From the Cape to Cairo, private Chinese investment thrives in Africa
 When one thinks of Chinese investment of Africa, one thinks of state-owned enterprises, which is appropriate enough given the size of the SOE role on the continent.
But increasingly there is more and more private Chinese investment in Africa where a little SME money can go a long way - certainly further than in Europe, America or Japan.
What's more, there is also a push that comes with this pull. Africa has what China increasingly lacks, affordable labour, lower environmental compliance costs and ready markets for low-end goods which are harder to make and sell in China today.
Eric Olander, co-host of the well-known China Africa Project podcast, is a veteran commentator on Sino-African relations. He notes an emerging "southern strategy" that has caught the imagination of some in China's more adventurous merchants.
"The Chinese have realised they had difficulties breaking into Europe, Japan and the US, so they went south, to Southeast Asia, Latin America, and Africa," Mr Olander told Hong Kong's China Economic Review.
"There they are able to build special products and cultivate relationships with consumers in regions that had been almost completely abandoned by the West and Japan." he said.
Big brands, he said, like Apple and Samsung, GM, were not catering to these markets. But Chinese companies such as Great Wall and Geely made their way in, building factories, selling cars, building products designed for these markets. As it happens, Western brands have started to take notice.
"Huawei, for example, built phones with little solar panels on them that make them easier to charge if you’re not around a stable supply of electricity - great ideas!" said Mr Olander.
"Remember the Chinese have pioneered so many of the new business models that the West and Japan really don’t understand at all. If firms like Tencent ever get their act together and roll out WeChat in places like Africa, it would be enormously popular."
Looking at the big picture, he warned that one had to keep perspective and realise from the outset that while Africa has a great future, it only has a modest present.
"China still does more trade with Germany than with all 54 African countries, which make up just five per cent of China’s entire global trade. So, if Africa disappeared today, it’d really be just a rounding error in the scheme of things," he said.
Mr Olander said both Africa and China share a lack of transparency, to it is difficult to get an accurate picture of the whole of private Chinese business activity. Nonetheless, he divides it into large, small and medium categories.
Excluding the government-to-government projects, connected to China's global Belt and Road infrastructure initiative, there are factory owners in the medium zone who are finding life difficult in China.
Chinese manufacturing is looking for lower-cost venues in which to operate because the cost of business is rising, the cost of labour is rising, taxes are rising.
"You can’t overstate how difficult life is in China. Costs are rising, competition is fierce, the economy is slowing. I expect this will spark another exodus."
Then there are pollution controls. "A friend of mine who runs a furniture factory in Shanghai," Mr Olander said, "is receiving pressure from the government to either clean up or shut down."
Last winter many factories in Beijing were closed because of the pollution they caused.
Some make a case that Africa can compete in a space that makes flip-flops, and such products that automation can’t beat. "So there is still a lot of opportunity for Chinese entrepreneurs to find cheap labour, a steady supply of raw materials, or certain goods in low-tech sectors," he said.
Not that all is problem-free. "There is a lack of reliable power supplies, reliable infrastructure, access to trained, loyal labour."
Then there is the risk of getting involved with a government that is later overthrown one way or another.
"Take Ethiopia, which is facing some political questions right now. China has really made its bed with the current government, so if the government changes, then China could be really exposed," Mr Olander said.
But he concedes that China did well in the Zimbabwean regime change. "I was one of the few that said: 'If Robert Mugabe goes, then China will be screwed given its decades-long support of his administration, as the Zimbabwean people will not forgive them for supporting Mugabe and any new government will want to cut ties and perhaps orient itself toward the West.'
"However, the fact that China managed to ensure not only continuity but also gain favour with the Mnangagwa government demonstrates the deft diplomatic skills that the Chinese are developing. Mnangagwa now looks to China as his primary partner," said Mr Olander.
Before examining small private investment, it is worthwhile to deal briefly with the large scale enterprises, but from whose experience most readers are unlikely too much.
While not government per se, a company like Huawei, which is private sector, has massive investment at the higher end.
"They are building up the networks, building marine cables, some of it with funding from the Chinese government, but a lot of it just to grow market share. Transsion Holdings, with the consumer arm TECNO, is a mobile phone company that has 30 per cent of the African mobile phone market - 30 per cent!
"It’s incredible. The private sector is revealing itself both on the large scale and on the entrepreneurial immigrant level as well. It’s a pretty dynamic space," said Mr Olander.
Then come the smaller SMEs. "In the past, there are different types of Chinese immigrants in Africa, right down to traders, who in previous years also went to the US, the UK, all over the world.
"For traders, there is nothing unique about what they’re doing in Africa. They’re people with low education, low skills, who will go to a country where there exists a Chinese network and open a shop.
"When I was in Kinshasa [Democratic Republic of Congo], I saw a number of Chinese who just owned corner shops, just as in America the Chinese opened dry cleaners. They find a need in the market, and fill it."
There are hundreds of thousands of this type of immigrant who have fled Fujian or Guangdong as they have for centuries, for a better opportunity to make more money, and for relief from the pressures of Chinese society.
In South Africa, there are the China malls, vendors who are importing low-cost goods from China and selling them for a tiny profit, but really they’re all over the continent as well.
These people are always going to be there. They will come and go depending on whether they can make money.
Asked if traders are a sustainable source of immigration into Africa, Mr Olander said: "Yes. The Chinese have had a migratory history for millennia. They are an adaptable, resourceful people. There is not a capital city in this world without a Chinese restaurant.
"As someone who grew up in California, where there has been a large Chinese diaspora for generations, I have no reason to believe that the Chinese won’t continue to leave in large numbers.
"At the lowest end of the employment scale, those immigrants buy one-way tickets. They are running their business in Africa, and that’s that."
For those who speak Chinese, he recommended looking at groups like QuFeiZhou, social networks for Chinese going to Africa.
People work as brokers that connect workers in Fujian with shop owners in various African countries, he said. "You can see first-hand how the migration is happening and where people are going from these message boards. People will go where they think there is an opportunity," he said.
Between, the spaces left between the large, medium and small, there is clearly room for many more Chinese, bereft of colonial baggage, to make Africa work for them and their new neighbours from the Cape to Cairo.
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