CHINA IN SUB-SAHARAN AFRICA: Demand Extracting Supply
Abstract
The Chinese are opportunists. When it comes to extracting natural resources from sub Saharan Africa, they see opportunity where others see chaos, corruption, political strife, and debt ridden third world economies. The quest for energy and other resources has swiftly directed China’s attention to Africa. Africa remains rich in natural resources especially oil reserves that have not been developed and by the West. China needs Africa’s raw materials to sustain its economic growth. This topic is important because it focuses on the history and depth of China's natural resource extraction in sub-Saharan Africa (henceforth referred to as “Africa”, denoting the 47 countries that make up sub-Saharan Africa, but only a few of them will be discussed in this paper) from decades ago to the present. This paper will focus on China’s foreign policy and voracious appetite for natural resources in Africa which will likely alter the balance of power between Africa and world powers.
This paper will present a brief historical overview of the China-Africa investment and trade relationship. This will lead into a description of the current state of China’s extraction of natural resources from Africa, including China’s current trade policies, strategies and methodologies, China’s use of concessional loans, foreign direct investment, aid, oil strategies and other methodologies that allow China to achieve its foreign policy goals in Africa quickly and effectively. Finally, this paper will conclude with a brief forecast of how China’s trade, aid, and investment policies toward Africa will be forced to change. If China is to avoid social and political strife in Africa, it will have to reform its African foreign policy.
Historical Overview of the China-Africa Investment and Trade Relationship
From the 1950s to the 1970s, China built and strengthened its influence in Africa by exporting revolution and ideology. In an era when war and communist revolution were the main themes, promoting the values of anti-colonialism, anti-hegemonism, economic self-reliance, global cooperation and independence won China friendship and influence on the African continent.1 China’s communist government during this time period formed approximately 23 formal relationships with African countries.2
The formal beginnings of China’s African policy were proclaimed during the visit of Zhou Enlai – the first Premier of the People’s Republic of China who served from October 1949 until his death in January 1976 – to ten African countries during the years 1963 and 1964. Outlined during Enlai’s Africa tour, China’s Five Principles Governing the Development of Relations with Arab and African Countries include support for Africa’s anti-imperialist and anti-colonial movements; liberation movements; and nonalignment policy, in addition to respect for Africa’s sovereignty and opposition to any form of (foreign) invasion and interference in Africa’s affairs.3 China, however, in the 1970s had an additional motivation for trade, aid, and investment with Africa. As pointed out in The Dragon’s Gift:
“In the 1970’s, strategic diplomacy remained the chief motivation behind China’s aid: wrestling diplomatic recognition away from Taiwan [in the United Nations] and countering the influences of both the West and, in particular, the Soviet Union.”4
As early as the 1970’s, however, the China-Africa relationship began to shift away from these five principles. China moved from radical revolutionary to an “open door” economic policy, designed to attract foreign trade, investment, and joint-venture opportunities with western countries. China even started the process that would eventually result in it joining the World Trade Organization.5 As China refocused its relations with Africa from ideological to economic in the 1990s, the commonly accepted view of China in Africa changed from an ideological ally against colonialism, apartheid, and western domination to business partner.6
Mr. Xinghua, a former Chinese diplomat and professor of international relations who was posted in the Guinean capital city of Conakry saw Zhou Enlai on an official state visit in Sekou Tour’e in 1963. In an interview with the authors of China Safari, Mr. Xinghua recalled that in 1963 China’s attitude toward Africa had not always been exemplary, but it had evolved. He considered Zhou Enlai’s era the “golden age” of China’s relationship with Africa, when China gave aid and established close relationships without the expectation of mutual benefit. Professor Xinghua recalled how in the beginning of the 1990’s China’s the transition to a market economy changed the country’s position with its African friends. Cooperation between China and its partners in Africa shifted to a new reality where aid was no longer one-way; rather, cooperation would become focused on mutually beneficial economics.7
This policy of “mutual benefits” formally began with the first China-Africa summit in Beijing in 2000.8 China’s lack of transparency in its trade, aid, and investment dealings with African governments often causes alarm. From China’s point of view, however, the “mutual benefits” approach generates business in both countries, and is not mere extraction of oil and natural resources in exchange for infrastructure projects.9
Current State of China’s Extraction of Natural Resources from Africa China’s quest for resources, economic opportunities, and influence in Africa is now more reality than dream.
