Is China good for Africa?

You may struggle to guess the identity of China’s first official aid project in sub-Saharan Africa. A road, you may think, or a bridge? Perhaps a dam? All plausible, but ultimately wrong answers. In fact, it was a cigarette factory.

This pragmatic gift – smoking was, after all, very common in the 1960s – was made by Mao Zedong to Sekou Toure’s Guinea, after the west African nation had gained independence from France. It’s one of many thought-provoking revelations in Deborah Brautigam’s book The Dragon’s Gift: The Real Story of China in Africa.

From a cigarette factory outside Conakry, China’s engagement and presence in Africa has evidently come a long way. Today Beijing’s largesse in Africa has become so extensive it has led some to coin the term ‘Chafrica’ (see WiC43). More negatively, some Western commentators claim that China is less interested in developing Africa than in pocketing its natural resources. Fortuitously a WiC reader recommended Brautigam’s book as a balanced and considered take on this increasingly controversial subject.

Brautigam is certainly in a strong position to pass judgement. The Washington-based professor began researching China’s engagement with Africa in the early eighties – at a time when it was a far-from-fashionable academic pursuit. Currently with the International Development Programme at the American University’s School of International Service, Brautigam lived extensively in Africa, as well as China, having learned Mandarin in Taiwan. She’s also been a consultant for the World Bank and the UN. What she brings to this exercise are extensive experiences of aid in Africa – both by China and other nations – and 30 years of firsthand fieldwork.

Brautigam’s tone is nuanced. She begins by making clear that China’s involvement with Africa is not the new and revolutionary phenomenon that some newspapers would have us believe. In fact, if you ask a middle-aged Chinese about the country’s most famed project in the continent, the reflex response would be the Tan-Zam Railway, which began construction over 40 years ago. In 1967 Communist China offered to build Africa’s longest railway, stretching nearly 2,000km from the copper mines of land-locked Zambia through Tanzania to the sea. Ironically, it was originally the idea of arch-imperialist Cecil Rhodes and was rejected (some decades later) as impractical by the World Bank.

Little wonder there was scepticism when China agreed to build it. The railway required 300 bridges and 10km of tunnels. To get the job done China shipped in over 16,000 personnel. The railway was completed in five years and represented, says Brautigam, “the pinnacle of the kind of struggle, hardship and ‘glorious achievement’ pushed by Mao”. In a 2006 CCTV documentary about the Tan-Zam Railway, one veteran recalled “drinking the water we found in elephants’ footprints”.

Such grandiose Maoist endeavours marked the first phase of China’s involvement with the newly independent African nations. A new approach began to emerge under Deng Xiaoping – one which continues to characterise China’s involvement with Africa today, says Brautigam. It’s an approach that mirrors China’s own developmental experience.

In 1978 China was an agrarian economy with huge reserves of many natural resources, but even more immense poverty. In order to push Deng’s ‘four modernisations’, the Chinese did a deal with Japan. Its more developed neighbour would lend China $10 billion in low interest yen loans to finance the export of Japan’s modern plant, industrial technology and materials. In return, Beijing agreed to pay its bills by exporting the equivalent in crude oil and coal to Japan. It was the first of many resource-backed loans that China would strike not only with Japan but European countries too, as it sought to kickstart its ambitions of becoming a manufacturing powerhouse.

Brautigam says the Chinese believe they can replicate this success with Africa. China saw how resource-backed loans helped to transform its own economy over 30 years and is now offering African governments a similar deal. It is prepared to make loans – backed by oil, copper and so forth – and in return send in its engineering companies to build much- needed ports and other infrastructure, as well as open factories.

Another advantage for many African governments of this approach: unlike Western donors, the Chinese will make these loans without adding the conditionalities typical of the Washington Consensus. “It is not difficult to get African government officials to expound on the contrast between China’s approach and the detailed and intrusive conditions often considered necessary by international donors,” writes Brautigam. “As the former Sierra Leone government minister Dr Sesay told me, the Chinese will simply build a school, a hospital, and then supply a team of doctors to run it. ‘The World Bank will say you must not have so many teachers on your payroll. You must cut down on your wages.’ The Chinese won’t do this. They will not say ‘You must do this, do that, do this!’”

