China – aid to improve development or aid as a form of colonialism – the case of Africa

11 Feb

The amount of aid from China to Africa has increased dramatically in recent years. What was traditionally a function of the OECD-DAC has now been taken over by China who invested a staggering $12 billion in 2012 and recently pledged at this summer’s fifth Conference of the Forum on Africa-China Cooperation, $20 billion of new aid to the developing continent. 

However this amount of aid has come under much scrutiny over its real intentions. China have described it as a form of South- south cooperation, (defined as the cooperation and sharing of resources amongst southern states who share the same common goals of development). However critics, mainly from the West, have claimed that there is an ulterior motive to this aid and thus acts as a form of neo-colonialism.

China has risen on the world stage as a potential superpower, however it has been cautious to display a peaceful rise and one of cooperation. It has based its rise on a foreign policy of non-interference and the upholding of states’ sovereignty, therefore when it provides aid to African countries it doesn’t impose the conditions that the West do via the International Financial Institutions. Thus China has used its shared history of colonization with Africa to forge new relationships, which stand to show up the West and their previous tenets of colonization and dependency.

Chinese companies have built many vital services of infrastructure such as transportation links from Tanzania to Zambia, ports in Angola, motorways in Sudan and many more. China’s popularity ratings are high in Africa (the only part of the world where they are favourable) and as Dambisa Moyo points out in her book ‘the winner takes all’, that not only are Africans content with the Chinese investment but it is actually more beneficial to African economies than aid from the IFIs and Western donors, which isn’t producing the benefits its has sought to and consequently there has been little development in sub-Saharan Africa over recent decades due to the neoliberal policies imposed upon them alongside their aid. Therefore, Chinese investment ‘without conditionalities’ is welcomed by African nations as the Chinese investors are improving the infrastructure of these sub-Saharan countries and thus increasing their economic growth.

However, due to China’s non-interference foreign policy, there has been much controversy surrounding these investments. Firstly, it is thought that the Chinese are using their ‘oil diplomacy’ (a term coined by Tull) to cement contracts of access to cheap natural resources. Eg. China provided a $1.8 billion loan to Ghana used for building roads in return for 15 years access to Ghana’s oil, which is sold very cheaply. Secondly, Chinese investment and aid is seen to uphold corrupt governments, as they do not impose conditions of good governance with their loans, as the West does. Eg. China has been criticised for having relations with ‘rogue states’ and Chinese aid was thought to be preserving Mugabe’s corrupt and isolated regime. Finally, much of the investment projects undertaken in Africa have not benefited the economy as much as some had hoped. There has been much criticism that Chinese companies haven’t used African workers but rather used Chinese workers and Chinese products, apart form some very low skilled work where they used local employees. This obviously has detrimental effects on the local economies and hasn’t actually helped their economic growth.

Chinas presence in Africa has caused a ‘resource race to Africa’ and a ‘scramble over Africa’ among the world’s developed powers, especially those who rely on the importation of oil. This is therefore a dilemma of Chinas involvement for development or dependency and thus access to resources. However, some more radical realists have even gone as far to say that Chinas involvement in Africa is their preparation for a forthcoming resource war with the West?

 

Sources:

Moyo, D. (2012) Winner Take All: China’s Race for Resources and What It Means for the World. New York: Basic Books 

Denis Tull, ‘China’s engagement in Africa: scope, significance and consequences’, Journal of Modern African Studies 44: 3, 2006, pp. 459–79.

Tanzania as largest beneficiary of Chinese aid:

China in Africa:

Chinas aid to Africa. Resources or friendship? http://www.youtube.com/watch?v=cf9hUkg1hT4 

China’s foreign aid to Africa:

http://www.washingtontimes.com/news/2012/aug/14/chinas-foreign-aid-to-africa/

Is China good or bad for Africa? http://globalpublicsquare.blogs.cnn.com/2012/10/29/is-china-good-or-bad-for-africa/

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4 Responses to “China – aid to improve development or aid as a form of colonialism – the case of Africa”

  1. pw9g10 February 12, 2013 at 4:51 pm #

    In general there are conflicting arguments surrounding Chinese aid. Firstly it has been suggested that China seeks to exploit the resource rich lands of Africa whilst giving little in return whilst it has also been said that Chinese aid is propping up rogue regimes. If aid from China is given with the intention to exploit Africa then it is expected that it also exploiting those African countries where corruption features heavily. Therefore aid to corrupt states will only boost the ruling regime in the short run (with the provision of finance) but then leaving them with little once the resources have been taken. This potential exploitation from China could ultimately cause the demise of these rogue states over a longer period should China be exploiting the recipient countries. However, governments can change but natural resources once depleted cannot be restored and so if this is the role China is playing then the potential development of Africa could be limited.
    Criticism from Western countries is highly expected considering China does not impose the conditions of aid adhered to by those involved with the International Financial Institutions. The result is that China is almost underselling its Western rivals when it comes to aid and gaining an advantage on the continent. Despite the arguments over China’s true intentions it is evident that Chinese aid has led to development in the form of improved infrastructure. Therefore to some extent the role of China in Africa has undoubtedly been a positive one.

