China's Expanding Role in Africa

[KingJaja]

King, you misunderstood my comment. I made no claim about Indians being angels. I just pointed out that the Indian govt is more able to obstruct its citizens-entrepreneurs-crooks than the Chinese govt. No moral superiority was implied (though one may or may not be present).
And why the italics on democratic? By current world standards, India is definitely a democracy. And of course, compared to China, it is clearly far more democratic.

Is this a perception or is it factually correct? If you know what India business men have been up to in Africa... On the other hand, the CCP can enforce good behaviour pretty rapidly if it wants to.

I get that India is perceived to be a better player than China, but is that perception factual. I suspect it could be, we don't know.

Why the italics on democracy? India could be democratic, but there is nothing in real terms that distinguishes China's Africa policy from India's Africa policy. The same scramble for energy resources, farm lands, bad labour practices etc. The major difference is that the Chinese government is more focused, disciplined and coordinated. The Indians aren't but they'd love to be doing every thing the Chinese are doing in Africa because unlike the West they really need Africa's oil and minerals and the Chinese are beating them to the race.

[Dayuhan]

Is this a perception or is it factually correct? If you know what India business men have been up to in Africa... On the other hand, the CCP can enforce good behaviour pretty rapidly if it wants to.

The CCP can't even enforce good behaviour in China: the corruption in the Chinese economy, much of it involving people with close to the CCP, is absolutely staggering. The West may have illusions that China is some sort of unstoppable economic juggernaut under tight central control, but the Chinese elite know better, and they're salting away money abroad as fast as they can, against the day when things fall apart.

Why the italics on democracy? India could be democratic, but there is nothing in real terms that distinguishes China's Africa policy from India's Africa policy. The same scramble for energy resources, farm lands, bad labour practices etc. The major difference is that the Chinese government is more focused, disciplined and coordinated. The Indians aren't but they'd love to be doing every thing the Chinese are doing in Africa because unlike the West they really need Africa's oil and minerals and the Chinese are beating them to the race.

Democratic regimes do not necessarily behave any better than non-democratic ones once they get outside their own borders.

Forgive my ignorance when it comes to those oil folks - Why haven't they been sent packing already ? I don't want to strike comparisons with the late Mobutu and his financial wizardry (which is why half of the Lebanese and Chinese never left Zaire), but I don't understand why Nigeria and her people don't go at it alone and get all the oil hungry dogs out.

That would be about money. Those who govern want the money, both because they need it to run the country and because a good bit of it goes into their own pockets. They don't have the expertise to run the industry themselves, so they deal with foreign companies.

The reality of foreign companies, regardless of where they're from, is that they will be as bad as you let them be, or as good as you force them to be. In the west there have been some attempts to constrain bribery, environmental abuse, human rights abuse etc from the home side, though effectiveness is limited. Overall, though, it's up to the host country government to establish and enforce limits. The question is whether they'll be willing to do that if they're on the payroll of a foreign investor.

Why do you think the Chinese are spreading all that baksheesh around and handing out favors to build influence and popularity, if not to protect themselves against unwanted interference in their business down the line? It may work or it may not - that's up to Africans - but I wouldn't expect there's anything resembling charity involved.

Of course western companies, governments, NGOs etc don't practice charity either: whatever they "give" is calculated to advance their own interests and agendas. Human nature is what it is.

[KingJaja]

The CCP can't even enforce good behaviour in China: the corruption in the Chinese economy, much of it involving people with close to the CCP, is absolutely staggering. The West may have illusions that China is some sort of unstoppable economic juggernaut under tight central control, but the Chinese elite know better, and they're salting away money abroad as fast as they can, against the day when things fall apart.

In the light of the rise of anti-Chinese candidates like Michael Sata in Zambia and the prominence of labour unions in Nigeria, there is a greater motivation for Chinese companies to "behave themselves" in Africa. True, they can get away with a lot in Africa's worst dictatorships, but do not assume that this is the case everywhere in Africa.

[KingJaja]

We've spent a lot of time talking about African perceptions of AFRICOM, but there is a Western perception of Africa that drives much of the West's policy towards Africa.

Read this essay, it neatly encapsulates the problem.

How to Write About Africa

Always use the word ‘Africa’ or ‘Darkness’ or ‘Safari’ in your title. Subtitles may include the words ‘Zanzibar’, ‘Masai’, ‘Zulu’, ‘Zambezi’, ‘Congo’, ‘Nile’, ‘Big’, ‘Sky’, ‘Shadow’, ‘Drum’, ‘Sun’ or ‘Bygone’. Also useful are words such as ‘Guerrillas’, ‘Timeless’, ‘Primordial’ and ‘Tribal’. Note that ‘People’ means Africans who are not black, while ‘The People’ means black Africans.

