Africa is catching up. According to projections from the International Monetary Fund (IMF), Africa has surpassed Asia in its growth rate. Of the world’s ten fastest growing economies, seven are in Africa. And the consulting firm McKinsey & Company stated in 2010 that investments in Africa have higher return rates than any other. Foreign direct investment in Africa has grown dramatically, rising from $500 million in 2003 to near $15 billion by 2012. And while bilateral trade between China and Africa had already reached $11 billion in 2000, it surpassed $210 billion in 2014; at the current rate it is expected that by 2020 the amount of China’s trade with Africa will easily surpass $400 billion.
No wonder China is so interested in investing there. Since 2009 the world’s largest communist state has become Africa’s biggest trade partner, overtaking the United States. China’s policy of “non-interference” in the internal affairs of African countries makes it a more attractive trade partner compared to Western governments, which often demand democratic reforms and want to see progress on human rights issues. Furthermore, Chinese state-owned companies offer fewer bureaucratic hurdles and provide better prices and low-interest loans offered in partnership with state-owned banks.
Beijing’s aggressive strategy is paying dividends. In exchange for an open hand and a blind eye, China gets profitable licenses that allow it to exploit natural resources and fossil fuels indiscriminately. But there are consequences, of course: a panel led by former UN Secretary General Kofi Annan determined that Africa loses $38 billion a year because of corruption, tax avoidance, and mismanagement of natural resources—this amount surpasses the total global development aid to the continent. Protests in Madagascar, Senegal, Tanzania, and Ghana have also erupted over disputes between trade unions and Chinese business leaders or because foreign Chinese workers are preferred over local ones. For example, Chinese guards regularly find themselves in violent conflict with mine workers in Zambia, and in Angola it is believed that the Chinese use prisoners as forced labor (see Der Spiegel, “Billions from Beijing: Africans Divided over Chinese Presence”). In addition, China floods local markets with inexpensive goods (as it does in the rest of the world), something that damages small African manufacturers. “They undercut every price and are spoiling our business,” says a shopkeeper in Dar es Salaam, Tanzania.
In a tour of African nations Chinese Prime Minister Li Keqiang labeled such turmoil as little more than “growing pains” in the bilateral relationship, assuring African countries that China would not behave as a colonialist power. Still, the difficulties persist. China has enormous leverage due to its financial and trading power, and can outmaneuver many African regulations and institutions. And although it is unlikely that in the near future it will strive to place communist governments all over the continent, it is nevertheless noteworthy that China’s privileged position vis-à-vis African nations will affect discussions about democracy, freedom of the press and human rights in those countries. According to Senegalese writer Adama Gaye, China is already negatively affecting democratization efforts in the area, as it ignores corrupt or anti-democratic practices within African governments. It should be recalled that during Sudan’s humanitarian massacres in the Darfur region China still supplied its government with weapons, while also precluding any significant sanction coming from the UN Security Council.
The West should focus its strategy toward the region around a thorough strengthening of African democratic, social, and humanitarian institutions, including the media and the academy. Of course, increased commercial and financial engagement will also help build up and maintain durable partnerships on the continent. Whether China comes bearing authoritarian ideology or, as is more often the case in Africa, favorable terms of trade, Africa should think twice before swallowing the bait from Beijing.