“Overall, China’s push into Africa has been remarkably successful [with returns on investment reported as high as 10 to 30%]. Chinese companies are sucking up oil from Angola and Sudan, cutting down timber in Guinea and mining copper, zinc and other minerals in Congo. Beijing recently bought a major stake [20%] in South Africa’s Standard Bank to fund infrastructure projects throughout the continent. As recent as August 2011 China is showing strong indications of investing $5 billion USD as indirect investment in Nigeria’s power and road projects10. China is far outpacing its Western rivals, opening more embassies in Africa than the United States has, and even investing heavily in countries, like Rwanda, where the immediate returns are murky at best.”11
This displays that China has made massive investments in Africa, even where human rights violations and political instability are present.
China’s investment and FDI in Africa
One of the most impressive economic statistics related to China’s role in Africa is the level of foreign direct investment (FDI). The amount of FDI in 2003, $74,810,000 USD, rose to $5,490,550,000 USD by 2008.12
The vast majority of Chinese FDI inflows to Africa over the past decade have been concentrated in extractive industries, which require large amounts of capital investment in equipment. The equipment procurement, bought in China, not in Africa, creates limited domestic employment in African nations. However, in recent years, China has begun to diversify its investment into other sectors, including apparel, agro-processing, power generation (energy), road construction (infrastructure), tourism, and telecommunications, among others, creating a greater demand for African employment.13
The volume of Chinese FDI in Africa has grown rapidly. In 2005, Chinese FDI in Africa amounted to $1.3 billion USD; a small amount compared to EU and US levels of FDI in Africa. However, as noted above, by 2008, the level of FDI grew to almost $6 billion USD. The rate of growth of Chinese FDI is both remarkable and controversial. Even more remarkable is that Africa currently accounts for only 2% of all Chinese FDI stock14 and 5% of China’s total FDI.15 Yet these numbers are modest compared to the value of trade.
China’s Trade with Africa
From 2001 to 2007 China’s trade with Africa increased 681%, only slightly slower than the growth of China’s trade with Latin America in the same period (687%) and slightly faster than China’s trade growth with the Middle East (600%), and the Association of South East Asian Nations (ASEAN) (487%).16
Trade volume in a snapshot is shown below in Figure 1. Since 1995 African exports to China have grown from approximately $2.5 billion USD to over $5 billion USD. Africa’s imports from China in the same period have gone from approximately $1.3 billion USD to approximately $5.8 billion USD. Simultaneously, Africa’s share of world exports decreased dramatically from over 7% in 1948 to 1.7% in 2004.17
An argument can be made that China’s trade with Africa has had a negative impact on Africa’s exports to the world because Africa’s industries cannot compete with China’s low cost. Questions arise as to whether China’s raising imports to Africa have decreased Africa’s manufacturing output by undercutting African companies and putting them out of business.
Figure 1 China-Africa Trade Statistics 1995-2000 (US $ million)
Source: World Atlas Trade Data, Tralac Analysis. Compiled by the Department for International Development. Daddi, Ketema Meskela. The Political Economy of China-Africa Relations Historical Overview: The Case of China-Ethiopia Relations From 1949-2006. PhD Dissertation. 2009
What and how much China extracts from Africa
The main raw materials exporters to China are Angola, South Africa, Sudan, Congo, Equatorial Guinea, Nigeria, and Gabon. These seven countries account for approximately 90% of Africa’s raw material exports to China.18 They are representative of what China imports, and therefore extracts from Africa. Table 1 provides information on what raw materials are being extracted by China from the twelve largest African exporters to China.
Table 1. Raw Materials China is Extracting from Africa by Country
COUNTRY RAW MATERIAL
Angola Oil
Sudan Oil
Congo (Brazzaville) Oil, Timber, Base metals
Equatorial Guinea Oil and Timber
Gabon Lumber, Iron Ore, and Manganese Zambia Copper and Base Metals
Nigeria Oil
South Africa Iron ore, Diamonds, Base Metals, Platinum, Manganese, Copper and Aluminum
Ghana Manganese
Namibia Copper
Democratic Republic of the Congo Raw Materials (Misc)
Cameroon Timber
Chad and Mauritania may soon join this group
Not Available
Source: David H. Shinn, “Military and Security Relations: China, Africa and the Rest of the World,” in Robert I. Rotberg, ed., China into Africa: Trade, Aid and Influence (Washington DC: Brookings Institution Press, 2008) 155.