Never have a picture of a well-adjusted African on the cover of your book, or in it, unless that African has won the Nobel Prize. An AK-47, prominent ribs, naked breasts: use these. If you must include an African, make sure you get one in Masai or Zulu or Dogon dress.

In your text, treat Africa as if it were one country. It is hot and dusty with rolling grasslands and huge herds of animals and tall, thin people who are starving. Or it is hot and steamy with very short people who eat primates. Don’t get bogged down with precise descriptions. Africa is big: fifty-four countries, 900 million people who are too busy starving and dying and warring and emigrating to read your book. The continent is full of deserts, jungles, highlands, savannahs and many other things, but your reader doesn’t care about all that, so keep your descriptions romantic and evocative and unparticular.

Make sure you show how Africans have music and rhythm deep in their souls, and eat things no other humans eat. Do not mention rice and beef and wheat; monkey-brain is an African's cuisine of choice, along with goat, snake, worms and grubs and all manner of game meat. Make sure you show that you are able to eat such food without flinching, and describe how you learn to enjoy it—because you care.

Taboo subjects: ordinary domestic scenes, love between Africans (unless a death is involved), references to African writers or intellectuals, mention of school-going children who are not suffering from yaws or Ebola fever or female genital mutilation.

Throughout the book, adopt a sotto voice, in conspiracy with the reader, and a sad I-expected-so-much tone. Establish early on that your liberalism is impeccable, and mention near the beginning how much you love Africa, how you fell in love with the place and can’t live without her. Africa is the only continent you can love—take advantage of this. If you are a man, thrust yourself into her warm virgin forests. If you are a woman, treat Africa as a man who wears a bush jacket and disappears off into the sunset. Africa is to be pitied, worshipped or dominated. Whichever angle you take, be sure to leave the strong impression that without your intervention and your important book, Africa is doomed.

Your African characters may include naked warriors, loyal servants, diviners and seers, ancient wise men living in hermitic splendour. Or corrupt politicians, inept polygamous travel-guides, and prostitutes you have slept with. The Loyal Servant always behaves like a seven-year-old and needs a firm hand; he is scared of snakes, good with children, and always involving you in his complex domestic dramas. The Ancient Wise Man always comes from a noble tribe (not the money-grubbing tribes like the Gikuyu, the Igbo or the Shona). He has rheumy eyes and is close to the Earth. The Modern African is a fat man who steals and works in the visa office, refusing to give work permits to qualified Westerners who really care about Africa. He is an enemy of development, always using his government job to make it difficult for pragmatic and good-hearted expats to set up NGOs or Legal Conservation Areas. Or he is an Oxford-educated intellectual turned serial-killing politician in a Savile Row suit. He is a cannibal who likes Cristal champagne, and his mother is a rich witch-doctor who really runs the country.

Among your characters you must always include The Starving African, who wanders the refugee camp nearly naked, and waits for the benevolence of the West. Her children have flies on their eyelids and pot bellies, and her breasts are flat and empty. She must look utterly helpless. She can have no past, no history; such diversions ruin the dramatic moment. Moans are good. She must never say anything about herself in the dialogue except to speak of her (unspeakable) suffering. Also be sure to include a warm and motherly woman who has a rolling laugh and who is concerned for your well-being. Just call her Mama. Her children are all delinquent. These characters should buzz around your main hero, making him look good. Your hero can teach them, bathe them, feed them; he carries lots of babies and has seen Death. Your hero is you (if reportage), or a beautiful, tragic international celebrity/aristocrat who now cares for animals (if fiction).

http://www.granta.com/Archive/92/How...-Africa/Page-1

[Dayuhan]

This neatly encapsulates one stereotype, and in the process presents another. Of course the stereotype presented has some basis in reality, but most stereotypes do.

Western stereotypes about Africans are certainly an obstacle to productive relationships, but African stereotypes about the West are an equal obstacle. Individuals on both sides enjoy highlighting the prevailing stereotypes of the other, but both might be better advised to pay less attention to pointing out the absurdity of the other side's stereotypes and more attention to unraveling their own.

I suspect that it would be possible to assemble an equally amusing and equally accurate manual for Africans on "How To Write About the West", but that would prove little that we don't already know.

[M-A Lagrange]

Hey Kingjaja,

Makes more than a decade I live in Africa (several countries, so I will use the continent as a location)

The problem is not how to describe Africans in a condescending way. The issue, as Dayuhan said is why do so many individuals act according those stupid clichs!