Brautigam also says China’s leaders have been careful to treat African governments on more equal terms, as fellow developing nations. For example, since 1991 China’s foreign minister has traditionally visited a group of African nations at the start of each year (no Western nation has a similar diplomatic tradition). Writes the author: “An African ambassador pointed to this in 2008 after a talk I had given to a group of African ambassadors in Washington. ‘China gives Africans more respect than they get from the West.’ I was struck by how many other ambassadors nodded in agreement.”

For many African leaders, China’s recent track record contrasts favourably with the West’s. Brautigam cites Senegal’s President Abdoulaye Wade, who noted that China had helped African nations build infrastructure projects in record time. “The Chinese are ready to take up the task, more rapidly, and at less cost”, Wade remarked approvingly.

Those cost differences can be significant, with Brautigam contrasting the expense of employing Chinese experts versus many of their Western equivalents. “How can you reduce poverty, but live in a five-star hotel?” Brautigam recalls a Chinese scholar asking her, noting that expats from the West often tend to live in such environments. “In Mozambique, donors hired 3,500 technical experts (usually foreign) paying out $350 million per year, a sum equal to the salaries of 400,000 local people. Several of these experts are friends of mine, some are former students. They do great work, I am sure, but they also cost a lot.” A World Bank official also tells her that they welcome the Chinese competition for contracts, to reduce some of the premium charged by European contractors.

Of course, the Chinese see African development in terms of generating business for their own firms too. Beijing sees nothing incompatible with mixing business and aid. Brautigam gives the example of a mobile phone project in Sierra Leone.

The project was suggested by Chinese telecoms equipment maker, Huawei and built on behalf of state telco Sierratel. It was financed with a concessional loan from China Eximbank (2% interest, repayable over 20 years).

The Chinese see this as a win-win situation: studies prove that a mobile phone network benefits local development and stimulates economic activity; meanwhile selling it undeniably benefits Huawei’s bottom line too.

Criticisms of the Chinese approach have been reported widely. Take this example from TIME: “Some countries, however, are no longer as willing to extend a red carpet toward the globetrotting Chinese. Although political strings might not come with Beijing’s cash, there are economic catches. The roads, mines and other infrastructure on offer are most often built by armies of imported Chinese labour, cutting down on the net financial benefit to recipient nations. Chinese companies investing abroad also tend to ship in nearly everything used on building sites, from packs of dehydrated noodles to the telltale pink-hued Chinese toilet paper.

“It’s not only the contracted Chinese workers who show up, either. Within a few years, their relatives invariably seem to materialise to set up shops selling cheap Chinese goods that threaten the livelihood of indigenous entrepreneurs. Locals who do get work on Chinese-funded projects complain that their bosses don’t heed national labour laws ensuring minimum wage or trade-union protection. Over the past three years, anti-Chinese riots have erupted everywhere from the Solomon Islands and Zambia to Tonga and Lesotho.”

Brautigam’s final chapter addresses these concerns, and asks whether China’s net impact is more negative. Her treatment is even-handed. Yes, the Chinese often bring in their own workers; but in the bulk of the projects she analyses more than 90% of labour is local. Sometimes local skills do not actually exist, necessitating the greater Chinese presence.

Are the Chinese just after Africa’s resources? Well, yes, they are making resource-backed loans, but Brautigam says it’s too simplistic to see it just in terms of oil and metals. She lists projects that demonstrate China is offering aid and assistance in virtually every country in Africa – resource rich or not.

On balance, she doesn’t think China is making corruption in Africa any worse (but adds that the Chinese are “definitely not making it better, either”). On the downside, she predicts China’s strategy for selling local farmers its hybrid seeds will prove negative for Africans. Likewise she doesn’t favour China buying up farms to create their own privately-managed plantations. Beijing’s agricultural strategies in Africa could make poverty worse, she argues.

Her final verdict: China is by no means always a force for good, but nor does it deserve to be demonised as a ‘rogue donor’.

For Brautigam it comes down to this: “The deals they offer in Africa are based on similar deals Japan and the West offered China, decades ago, and which the post-Mao Chinese accepted in the belief that they could also win from an approach that was not about aid, but business.”

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