The large unmet domestic demand for natural resources in China is due to growing demands from industry and consumers for energy and materials. For example, the average daily consumption of crude oil in China went from 320,000 tons per day in 1990 to 932,000 tons per day in 2007.19 Average demand for electricity consumption for Chinese households went from 13.4 kWh (kilowatts per hour) in 1983 to 274.9 kWh in 2007.20
Africa’s rapidly growing exports to China, however, are not limited to fuels and other mineral and metal products. Labor-intensive raw or semi-processed agricultural commodities that are further processed in China, either for industrial use (timber, cotton) or for consumer use (food products), are also increasingly imported by China from Africa. The African countries with significant exports to China are few. Five oil and mineral exporting countries account for 85% of Africa’s exports to China.21 This statistic bolsters the argument that China’s main interest in Africa is natural resource extraction.
At 62.20% to 80%, (depending on the source and time frame of the measurement) oil makes up the majority of Africa’s exports to China.22 Figure 2 shows the breakdown of what is being extracted from China in percentages according to Rotberg’s, China into Africa: Trade, Aid and Influence. Other sources report a slightly different breakdown for exports to China.23 Nevertheless it is undisputed that trade between Africa and China has been dramatically increasing. Table 2 provides information on China’s crude oil imports from the largest oil producing countries in Africa.
Figure 2
Source: Harry G. Broadman, “Chinese-African Trade and Investment: The Vanguard of South-South Commerce in the Twenty-First Century,.” in Robert I. Rotberg, ed., China into Africa: Trade, Aid and Influence (Washington DC: Brookings Institution Press, 2008) 99.
Table 2 China’s Crude Oil Imports from Select African Countries for January 2010
Countries Jan 2010 in Tons Change in Year Angola 3,360,687 +53.44
Sudan 1,149,869 +130.25
Congo 388,409 -1.46
Equatorial Guinea 137,526 Not available Source: Chinaoil web.com. www.chinaoilweb.com. (accessed November 11, 2010)
China’s African Investment, and Trade Policies, Strategies and Methodologies China asserts that its investment and trade policies strategies, and methodologies, as well as its aid policies still follow the “no strings” principle stressed by Chinese Premier Zhou Enlai in 1960. China further asserts, contrary to its policies, that it is the West that tries to impose a market economy, economic reforms, good governance, and multi-party democracy on countries where conditions are not suitable for these measures. China has used different strategies in Africa. One largely untried strategy to a great extent by the West involves institutionalizing Sino-African relations through regional organizations such as the New Partnership for Africa’s Development (NEPAD) and the Forum of China African Cooperation (FOCAC).24 China’s involvement in African regional organizations goes a long way in its understanding of Africa so as to provide some understanding about Africa which lowers their risk adversity about investing in Africa.
