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China's big win in Africa: How enlightened self interest served the greatest number

Unintended consequences are often blamed for negative outcomes, yet China's towering success in Africa may well be the result of one such occurrence 600 years ago.

That's when China's Admiral Zheng He's fleet returned from spanning the South Seas and Indian Ocean with dreams to colonise India and Africa.

But newly installed Emperor Hongxi, resentful the ambitions of his predecessor, would have none of it. He scrapped Admiral Zheng's charts and ordered him ashore.

What many said was an error, can now be viewed a blessing in disguise. That's because by not creating a colonising trans-marine empire, China finds itself today as an unblemished major power able to win friends in Africa they never sought to conquer.

Granted China's role in Africa has its critics, but they are few in number. One Hong Kong visitor, who bought a dress in Pietermaritzburg for his wife, a bright African print, was crowing about the authenticity of his find until he spotted the "Made in China" label.

More seriously, some criticise the import of cheap manufacturers as injurious to local producers while others complain of China's undue influence in politics where it freely leverages its lack of colonial baggage to get what it wants.

But let the numbers do the talking. Trade between China and Africa increased 700 per cent during the 1990s, and China is now Africa's biggest trading partner. Helping to keep that ball on the hop is the Forum on China-Africa Cooperation (FOCAC), established in 2000 and growing ever-more influential since.

CNN reports opinion polls which show the Chinese are popular in Africa, investing in everything from small food enterprises to massive railway projects.

According to a recent report by Afrobarometer, 63 per cent of Africans surveyed say China's influence is somewhat positive or very positive, while only 15 per cent see it as somewhat or very negative.

"There is a negative narrative of China in Africa," said Anyway Chingwete, co-author of the study and project manager at Afrobarometer and the Institute for Justice and Reconciliation in Cape Town. "But ordinary citizens have a positive sentiment because of the contribution China makes."

Attitudes vary from country to country, with people in Mali (92 per cent), Niger (84 per cent), and Liberia (81 per cent) being particularly glad to have them around.

"This shows that African citizens are welcoming China's involvement," said Ms Chingwete.

Reasons are obvious. China invests more in Africa than any other country, with Ethiopia, Kenya, Tanzania and Angola among the biggest recipients of Chinese funds.

Infrastructure development, for example highways and railways, are the main areas of business for the Chinese in Africa. They also invest in smaller enterprises and food outlets, as reported by CNN.

Africans also like the Chinese for bringing in cheap cars and mobile phones, says Mogopodi Lekorwe, a professor of Politics at the University of Botswana.

"They used to be very expensive, but because these are now flooding the market, the prices have dropped. People can now pick and choose among things that they didn't have access to in the past," he said.

During the "Winds of Change" movement of the 1960s and '70s, China was aligned with the native liberation in Anti-Aparthied Movement, which were once the rebel forces. Such was the case of the African National Congress (ANC) of South Africa, which has since become the ruling party of the state.

In 1980, the total Sino-African trade volume was US$1 billion. In 1999, it was $6.5 billion and in 2000, $10 billion. By 2005, the total Sino-African trade had reached $39.7 billion before it jumped to $55 billion in 2006, making China the second largest trading partner of Africa after the United States, which had trade worth $91 billion with Africa.

China has now surpassed Africa's traditional economic partner, which had trade worth $47 billion. In 2010, trade between Africa and China was worth $114 billion and in 2011, $166.3 billion. In the first 10 months of 2012 it was $163.9 billion.

There are some 800 Chinese corporations doing business in Africa today, most of them private companies in infrastructure, energy and banking.

Through these, China offers unconditional and low-rate credit at 1.5 per cent over 15 years to 20 years have taken the place of the more restricted and conditional western loans. Since 2000, more than $10 billion in debt owed by Africa to China has been cancelled.

As big and an important as China is, it is still relatively poor in natural resources. China's population is aging, but educated, and under control given the one-child policy. The situation in Africa is substantially reversed. Half the population is below 20, and uneducated, which means the working-age population will surge over the next 20 years, and continue growing.

That means Africa needs to create 20 million jobs a year. Twenty years from now, it will need 30 million new jobs a year. Its smaller, younger and largely uneducated population relative to its riches in natural resources give the two land masses a complementarity rare in the world.