My question is rather why do you refer to those stereotypes?
Why do you still try to explain why African people are different/victims and therefore deserve the right to blame west for everything?

Cause there is always an African guy involved. Never forget that you need to be 2 to do business. And that was Sedar Shengor who said it...

[KingJaja]

Interesting....

The milestone would mark a significant turnaround since 2008, the bank says, when exports to China stood at half of those to the US.
In a research note, Standard Bank's Beijing based economist Jeremy Stevens writes that "despite becoming marginally more expensive, China has managed to grow exports to Africa rapidly."

The estimate is the latest sign of deepening ties between the two regions, and Mr Stevens goes on to say that "Chinese and African businesses are now more comfortable transacting with one another. Looking forward, China is well-positioned to participate in Africa's next phase of development."

China has been at the forefront of reshaping the continents external relations in recent years, and Mr Stevens notes that its "foresighted engagement with Africa back at the start of the past decade was a master stroke, allowing Beijing to steal a march on Africa's other partnerships."

Bilateral trade volumes now exceed $160bn per year, or almost a fifth of the continent's overall trade - a 28 percent increase from 2011. Imports from China stood at $73bn in 2011, up more than 23 percent on 2010, while Africa's importance to overall Chinese trade is also increasing. The region now accounts for 3.8 percent of exports, up from 2 percent in 2002. The rapid growth in trade between the two regions is putting pressure on more established partners such as the EU and the US to strengthen their commercial ties with Africa.

Rapidly growing economic activity has gone hand in hand with political engagement. High profile visits by Chinese officials have become common place in Africa since 2000, including President Hu Jintao and Chinese Premier Wen Jiabao.

China has also begun making its mark as an emerging donor. In January a new $200m African Union headquarters was commissioned in Addis Ababa, Ethiopia. Funded entirely by China, the opening ceremony was attended by Jia Qinling, the country's most senior political adviser, who told those in attendance that "the towering complex speaks volumes about our friendship to the African people, and testifies to our strong resolve to support African development."

The relationship has however not been without controversy, and China regularly finds itself the subject of allegations that it undermines human rights and governance in its dealings with African governments.

China's focus on securing access to natural resources has also been the source of debate, with critics arguing that its interests do not represent a long term strategy and differ little from exploitative relationships that have done little to support development on the continent in the past. Fuels, ores and metals account for almost 90 percent of all Chinese imports from Africa.

In some resource exporting countries, notably Zambia, China's role has become a contentious issue in recent years. Having invested heavily in Zambia's copper industry relations have been strained amid allegations of mistreatment of Zambian workers by Chinese foremen; tension that has resulted in several deaths in recent years.

Despite such cases, China's role in Africa is likely to deepen significantly in the coming years. It is estimated that more than one million Chinese citizens now live on the continent, and a change of leadership in China later this year is not expected to result in a change of policy.

Standard Bank's Mr Stevens argues that "China's commodity demand is structural and will be longstanding. In addition, Africa's demand for infrastructure and China's differential approach to financing creates markets for Chinese exports; commercial opportunities for its [state owned enterprises] and employment opportunities for Chinese people.

http://www.afrika.no/Detailed/21313.html

[davidbfpo]

Catching up. This article on Zambia's white Deputy President is interesting in itself, but he makes a number of comments on the Chinese and I have slightly edited down the paragraphs.

Scott and Sata were swept to power on a vehemently anti-Chinese ticket. Scott admits they have had to tone down the ‘China-bashing’.

‘There was no need for it,, It was a shock tactic to point out the problems with the Zambian-Chinese relationship. The Chinese potentially have something very good to give, but they have a reputation for being somewhat ... inhumane. They employ far more people, but they are terrible managers.’

‘It’s an interesting paradox, the Chinese paradox ...You get open conflict quite a lot. The Chinese don’t understand that they should be dealing with the unions. What they tend to do is cosy up to the leadership, take them shopping and hope to sterilise them. Then they don’t have a conduit through which to speak to the workers ... We must recalibrate that relationship.’

‘We need to stop the silly things, like agreeing that so many Chinese can come here, no questions asked, then the next thing you know they have dominated the chicken market ... We deport Zimbabweans and Congolese all the time, poor sods who are refugees from economic hardship. Why should Chinese of unknown origin be sitting outside Lusaka growing chickens?’

Link:http://www.spectator.co.uk/essays/al...-presume.thtml

[KingJaja]

Catching up. This article on Zambia's white Deputy President is interesting in itself, but he makes a number of comments on the Chinese and I have slightly edited down the paragraphs.