China’s emerging Strategic Partnerships in Africa
Numerous visits by Chinese premiers and foreign ministers since the 1990’s highlight the commercial importance of the China-Africa relationship. The watershed event was the 2006 Forum on China-Africa Cooperation. This was known as China’s “Year of Africa.” It commemorated 50 years of China-Africa diplomatic relations. This summit with 48 of the 53 African countries represented caused China to produce a list of future initiatives which included: a) A new type of China-Africa strategic partnership characterized by political equality and mutual trust, economic win-win cooperation and cultural exchanges;
b) High-level bilateral visits to maintain the positive momentum of Sino-African relations; c) Collaboration to double bilateral trade volume by 2010;
d) A China-Africa development fund (US$5billion) and Special Economic Zones in Africa to encourage investment;
e) $3 billion in preferential loans over three years;
f) $1 billion worth of African debt cancelation;
g) A $37.5 million grant for anti-malarial drugs over three years;
h) Assistance to African countries to build 30 hospitals and 30 demonstration centers for the prevention and treatment of malaria; and
i) 100 rural schools in Africa over the next three years and a doubling of the number of current scholarships given to Africans to study in China from 2000 to 4000.25 The 2006 Forum on China-Africa Cooperation contributed to the growth of trade between China and Africa. China has now become Africa’s third largest trading partner after the United States and the European Union.26
China’s oil strategies in Africa
China’s most important strategy in Africa is its oil strategy. China has been an oil importing country since 1949. From 1950 to 1959, China’s annual import of oil increased from 0.33 million tons (mts)/year to 3.33 mts/year. In the early 1960s, when the Soviet Union ceased to provide assistance and oil to China, China experienced a serious oil shortage. It then developed its own oil production capability. In 1965, China’s output of oil reached 10 mts/year or 97% of the country’s oil needs and it was self-sufficient in oil. In 1993 China’s oil demand again began to grow and it became a net-importer of oil again. China’s demand for oil has doubled from 1997 to 2007, increasing from approximately 3.3 million barrels per day (bpd) in 1995 to 6.6 million bpd in 2005. Currently the domestic oil supply of China has failed to keep pace with this increasing demand and the outlook for substantially increasing it is grim. The oil fields of China have reached maximum production capacity. China’s oil imports are expected to increase from 3 million bpd in 2005 to between 6 million and 11 million bpd in 2020 or approximately some 60% to 80% of its oil consumption. As early as 1992 China’s central government put forward the strategic policy of developing China’s oil industry through domestic and overseas markets.27
On January 1, 2001, Mr. Chen Jin Hua, former director of the Chinese National Planning Committee advocated establishing oil fields abroad or the ‘going out’ strategy.28 The two major objectives of the strategy were to encourage China’s oil companies to follow the example of international oil companies in the development of oil equity (extracting and purchasing raw crude oil at the source rather than purchasing processed or semi-processed oil products) and to look for income and rent from the upstream sector (exploration and production). The other objective is to create internationally competitive firms that can compete with the world’s leading corporations. In the 1990’s one of China’s major state oil companies, China National Petroleum Corporation (CNPC), successfully applied the ‘going out’ strategy to Africa.29 For example, in 2007, China has benefited from Sudanese oil resources. As much as 52% of China’s equity oil comes from Sudan and 65% of Sudan’s oil exports go to China. China also operates the vast bulk of Sudan’s oil production and has a 50% stake in the nation’s only major refinery in Khartoum.30
Since the 1990s China’s policies toward Africa have been closely linked to the objectives of CNPC. CNPC had invested in 27 major oil companies and natural gas companies in Africa by the end of 2005. China’s oil imports from Africa have increased at an annual rate of 30% since 2005. In 2006, Angola accounted for 50% of China’s oil import from Africa and narrowly overtook Saudi Arabia to become China’s top crude oil supplier.31
Africa is one of the few places in the world where its upstream oil markets are open to investment. For example, the Sudanese and Libyan markets lack major investment in oil exploration and development and are not overcrowded because the U.S. government bars energy investment and trade in those countries due to human rights and terrorism concerns. This has provided China with an opportunity to obtain a unique position in one of the few remaining underdeveloped oil regions in the world.32
Special economic zones: China’s developmental model comes to Africa Keeping the promises made at the 2000 African summit, China has brought Special Economic Zones (SEZs) to selected geographic locations in Africa, such as Nigeria, Uganda and Ethiopia, where investing Chinese companies enjoy favorable economic policies. The purpose of the SEZs is to attract foreign direct investment through special benefits. In most countries around the world SEZs are initiated by the host country, but in Africa’s case China is initiating the SEZs. These SEZs are designed to link markets in Africa to ports and become economic growth nodes. The strategic objectives of SEZs are:
a) Offset the protectionist trade practices against Chinese products;
b) Assist Chinese enterprises to permeate untouched markets and regions;
c) Minimize risk to Chinese firms investing abroad;
d) Promote industrial competitiveness through clustering of enterprises within common industries; and
e) Enjoy tax and investment incentives, customs duty waivers, and work permits approvals for Chinese expatriate labor, and discounted land and services.33
An examination of an SEZ in Africa will show how China initiated SEZs to facilitate China’s extraction of Africa’s natural resources. In 2007 President Hu visited Zambia as part of his eight nation African tour and announced the establishment of an SEZ in Chambishi, the heart of Zambia’s Copperbelt region. The region is a commodity-rich strategic center for the mining industry. With this zone, China sought to secure access to copper and other commodities. The Chinese government has set aside $800 million USD in investment credit for Chinese firms to utilize. The Zambian government set aside a large tract of land in the SEZ for development; however, only Chinese construction firms could perform the construction. The level of job creation was projected at approximately 60,000 positions. A dispute over policy regarding whether Zambian firms are allowed to invest in the SEZ has already developed. A Chinese official indicated that the zone is exclusively for Chinese firms and even Zambian joint ventures are excluded. The dispute will have to someday be resolved between the two governments.34 This SEZ highlights the Chinese favored partnerships that are established by China with African governments. Also this SEZ illustrates bad faith on the part of the Chinese when entering and interpreting these partnership agreements. The major point about SEZs in Africa initiated by China is that they fail to transfer or diffuse technology and know-how to Africans while extracting enormous amounts of raw materials from Africa.