  2. rh25g10 February 13, 2013 at 1:55 pm #

    Trade between Africa and China increased by 700% in the 1990’s and since the beginning of the 21st Century China has increasingly established its economic links with Africa, particularly sub-Saharan Africa. In 2006, trade between China and Africa totaled $50 billion with Chinese companies importing natural resources from countries such as Angola, Zimbabwe and Central Africa, and in August 2007 it was estimated that almost 750,000 Chinese Nationals lived, and worked, in different countries throughout Africa.

    The African communities have hailed the investment, trade and aid from China due to the socioeconomic enhancements it has created in many of the sub-Saharan countries, however to what extent has this investment been for the creation and enhancement of economic development in African countries? And to what extent is it in the interests of China? In return for the investment into African countries, China has received [all be it at a price] a vast amount of natural resources. Most notably the 10,000 barrels of oil a day received from Angola in return for $2 billion credit from the Chinese Government aimed to allow Angola to rebuild its infrastructure after 30 years of Civil War. However, not only has China secured such an important return in the form of oil, the credit has also ensured that only 30% of business contraction must got to Angolan businesses, whilst the remaining 70% of contraction is up for grabs…to the Chinese. It can therefore be argued that perhaps the Chinese Investment into Angola had relatively little to do with supporting the sub-Saharan country, and instead had a lot to do with supporting the Chinese economy. On top of this the British Watchdog on transparency, Global Witness, found that the money delivered to Angola was spent in a number of ways that were not set out in the credit agreement; this included financing propaganda for the 2006 presidential elections. The Chinese Government did little to ensure such corruption did not occur, and therefore the extent to which China’s investment can be seen to occur for the sake of developing African Nations can be further questioned.

    With China’s growing population and expanding economy the need for natural resources is unquestionable, however the methods employed in Angola give an example of the dominating nature of the Chinese tactics. What may be seen as a win-win situation by the Chinese can also be seen as a fresh form of neo-colonialism, with exploitation of African resources hidden under a seemingly successful process of South-South Development.

    Sources:
    China, Africa and Oil – http://www.relooney.info/SI_Oil-Politics/Africa-China_52.pdf

    China-Africa Relations- http://www.fmprc.gov.cn/eng/ziliao/3602/3604/t18059.htm

    China’s trade Safari in Africa – http://mondediplo.com/2005/05/11chinafrica

    Entrepreneurs from China Flourish in Africa – http://www.nytimes.com/2007/08/18/world/africa/18malawi.html?em&ex=1187582400&en=7b8806ea0f69e210&ei=5087&_r=1&

    The Growing Relationship Between China and Sub-Saharan Africa: Macroeconomic, Trade, Investment, and Aid Links – https://openknowledge.worldbank.org/bitstream/handle/10986/4406/wbro_22_1_103.pdf?sequence=1

    Large, D (2008) “Beyond Dragon in the Bush: The Study of China Africa Relations” African Affairs 107;426, pp 45-61

    Vivien Foster (2009), Building Bridges: China’s Growing Role as Infrastructure Financier for Sub-Saharan Africa (Washington DC: World Bank).

  3. lo2g11 February 13, 2013 at 11:41 pm #

    Many Western countries arguably have hidden motives for their involvements in both Africa and the Middle East; some of their involvements take the form of aid, military support and political intervention. It is questionable just because China has few conditions attached to their loans and aids that their motives are being scrutinised, by the West, who too are involved with the same countries in a similar way. China has also form links with Latin countries, which have been considered to be in the United State of America’s back yard and in so doing this; perhaps they are enacting a political move rather than an economic move. Highlighting that the problem may be with China engagement with these countries rather than the motivation behind their association.
    I would argue the problem here is that Africa is viewed merely in terms of its resources. This can be highlighted in the term ‘scramble for Africa’; when viewed in this way it is not surprising that many countries aim to take advantage of the scarce resources that Africa has to offer. Slavery and the process of colonisation have had a detrimental effect on Africa’s political and economic systems. Many conditional loans that have been handed-out in the continent previously can be said to enhance the problem, as many neoliberal approaches are Western centric and therefore overlook elements unique to African. Perhaps China’s differing approach, in light of their treatment from the West, may bring about a divergent outcome. It is important to note that Africa is a continent and not a country. Its array of history, religion and culture can mean that although the example of Mugabe cited did not depict a positive result, it could likely produce a differing outcome other Western parts of Africa; which hold fairer and more peaceful elections.