It is much easier to campaign that to govern. When you start governing you immediately understand that Obama and Cameron's carefully crafted words don't translate into investment - America and Britain neither have the money nor the interest. The Chinese do, so they've got to play ball.

[JMA]

It is much easier to campaign that to govern. When you start governing you immediately understand that Obama and Cameron's carefully crafted words don't translate into investment - America and Britain neither have the money nor the interest. The Chinese do, so they've got to play ball.

... and there is nothing like a new Swiss bank account to help you tone down your criticism of China

[KingJaja]

... and there is nothing like a new Swiss bank account to help you tone down your criticism of China

Interestingly, the Chinese do the Swiss bank account thing a lot less than the West........

[JMA]

Interestingly, the Chinese do the Swiss bank account thing a lot less than the West........

You talking governments or corporates?

[KingJaja]

It doesn't matter. The Chinese Government doesn't do business in Africa, Chinese companies do.

[KingJaja]

By the way, what's the difference between Total and the French government?

[JMA]

It doesn't matter. The Chinese Government doesn't do business in Africa, Chinese companies do.

What exactly are you saying? That if you bribe less than the West or western companies its OK?

[Surferbeetle]

It doesn't matter. The Chinese Government doesn't do business in Africa, Chinese companies do.

A choice of models, Theme and variations, State capitalism is not all the same
Jan 21st 2012 | from the print edition, The Economist

Members of this new generation of managers are changing the management of the public sector, too, as they alternate between the corporate domain and government. There are currently 17 prominent Chinese political leaders who have held senior positions in large SOEs. Conversely, 27 prominent business leaders are serving on the party’s Central Committee. If state capitalism allows politicians to shape companies, it also allows companies to shape politicians.

State capitalism in China, Of emperors and kings, China’s state-owned enterprises are on the march, Nov 12th 2011 | from the print edition, The Economist

According to the Congressional report, state-owned firms account for two-fifths of China’s non-agricultural GDP. If firms that benefit from state largesse (eg, subsidised credit) are included, that figure rises to half. Genuinely independent firms are starved of formal credit, so they rely on China’s shadow banking system. Fearing a credit bubble, the government is cracking down on this informal system, leaving China’s “bamboo capitalists” bereft.

Those who argue that state-owned firms are modernising point to rising profits and a push to establish boards of directors with independent advisers. Official figures show that profits at the firms controlled by SASAC have increased, to $129 billion last year. But that does not mean that many of these firms are efficient or well-managed. A handful with privileged market access—in telecoms and natural resources—generate more than half of all profits. A 2009 study by the Hong Kong Institute for Monetary Research found that if state-owned firms were to pay a market interest rate, their profits “would be entirely wiped out”.

China State Construction Engineering Corp, by wikipedia

The CSCEC in 1982 as a state company. In 2002, CSCEC, international trade journal Engineering News-Record (ENR) ranked 16 of the world's largest international general contractor, and ranked 10 of China's largest companies by revenue or 12th rank in companies assets. The company with assets as of June amounted to 74.1 billion RMB in 2002, far ahead of the next largest construction companies in China. The total turnover of CSCEC since its inception was then estimated at 434.7 billion RMB, of which 30% abroad. 2006, the consolidated annual turnover at 117 billion RMB (equivalent to 11.2 billion euros or 18.6 billion Swiss francs).

China National Offshore Oil Corporation, by wikipedia

China National Offshore Oil Corporation (CNOOC Group Chinese: 中国海洋石油总公司 Pinyin: Zhōngguó Háiyáng Shíyóu Zǒnggōngsī) is one of the three major national oil companies of China.

CNOOC Group is the third-largest National Oil Company (NOC) in the People's Republic of China after CNPC (parent of PetroChina), and China Petrochemical Corporation (parent of Sinopec).

CNOOC Group is a state-owned oil company, fully owned by the Government of the People's Republic of China, and the State-Owned Assets Supervision and Administration Commission of the State Council (SASAC) performs the rights and obligations of shareholder on behalf of the government.

Nigerian National Petroleum Corporation, by wikipedia

The Nigerian National Petroleum Corporation (NNPC) is the state oil corporation through which the federal government of Nigeria regulates and participates in the country's petroleum industry.

Nigerian National Petroleum Corporation, Refineries & Petrochemicals, official website

The downstream industry in Nigeria is well established. NNPC has four refineries, two in Port Harcourt (PHRC), and one each in Kaduna (KRPC) and Warri (WRPC). The refineries have a combined installed capacity of 445,000 bpd. A comprehensive network of pipelines and depots strategically located throughout Nigeria links these refineries.