Chinese concessional loans
The Export-Import Bank of China provides concessional loans to developing countries at low interest or in a preferential manner.35 These loans are specifically issued by the China Exim Bank to promote economic development and improve living standards in developing countries.36 Two acts by the Chinese government are required for these types of loans. First, a bilateral framework agreement and a loan agreement are signed. A ceremony takes place for each loan with a high ranking Exim Bank official presiding. Details of the loans are very sparse with more details being released in Chinese than in English, and in China than to the rest of the world. The exact number of concessional loans and to whom they have been given to cannot be verified. However, it appears that potentially 24 African countries have received loans.37 Whether these loans are foreign direct investment or not is an open question. Loans imply that the African country has more control over the loan funds. Whereas foreign direct investment implies China is investing funds as it sees fit with the expectation of a return on investment. What is known about these loans is that these loans have repayment periods and interest rates. The framework agreements contain language that the Chinese firm should “purchase and import from China as much equipment, technology and services as possible”; the host site should have “plentiful local resources, a vast market for goods [and] favorable economic prospects.” Additional language usually states that the project must be “capable of promoting the host country’s economic development,” and that the consent of the host government is required before the project can be executed. The strong commercial objectives contained in the loans show that the Chinese are following the Japanese model of “providing development aid to promote its own domestic export-led growth.” The lack of transparency in China’s concessional loan bolsters the argument that China is in Africa almost solely for economic exploitation purposes.38 In addition, there is fear that China’s loans could create a new debt crisis in Africa.
China’s aid to Africa
This paper asserts that China’s aid to Africa was once for mutual benefit and support, but in the 1970s aid from China changed to a political and economic tool used for China’s own benefit. China’s aid to African countries is quid pro quo for oil and other natural resources. Many observers of China and Africa affairs consider China’s aid as not all about oil, minerals, and resources, but about politics. They see China’s aid in sub-Saharan Africa as based on one factor and that factor is whether the African country follows the “One China Policy.” The map below (Figure 3) summarizes aid distribution in Africa.39 There appears to be a direct correlation between China’s aid and the country’s recognition of the “One China Policy.” The one China principle or policy as it is sometimes known is the political foundation for the establishment and development of China's relations with African countries and regional organizations. The Chinese Government appreciates the fact that the overwhelming majority of African countries abide by the one China principle, refuse to have official relations and contacts with Taiwan and support China's great cause of reunification. China stands ready to establish and develop state-to-state relations with countries that have not yet established diplomatic ties with China on the basis of the one China principle.40
Figure 3. China’s Aid Agreements in Sub-Saharan Africa, 2006-2007
Source: Deborah Brautigam, The Dragon’s Gift (Oxford: Oxford University Press, 2009) 278.
Forecast on the China-Africa Trade and Economic Relationship for the next Ten Years By 2020 this author projects that China will be more heavily invested in Africa and that Africa may appear like a colonial possession of China. Natural resource extraction volume will more than double today’s levels. Africa may fall into a neocolonial relationship exporting resources to China and importing more expensive manufactured goods in return. All these projectionS are based on the rate of increase of China’s trade, aid, and investment in Africa discussed in this paper.