  4. db7g09 March 13, 2013 at 10:06 pm #

    From an international relations perspective, historical evidence show that there have been economic and political relationships between China and Africa as far back as 500 years ago (Mohan and Kale, 2007). A profound increase in the last two decades may have been related to the shifts in the world economy, geopolitical competition, and changes in Chinese foreign policy (Brautigam, 2003). According to Mohan and Kale (2007), the Chinese-Africa business contact is divided into three phases. The first phase from 1850 to 1950 related to colonial labour demand called “coolie trade.” Coolie trade focused mainly on plantation, mining, and railway construction. Alongside this were small but enterprising businesses that serviced Chinese labour markets and undertook small-scale export. The second period was from 1960-1980. With the establishment of the People’s Republic of China and the subsequent cold war, relations between China and Africa became political. China challenged the superpowers through foreign aid to Africa in order to cement ‘South-South’ relations. It also encouraged the independence movement in Africa. This is also when Chinese economic reforms were being instituted allowing liberalization, special economic zones, and permitting foreign direct investment (Shenkar, 1994). The last period is from 1990 to present, most noticeable in the last 5 years. Where we have seen movement of Chinese companies into African countries particularly in the areas of construction, mining, and oil extraction (Michel and Beuret, 2010), providing jobs for many local people.

    While Chinese relations with African countries have been positive in some ways, “serious questions” are being asked by Western and African intellectuals such as Dr Chris Alden, of the London School of Economics and Political Science and Dr Martyn Davies, director of the Centre for Chinese Studies at Stellenbosch University about China’s tactics and strategies in its quest for resources, rather than “helping with aid”. Many authoritarian African leaders have actually embraced the Chinese model allowing them to maintain a strong grip on political power (Brooks and Shin, 2006). Economy and Monaghan (2006) also mentioned that African leaders cite China as the ideal model for their countries and economies. The current recession has focused the world’s attention on financial problems from Iceland to Greece and from the US to Japan. Somewhat overlooked in this downturn is the relationship between Africa and China. Clearly, this is a very important relationship on many different levels and should concern western business and governmental interests.

    This relationship is likely to endure since both parties benefit to some degree. This is important to some African countries since it provides a different development model for aid and building an infrastructure and different rules of the game put forward as the “Beijing Consensus,” with its strong commitment to Africa. It is also attractive because it does not prescribe behavioural outcomes for African leadership. The Chinese seem willing to work with the African governments and have rejected criticisms. They are not apologizing for their activities (Wu 2010) and claim that the investments are now more ‘market driven’, not aid driven, which will cause hostilities amongst the African communities.

    Sources:

    Alden, C., & Davies, M. ‘A profile of the operations of Chinese multinationals in Africa’ (2006) South African Journal of International Affairs, 13(1), 83-96.

    Brautigam, D, ‘Close encounters: Chinese business networks as industrial catalysts in Sub-Saharan Africa’ (2003) African Affairs, 102, 447-467.

    Brooks, P., & Shin, J. H. China’s influence in Africa: Implications for the United States (Heritage Foundation, London: 2006) pp. 36.

    Michel, S., & Beuret, M, China Safari: On the Trail of Beijing’s Expansion in Africa (Nation books, New York: 2010) pp. 10.

    Mohan, G, & Kale, D. (2007). The invisible hand of South-South globalization: Chinese migrants in Africa. A Report for the Rockefeller Foundation prepared by The Development Policy and Practice Department, The Open University, Milton Keynes (2007). Available at:
    http://asiandrivers.open.ac.uk/documents/Rockefeller%20Report%20on%20Chinese%20diasporas%2010th%20Oct%20_3_.pdf

    Shenkar, O, ‘The People’s Republic of China: Raising the bamboo screen through international’ (1994) International Studies of Management and Organization, 24(1-2), 9-34.

    Wu, J.R, ‘China Rejects Criticism of Investment in Africa’ http://online.wsj.com/article/SB20001424052748704247904575240021751743004.html – 10 May 2010 [accessed 13/03/2013].

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