is no such control over the continent of Africa. However, I'd like to be optimistic about a couple of individual countries, as you said!
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