China can avoid this neo-colonial relationship with Africa now and in the future by undertaking the roles, obligations, and responsibilities of a major economic power. China must take greater steps to improve the local economy and support local people’s livelihoods in Africa, especially through local employment. Complaints are already being heard in African countries. In Zambia, Chinese firms invest and setup factories but employ few locals, and South Africa already has fears of ending up in a neocolonial relationship with China where the majority of employment and the consumer goods market are controlled by China.41 According to the Bureau of Statistics of China, 114,000 Chinese work in Africa (including North Africa).42 But the real number is unknown since many Chinese are working in Africa in an unofficial capacity. In the book, The Dragon’s Gift, the author states, “Africans have criticized the Chinese practice of shipping in varying amounts of Chinese labor to work on projects and a robust myth developed around this issue. The ratio of Chinese workers to local workers varies greatly depending on how long a Chinese company has been working in the country, how easy it is to find local skilled workers, and the local country’s policy on work permits.”43 Therefore, criticism of China’s employment practices cannot be stated too generally.
The recent United Nations Trade and Development Report for 2010 addresses African leaders’ concerns over employment and industrial loss to China. The report states that, “more than 20 years of growth, orthodox and macroeconomic policies and policy reforms have limited success in creating the conditions necessary for rapid and sustainable growth, particularly in sub-Saharan Africa…… By the end of the 1990s, the production structure of the subregion was reminiscent of the colonial period.”44
This is the result of Chinese trade, aid, and investment. If China is to avoid the neo colonialist label in Africa it must modify its going out strategy to include more than extraction of oil and other natural resources from Africa, but must focus on social responsibility, particularly holding itself to fair labor standards, environmental standards and transfer technology and “know how” to Africans.
Professor Brautigam provides a different assessment by noting an African diplomat who expressed an assessment that the Chinese are trying to get involved in every sector of the African economy, and that it is the West that is about oil.45 An interview with Professor Brautigam revealed that she foresees a similar China Africa relationship ten years from now but with even greater and more diversified investments.46 She also predicts that the West will not stray from its current position of giving aid with conditions, such as eradication of human rights abuses, implementation of anti-corruption measures, and democratic reforms. According to Professor Brautigam, the West is risk adverse to the types of direct investment China is making. The West’s major focus in Africa will likely continue to be on HIV/AIDS, climate change and food scarcity.47 The West’s level of investment, though significant, is likely to remain at current levels.
Problematic China-Africa partnerships and trade conflicts between Africa and China are already occurring and will increase as the number of projects and loans increase. There are other concerns that Africa has with China, such as environmental degradation and labor disputes.
The China-Africa relationship may not necessarily translate into growth and poverty reduction in the region.48 Huo Jianguo, director of the Chinese Academy of International Trade and Economic Cooperation under the ministry, predicts China-Africa trade will "likely grow by around 20 percent in three to five years".49 The good news is that much of this growth will be in Africa. The bad news is that Africa will experience economic atrophy and lack of job creation if China continues to flood African markets with cheap Chinese consumer goods and hire local labor at minimal levels and wages. China is analogous to a Walmart coming into a community with numerous local small businesses and undercutting the prices of local merchants and driving them out of business. At the same time China will continue to invest more in Africa however China will extract more in concessions that may be hidden in trade, aid, and loan packages. There is a view that China’s grand plan for Africa is to remove its economy from international markets, and acquire commodities at source, negotiating prices with the recipient African government and securing long-term supply contracts.
