In November 2006, Hu Jintao, then President of China, read out a declaration at the summit of the third Forum on China–Africa Cooperation (FOCAC) in Beijing. Flanked by dozens of African leaders, Hu announced both the creation of the China–Africa Development Fund to expand Chinese investment in Africa and more than US$5 billion in concessionary loans to the continent. At the largest ever summit on African affairs held outside of Africa, China was presenting itself as a major economic partner for Africa. There have been two FOCAC summits since then: Egypt hosted the fourth in 2009 and the fifth again in Beijing in 2012.
On the face of it, the relationship between China and the nations of the African continent is based on a mutually beneficial economic exchange in which Chinese manufactured goods and investment are exchanged for African natural resources. Bilateral trade stood at just over US$10 billion in 2000, the year of the first FOCAC meeting, held in Beijing. By 2012, this figure had rocketed to US$198.5 billion, an increase of around nineteen percent on 2011 and far higher than the value of US–African trade, which was US$108.9 billion in 2012. According to data cited by the independent Canadian think tank Global Research, China imports around 870,000 barrels of oil per day from Africa — a third of China’s total oil imports. Angola is China’s leading supplier of oil, the Democratic Republic of the Congo of cobalt and South Africa of manganese, chromium and platinum. South Africa is China’s only African trade partner that also exports to China substantial amounts of manufactured goods.
Using conventional measurements of Outbound Foreign Direct Investment, Chinese investment in Africa is still far behind that of Western nations despite jumping from US$100 million in 2003 to more than US$12 billion in 2011. Yet, while investment from Europe and the US in Africa typically divides along the lines of private-sector direct investment on the one hand and Official Development Assistance (usually undertaken by the government sector with the goal of promoting welfare and development), China combines trade and investment with aid. Thus, China commonly makes use of natural resources-backed lines of credit; in other words, a Chinese policy bank like the Exim Bank uses preferential access to natural resources in Africa as collateral for infrastructure projects or as a means to repay loans.
A deal that China signed in the Democratic Republic of the Congo in 2001 set the tone for many more in the years to come: China would provide US$280 million for dam construction and receive loan payments in oil. It concluded a similar deal in Angola in 2004 when Exim Bank provided US$2 billion for the development of energy, telecommunications, railway and water infrastructure. As part of the repayment terms, Angola agreed to supply China with 10,000 barrels of oil per day. In a pattern that would be frequently repeated, one Chinese business was awarded contracts for the infrastructure projects, while rights for extracting natural resources accrued to another, a Chinese oil company. Following these agreements, Chinese contractors, extractors and other business people have flocked to Africa, extracting resources and building urban infrastructure, railways and mines. China constructed the grand 51,887-square-metre African Union headquarters in Addis Ababa, opened in January 2012, as a ‘gift’.
Although the relationship is theoretically based on mutually beneficial exchanges, it has not been problem-free. For example, there have been labour disputes, including one particularly troubling instance in Zambia in 2010 when Chinese managers opened fire on their African workers. There have also been complaints in various African countries that some of the public buildings constructed by Chinese companies as part of resource deals have already started to crumble, and some African countries have grumbled about the large influx of Chinese labourers and business people. And clearly, not all Africans are enamoured by strong links with China. In an article in the Financial Times on 11 March 2013, Nigerian Central Bank President Lamido Sanusi complained about the Sino–African trade relationship as being slanted in favour of China:
China takes our primary goods and sells us manufactured ones. This was also the essence of colonialism. Africa is now willingly opening itself to a new form of colonialism.
Sanusi derided China’s relationship with Africa as carrying a ‘whiff of colonialism’, and concluded that Africa must see China for what it is: a competitor.
Chinese and African workers sit side by side.
Photo: Sam Seyffert
Xi Jinping proceeded to Africa on his first foreign diplomatic trip as President of China in March 2013, and delivered a policy speech on China–Africa relations in Dar es Salaam on 25 March in which he reaffirmed China’s commitment to be a faithful and valuable partner for Africa. In private diplomatic discussions, such as that with the Congolese President, Xi Jinping reportedly also made veiled references to Sanusi’s claims by assuring his host of China’s good intentions in Africa. Nevertheless, Sanusi’s broadside did apparently cause some distress among Chinese officials, at least those in Nigeria. Quoting unnamed ‘diplomatic sources’, the Nigerian newspaper This Day reported in April that Sanusi’s article had elicited complaints and denials from Chinese diplomatic staff in the country, and reported that some ‘indications’ seemed to suggest that the Chinese government may have embarked on a comprehensive review of its ‘business role’ in Nigeria.
In July 2013, the South African Minister of Public Enterprises, Malusi Gigaba, also expressed doubts about China’s role in Africa, although in a slightly less provocative fashion than Sanusi. Gigaba called for greater scrutiny of funding from China and other BRICS countries for infrastructure investment in Africa, and warned Africans not to ‘sell our souls’ to secure funding in a world where finance was becoming less available for infrastructure. In Gigaba’s view, Chinese funding should not be refused but nor should it come at the expense of the development of African skills and manufacturing potential. Some Western commentators and politicians have also painted China as a neo-colonial overlord in Africa.
The following are some of the most noteworthy events involving China and Africa over the past twelve months:
- August 2012: Thirty-seven Chinese criminal suspects are arrested in Angola and extradited to China for crimes carried out against other Chinese nationals in Angola.
- March 2013: In his first foreign trip as President, Xi Jinping visits Tanzania, South Africa and the Republic of Congo, signing a number of trade deals.
- May 2013: The Chinese government offers to provide 500 troops to the United Nations to bolster the peacekeeping force deployed in Mali. China previously contributed almost 2,000 peacekeepers to other UN operations, but this offer marks the first time it has put forward its peacekeepers for a role that has a strong probability of involving military action.
- June 2013: Ghana deports 3,877 Chinese miners during a clampdown on illegal mining. The Chinese miners, hoping to take advantage of a gold rush, are blamed for security problems in mining regions.