Shell Petroleum Development Company by wikipedia

Shell Petroleum Development Company (SPDC) is the largest fossil fuel company in Nigeria, which operates over 6,000 kilometres (3,700 mi) of pipelines and flowlines, 87 flowstations, 8 natural gas plants and more than 1,000 producing wells. SPDC's role in the Shell Nigeria family is typically confined to the physical production and extraction of petroleum. It is an operator of the joint venture, which composed of Nigerian National Petroleum Corporation (55%), Shell (30%), Total S.A. (10%) and Eni (5%). Until relatively recently. it operated largely onshore on dry land or in the mangrove swamp.

...and as we have discussed previously the West also has a number of SOE's to include Fannie Mae, Freddie Mac, and the National Health Service

[KingJaja]

Well what the French have been doing in Francophone Africa for the past fifty years, is by any definition, state capitalism.

I don't know why everyone is ganging up on the Chinese.

[KingJaja]

Everyone who does business in Africa bribes. Halliburton bribes, Shell bribes, Total bribes. These companies have given bribes for the past fifty years. The Chinese also bribe and suddenly it is big news?

[Surferbeetle]

Well what the French have been doing in Francophone Africa for the past fifty years, is by any definition, state capitalism.

I don't know why everyone is ganging up on the Chinese.

Not ganging up on China or France on this end and i hope for the best for Africa; infrastructure, education, business development are to be lauded in my book. My point, however, is that there is a vast and appreciable difference between a SOE (state owned enterprise) and a private company: scale, resources to draw upon, etc.

East Africa will be an interesting place to watch for what form capitalism will take, and how development/growth proceeds, as the proposed port in Lamu and the natural gas finds take shape.

Lamu port project launched for South Sudan and Ethiopia, 2 March 2012 Last updated at 10:35 ET, BBC News

Construction has begun on a $23bn (£14.5bn) port project and oil refinery in south-eastern Kenya's coastal Lamu region near war-torn Somalia's border.

An oil pipeline, railway and motorway will also be built linking Lamu to South Sudan and Ethiopia.

Newly independent South Sudan plans to use Lamu as its main oil export outlet.

Energy giants Statoil and Exxon target East African gas, By Russell Padmore
Business reporter, 19 March 2012 Last updated at 02:19 ET, BBC World Service

Statoil and its American partner Exxon Mobil have made the biggest offshore discovery yet of gas reserves off the coast of Tanzania.

I have been interviewing engineers of late and have noted Chinese training and African experience (on Chinese projects) among some of the candidates...the world grows smaller every day.

[Dayuhan]

I don't know why everyone is ganging up on the Chinese.

Is everyone ganging up on the Chinese? Who's "everyone"? I hear a bit of futile whining here and there, not sure how that equates to "ganging up". Certainly the Chinese don't care and probably barely notice.

Of course bribery has been standard practice for companies operating in Africa for decades. The complaints emerge because just about the time the US decided bribery was a bad thing and made it illegal (that law is not always observed, but it does create a substantial obstacle to US companies dealing in locations where bribes are expected), the Chinese came along with a state-sanctioned large scale bribery campaign. Depending on who you talk to, that can be seen as undermining the American campaign to promote morality or an unfair disadvantage for US companies.

There's also some complaints over the Chinese not playing along with the Western idea of forcing better governance by tying aid and investment to human rights performance, various reforms, etc. Of course whether there was ever any point to that in the first place is quite debatable, but there are some who get emotional about it.

Of course there are also some who seem convinced that the US or "the West" and China are in some sort of race or competition for African influence, and get all hysterical about the prospect of "losing". I personally think that's a bit silly, and it's not a view that's ever gained any great political traction, but it's out there.

I personally think Chinese investment in resource production in high-risk African environments is good for the US, particularly where oil is concerned. The Chinese are bringing oil onto the market that would otherwise not be produced, and even if every drop goes to China, that reduces Chinese buying from other sources and alleviates upside price pressure.

I don't think the US or "the West" need to fret over China's expanding role in Africa... for the Africans, maybe another story, but that's their business. The comment about Chinese chicken farmers in Zambia hints at what I suspect will be increasingly an issue in many places - Chinese immigrants taking over businesses and jobs that could be done by locals - but again, that's up to the countries involved to sort out. The pressure to sort it out is most likely to come from the workers and entrepreneurs who feel displaced, but how that happens remains to be seen. What is almost certain is that the local Chinese populations will not simply remain in their current economic and social niches. Their influence and presence will expand until it's constrained. How and when that happens remains to be seen, but I don't see any reason for the US or "the West" to be anything more than interested observers.