Conclusion
This paper concludes that China is now in Africa to serve its own best business and political interests and that the label of opportunist is valid. Prior to 1990, China and Africa were like brothers fighting against colonialism, imperialism and injustice. The stronger, richer brother, China, was helping its weaker sibling, Africa, but China’s pressing natural resource needs have changed the character of the relationship. China’s behavior in Africa, however, is slowly showing signs of greater social responsibility as a result of international pressure. For example, China is now taking on the role of being a mediator in Sudan in the Darfur region. Chinese naval patrols have been rescuing European ships in the pirate infested waters off the coast of Somalia.50
It is up to African governments to maximize the endowment of natural resources when entering into business relationships with China. A specific recommendation to African governments and leaders is that they should negotiate better deals and concessions with China guaranteeing better employment for locals including higher wages, development and patronage of local businesses, adherence to labor standards, environmental degradation and internship for African students and young professionals. But the lack of total transparency in business dealings between China and the African countries is hiding corruption and malfeasance on the part of African and Chinese leaders and government officials. China is also guilty of operating in an opaque manner to conceal the true nature of its business dealings in Africa. China initiated SEZs, concessional loans, debt forgiveness, and economic and humanitarian aid in Africa. Poor negotiating on the part of African leaders and government officials and a lack of African unity, allows China to extract natural resources from Africa in the cheapest most productive way to supply its economy.
African leaders and government officials must be politically mindful that for the Chinese Communist Party to stay in power the Chinese economy must continue to grow and the Chinese population must be supplied with the consumer goods it needs and increasingly desires. The magnitude of China’s demand for African natural resources is enormous. This leverage is in the hands of African leaders. Africa’s leaders and government officials must use their enormous leverage to their advantage for the benefit of the people of Africa.
ENDNOTES
1Liu Yumei, “China’s Soft Power and the Development of China-Africa Relations,” China International Studies. Summer (2007): 83.
2 Department of Policy Planning, Ministry of Foreign Affairs, People’s Republic of China, “China Foreign Affairs 2009 Edition” (World Affairs Press) pp. 607-614..
3 George T. Yu, “China’s Africa Policy: South-South Unity and Cooperation” in Lowell Dittmer and George T. Yu, eds., China, the Developing World, and the New Global Dynamic (Boulder: Lynne Rienner Publishers. 2010) 131.
4 Brautigam, Deborah, The Dragon’s Gift (Oxford: Oxford University Press, 2009) 34.
5 Wenran Jiang, “China’s Emerging Strategic Partnerships in Africa” in Robert L. Rotberg, ed., China into Africa: Trade, Aid, and Influence (Washington, DC: Brookings Institution Press, 2008) 50.
6 Darren Kew, Ndubisi Obiorah, and Yusuf Tanko, “’Peaceful Rise’ and Human Rights: China’s Expanding Relations with Nigeria” in Robert L. Rotberg, ed., China into Africa: Trade, Aid, and Influence (Washington, DC: Brookings Institution Press, 2008) 272.
7 Michel Beuret and Serge Michel, China Safari (New York: Nation Books, 2009) 20.
8 This was the first ministerial conference of the Forum on China-Africa Cooperation (FOCAC) where 80 minsters from China and 44 African countries along with representatives of 17 regional and international organizations and people from the business communities of Africa and China were invited. Forum on China-Africa Cooperation. http://www.focac.org/eng/wjjh/hywj/t157833.htm (Accessed Nov 2010)
9 Deborah Brautigam, The Dragon’s Gift (Oxford: Oxford University Press, 2009) 280.
10 Nigeria: FG to Benefit From China’s N750 Billion Investment Fund. (2011 Aug 3). Africa News. Retrieved August 7, 2011, from Lexis Nexis Academic database.
11 Scott Johnson, “China’s African Misadventures,” Newsweek 150 no. 23 (2007): 46-47.
12 National Bureau of Statistics of China, China Commerce Yearbook (Beijing: China Statistics Press, 2009), 175.
13 Harry G. Broadman, “Chinese-African Trade and Investment: The Vanguard South-South Commerce in the Twenty-First Century” in Robert I. Rotberg, ed., China into Africa: Trade, Aid, and Influence (Washington DC: Brookings Institution Press, 2008) 104.
14 FDI stock represents the direct investment position on a historical-cost basis, that is, the amount of investment already in the host country as opposed to the flow of capital into the host country in a given year. Investor Dictionary. http://www.investordictionary.com/definition/fdi-stock (accessed August 7, 2011).
15 Ibid., 105.
16 Ministry of Commerce of the People’s Republic of China Comprehensive Department. http://zhs.mofcom.gov.cn/tongji.shtml (accessed November 25, 2010).
17 Harry G. Broadman, “Chinese-African Trade and Investment: The Vanguard South-South Commerce in the Twenty-First Century” in Robert I. Rotberg, ed., China into Africa: Trade, Aid, and Influence (Washington DC: Brookings Institution Press, 2008) 94.
