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Sunday, January 22, 2006

Africa and China

As the economic ties between China and Africa grow stronger, there are questions about the nature of the evolving relationship:

A match made in Beijing, by Lyal Whi, Mail & Guardian Online, South Africa: Africa needs China. ...China’s insatiable appetite for natural resources is creating unprecedented demand for commodities, pushing prices to new highs and fuelling economic growth across the continent. But China’s relations with Africa have stirred a polarised debate from Cape to Cairo. China is either the next big thing, usually in the view of business and some governments. Or it is the red peril, the new coloniser...

In terms of political ideology and approaches to socio-economic development, China is closely aligned to countries of the south. This has ... shaped China’s relations with countries in Africa and elsewhere and created a somewhat idealistic impression of the distant partner or big brother in the East ... Many Africans still believe that relations with China are of an altruistic nature. They tend to forget the hardnosed commercial reality that now determines international relations -- and relations with China in particular.

They are seemingly unaware of the fact that China’s relations with Africa are merely part of a broader strategy of engagement with the developing world, focused on the search for natural resources. Reliable access to resources is essential for ongoing growth and development and is at the core of China’s national interests. In this respect, China and Africa are ideal partners. Africa is a treasure trove of metals and minerals and has huge agricultural potential. ...

But China’s relations with Africa have faced criticism. Firstly, trade imbalances are increasingly in China’s favour and large-scale dumping of cheap manufactured products are undercutting local industries. ... The South African clothing and textile sector has lost more than 100 000 jobs since 1995 due largely to the influx of cheaper products from China. Trade with China has, if anything, worsened unemployment and poverty in South Africa, which are two of the most pressing problems facing the country today.

Secondly, the slow trickle of long-term fixed investments from China indicates a lack of commitment in Africa. ... Finally, the nature of Chinese activities on the continent ... are often accused of undermining the principles of good governance and human rights, is a source of controversy both on the continent and abroad. The use of Chinese labour on many of the African based contracts is also a point of contention. ... China’s so-called “respect for sovereignty” carries little resonance among human rights groups ...

China needs Africa. Apart from Latin America, Africa is probably the richest diversified source of metals, minerals, fuel and agricultural produce in the world. ... China is also seeking greater international recognition and leverage in multilateral organisations. Africa is able to provide such support and assist China in improving its “soft power” of influence and acceptance worldwide.

China-Africa relations are first and foremost commercial in nature. But China’s pursuit of business interests in Africa should not disregard the principles associated with political good governance. ... Finally, Africa can learn from China’s process of economic development and liberalisation, which has turned it into an investment magnet and one of the most competitive markets in the world. An improved investment climate in Africa will guarantee a reliable supply of resources and unlock vast potential in the labour market.

    Posted by on Sunday, January 22, 2006 at 01:56 AM in China, Economics | Permalink  TrackBack (1)  Comments (4)

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