On October 20th it was reported that China's growing presence in Africa is becoming very large and seasoned analysts cannot decide whether this booming relationship is good or bad for Africa. Critics are saying that the Chinese's strategy is entirely self-promotional meaning that it is aimed at maintaining access to Africa's precious mineral resources even when that means propping up odious governments. China reports that the Asian superpower is strictly neutral and business-oriented that aims to generate economic growth not a dangerous dependency on aid. As far as Africa's economic growth, China has overall contributed in terms of trade and infrastructure. It has built roads, ports, airports, and more, filling a critical gap that western donors have been shy to provide and unblocking many roads to growth. The rehabilitated 840-mile Benguela rail line for example now connects Angola's coast with the Democratic Republic of Congo and Zambia; while Chinese-financed roads have reduced journey times from Ethiopia's hinterland to the port of Dijibouti facilitating livestock exports. The article then explores in more detail how China contributes to the Africa's economy. In contrast the argument is then made that oil and mining are not labor intensive industries; so even if natural resources are creating impressive headline growth figures, it does not necessarily translate into the spread of job creation. Also without watchful management, oil and mineral revenues have often fueled corruption which has severe negative impacts on a countries development. For example many African's complain that Chinese projects do not employ enough Africans or do enough to transfer skills and technology. The Article then expands on how Africa could use improvement on their policies with Chinese investors and Chinese relations in general.
I chose this article because I thought it was interesting that international investment into Africa has not been decided if it is good or bad at this point. Even though everything looks good on paper there is lingering negative impacts that could potentially hurt the nation. I also chose this article because it ties in with the concept of dependency theory and its history of negative impacts on many of the states in Africa like Nigeria. I think it’s hard to say what is going to happen because even the article is on the fence about the issue. I think it’s great that Chinese Investors are investing in the country with big projects like mining that help add to Africa's economy providing better roads and transportation of goods. But on the other hand it was also explained that many of these projects are not labor intensive and creates little work for Africa's citizens. This would not help poverty rates but it would show better economic statistics for the country as a whole. Since technology and skills are not being passed along, this leads to more dependency of Africa relying on countries like China to take advantage of natural resources to keep the country on its feet. Overall if the presence of China is controlled appropriately it has the potential of expanding enormous opportunity.
In order for this to work properly, I think African countries need to encourage Chinese Investment into more labor intensive sectors. Since Africa's populations are growing at a very fast rate, job creation is very important if it wants to take advantage of the opportunity of foreign investment. African countries also would need better terms with Chinese Investors that include quality control and better linkages with local economies. African governments could urge China to improve market access for African goods overseas, for example the World Trade Organization.
Sources:
"Is China Good or Bad for Africa?" รข€“ Global Public Square. N.p., n.d. Web. 31 Oct. 2012. <http://globalpublicsquare.blogs.cnn.com/2012/10/29/is-china-good-or-bad-for-africa/?iref=allsearch>.
It is so fascinating how China, once destitute and strictly communist, is now becoming a capitalist superpower of the world. China is smart to invest in Africa for its natural resources, but at the same time, while doing this investing, should be providing more jobs to the Africans if China is going to be taking a great deal of their resources. China actually has the potential to provide a great deal of economic stimulus to some of the more agriculturally and resource rich countries!
ReplyDeleteLike you, and the comment above, i do believe that it is great that China is investing in Africa and i have read a few articles on it. I've also read that their investment in Africa has surpassed that of the U.S. and it can be very beneficial for both China and Africa. Basically the way China is doing business in Africa is that they build a lot of infrastructure in the region and in return they government will allow Chinese companies to work and do what they do. My reaction to the title though is a bit of resentment to be honest because i believe that China is doing a better job for Africa then any of the other countries, though they are trying to benefit themselves. It is definitely better than the other way countries are trying to get at Africa's resources which is forcing them to lower their trade barriers and basically having their own companies (such as american ones) go in and obliterate local companies and using foreign workers.
ReplyDeleteThe other point i would like to address is increasing job creation. Though i believe lots of the lower labor oriented jobs are being used for building of infrastructure, it will be difficult for China or any other country to hire locals for the jobs that are further up the ladder due to brain drain and the fact that there aren't any people around that are qualified for those jobs. But yes you are right the local governments must have an obligation to push for job creation, though that would be difficult if corruption is prevalent in the country and they are simply enjoying foreign money.
Matt-
ReplyDeleteIt will be interesting to see what you think after we discuss the growing role of China in Africa in the coming weeks. I also wonder if something like economic investment can ever be construed as being "bad" or "good" for the entirety of a continent.
From research I've conducted on the topic, although China was initially focused on natural resources in Africa, there has also recently been an increased interest in banking in the region. This may just be one example of a market that could provide more jobs and sustainable business but overall I think that China's interest in Africa has been a large improvement on the West's, which is based strictly on aid and exploitation. Many of the worlds untapped resources are in Africa and China is smart to establish a business ethos in the area that could eventually accommodate a growing workforce.
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