18 Ibid., 101.
19 Editorial Board of China Commerce Yearbook, China Commerce Yearbook 2009 (Beijing China: The China Commerce and Trade Press, 2009) 250
20 Ibid., 251.
21 Harry G. Broadman, Africa’s Silk Road (Washington, DC: The$International$Bank$for$Reconstruction$and$ Development$/$The$World$Bank,$2007)$120.
22 Geroge T. Yu, China’s Africa Policy: “South-South Unity and Cooperation” in Lowell Dittmer and George T. Yu, eds., China, the Developing World, and the New Global Dynamic (Boulder: Lynne Rienner Publishers. 2010) 140.
23 (Also see Harry G. Broadman, Africa’s Silk Road, (Washington DC: The International Bank for Reconstruction and Development/The World Bank, 2007) 120 for a breakdown Africa’s Top 20 exporters to China and leading exporters in TABLE 2A.4.)
24 Liu Yumei, “China’s Soft Power and the Development of China-Africa Relations,” China International Studies. Summer (2007): 89.
25 Beijing Summit & Third Ministerial Conference of Forum on China-Africa Cooperation, “Action Plan” Adopted at China-Africa Summit, available at http://english.focacsummit.org/documents.htm . (accessed November 24, 2010).
26 Abdoulaye BioTchane and Jian-Ye Wang, “Africa’s Burgeoning Ties with China” Finance and Development 45 no.1 (2008): 2.
27 Hong Zhao, “China’s Oil Venture in Africa,” East Asia. (2007). 24:-400.
28 Ibid., 414.
29 Ibid., 401.
30 Ibid., 401.
31 Ibid.,.402.
32 Ibid., 403.
33 Martyn J. Davies, “Special Economic Zones: China’s Developmental Model Comes to Africa,” in Robert I. Rotberg, ed., China into Africa: Trade, Aid, and Influence (Washington DC: Brookings Institution Press, 2008) 139-141.
34 Ibid., 144.
35 Paul Hubbard, “Chinese Concessional Loans in China into Africa,” in Robert I. Rotberg, ed., China into Africa: Trade, Aid, Influence (Washington DC: Brookings Institution Press, 2008) 217.
36 Deborah Brautigam, The Dragon’s Gift (Oxford: Oxford University Press, 2009) 114.
37 Paul Hubbard, “Chinese Concessional Loans. In China into Africa,” in Robert I. Rotberg,, ed., China Into Africa: Trade, Aid, Influence (Washington DC: Brookings Institution Press, 2008) 223.
38 Ibid., 227.
39 Deborah Brautigam, The Dragon’s Gift (Oxford: Oxford University Press, 2009) 278.
40 Ministry of Foreign Affairs of the People’s Republic of China. China’s African Policy. www.fmprc.gov.cn (accessed August 17, 2011).
41 Deborah Brautigam, The Dragon’s Gift (Oxford: Oxford University Press, 2009) 94.
42 National Bureau of Statistics of China, China Commerce Yearbook (Beijing: China Statistics Press, 2008)
43 Deborah Brautigam, The Dragon’s Gift (Oxford: Oxford University Press, 2009) 156.
44 United Nations Conference on Trade and Development. “Trade and Development Report, 2010,” (2010). 2.
45 Deborah Brautigam, The Dragon’s Gift (Oxford: Oxford University Press, 2009) 279.
46 Deborah Brautigam (Professor, American University School of International Service) in discussion with author on December 1, 2010 at American University in Washington, D.C.
47 Ibid., Second interview on December 6, 2010.
48 Gobind T. Nankani, Regional$Vice$President$for$Africa,$“Foreward” in$Harry$G,$Broadman$ed.,$$Africa’s Silk Road$(Washington$DC:$The$International$Bank$for$Reconstruction$and$Development/The$World$Bank,$2007)$ xixQxx.$
49 China Trade in Services. http://tradeinservices.mofcom.gov.cn/en/a/2010-10-15/85472.shtml. (accessed November 21, 2010)
50 Deborah Brautigam, The Dragon Gift (New York: Oxford University Press, 2009) 281.