On the plus side, Africa and China have been natural trading partners for 20 years. China possesses a small share of natural resources such as arable land, renewable water, petroleum, and metals. Thus, China is resource-poor relatively speaking.

By contrast, the African continent is resource-rich compared to its population. In particular, it boasts of ample energy and mineral reserves. This difference in endowments creates the potential for mutually beneficial trade.

Chiefly, an increasingly affluent China seeks oil today. One-third of China's oil comes from Angola, but also Algeria and increasingly Nigeria.

In exchange for access to Africa's oil China's effort to support factories manufacturing goods for export has been considerable. Along with roads and ports, Nigerian President Muhammadu Buhari sought help in finishing the stalled rail link, a 1,400-kilometre run from Lagos, the principal city and the old national capital, along the country's entire Gulf of Guinea coast to the old slave port of Calabar, near the Cameroon border.

China has considerable experience in this area. In Africa's de-colonialism period and independence drives of the 1960s and '70s, one of the most notable projects was the 1,860-kilometre TAZARA Railway, linking Zambia and Tanzania, which China helped to finance and build from 1970 to 1975. The job involved 50,000 Chinese workers sent to the continent to complete the project. By 1978, China was giving aid to more African countries than the United States.

Growth in sub-Saharan Africa has been impressive especially in the mid-2000s when GDP growth averaged close to seven per cent a year.

After 2015, growth slowed. Both growth and the slowdown are related to China, said the former Goldman Sachs president John Thornton, now a professor at Beijing's Tsinghua University.

Writing a report on China's impact in Africa for the Washington-based Brookings Institution, Prof Thornton noted that there are big differences in rules governing western and Chinese investment in Africa, though the rules burdening western investors are largely self-imposed. These involve ethical blockages, and adherence to environmental, labour ideals and standards, or insisting on strictly legal practices.

Said Prof Thornton: "Chinese investment is indifferent to the governance environment in a particular country. China has investments in Democratic Republic of the Congo, Angola and Sudan. But because western investment tends to avoid the worst governance environments, Chinese investment is relatively high in those locations."

Also China's Ministry of Commerce sees that the big state enterprise deals play a bigger role. As a rule, Chinese firms investing in Africa are not focused on natural resource extraction, but in the service sector, with significant investment in manufacturing as well. Many African economies are interested in attracting Chinese investment in manufacturing and services and welcome this development.

Evidence suggests that Chinese firms have crowded out African construction companies. This is an area where a tradeoff seems to exist between getting things done and facilitating the development of a local construction industry.

Haley Swedlund, a professor at Centre for International Conflict Analysis and Management at Radboud University, at the Nijmegen School of Management, Radboud University at Nijmegen in the Netherlands, noted tensions existed between traditional donor countries, that is the west, and the interloping Chinese.

While she said the conflict tended to be overplayed, because giving away free money was seldom difficult for any donor government, but getting it from such sources was hard because of all the environmental and ethical hurdles they must meet to secure the cash.

To be fair bribes pose serious legal risks for western donor countries, and their contracting partners. A Swiss forwarder once faced serious fines, and was at risk of jail time, in the United States for paying a bribe in Nigeria. The extra-territoriality of legal writs today, has become a serious stumbling block.

Or as Prof Swedlund put it more delicately: "In large infrastructure projects, African governments often prefer Chinese financing because it is quicker to materialise and has less red tape. The Bui Dam project in Ghana, for example, languished as a World Bank project but moved more quickly to completion once the Chinese took over."

She also pointed out that China is in Africa to do business, and not save the planet or uplift mankind. Partly, actions are taken in the service of Beijing's greater Belt and Road initiative, which now encompasses Africa. Other donor countries don't really expect their money back or any other material return on investment. Many of them consider it immoral to think in these terms.

China has no such qualms. It does not demand internal moral reform that the west does. Only that those who contract with it uphold their side of the bargain. It appears that demanding less perfection in people gets more out of them to the mutual satisfaction of most if not all.

While unintended consequences are often the source of regret, there are times when they can be pure serendipity. And it may yet become accepted that in not responding to the natural urge to build an overseas empire, Emperor Hongxi made a decision not to take a step his country never came to regret.

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