x Abu Dhabi, UAEFriday 21 July 2017

Is China encountering or exploiting Africa?

China has been pumping billions of dollars into Africa for decades, fuelling economic growth in exchange for access to the continent’s vast natural resources. But is this relationship too one-sided?

China Petroleum Engineering & Construction Corp workers at an oil refinery near Melut, Sudan. Business operations are undertaken by a Sino-Sudanese joint venture. Trevor Snapp / Bloomberg via Getty Images
China Petroleum Engineering & Construction Corp workers at an oil refinery near Melut, Sudan. Business operations are undertaken by a Sino-Sudanese joint venture. Trevor Snapp / Bloomberg via Getty Images

In 1414, Admiral Zheng He, Grand Eunuch of the Three Treasures, set out from the Chinese port of Canton on an extraordinary journey. His naval retinue dwarfed anything the European powers of the time could possibly muster - 62 galleons, more than 100 auxiliary vessels, 868 officers, 26,800 soldiers and sundry courtiers, eunuchs and servants. This great procession, part ceremony, part cultural curiosity, represented a society both technologically superior, and more enlightened, than anything in the West. "About the middle of October 1415," writes Sino-African specialist Philip Snow, "as Henry V's army trudged through the mud of northern France towards Agincourt, a giraffe arrived in Peking."

The giraffe, originally mistaken for a unicorn, suggested that Africa was a place of wonder, a realm of the fantastic - a place to be encountered, rather than exploited. Centuries later, according to Snow, the giraffe would be hailed as a symbol of historical Chinese-African relations by a Beijing newspaper, employed to explain and justify a new era of commercial exchange that started in the mid-1990s.

Since the beginning of this century, the People's Republic of China has pumped billions of dollars into governments and infrastructure across Africa, and reaped billions worth of commodities in exchange. Yet, peering through the official obfuscation, many in Africa are certain there is no quid pro quo.

So, is the current and rapidly expanding relationship between continent and country mutually beneficial? Or is it dangerously one-sided? And are we witnessing the dawn of a new colonialism, a new scramble for Africa?

***

Unsurprisingly, the Chinese authorities bristle at the term "colonialism" when it is applied to its activities in Africa. One of China's great wounds, picked at when necessary, is the razing of Shanghai's Old Summer Palace, the Yuanming-yuan, by a French contingent during the Second Opium War in 1860.

This event is often used as shorthand for the damaging effects of colonial aggression. China understands, in other words, Africa's pain. As the Chinese Communist Party (CCP) leader Liu Shaoqi told the World Federation of Trade Leaders in 1949, "In the Chinese people [Africans] see their own tomorrow, and the Chinese see in them their own yesterday."

Sino-African relations became complicated as the Cold War deepened, and the shifting alliances of the period left the People's Republic open to criticisms of self-interest and proxy war-making. The Sino-Soviet split in the late 1950s led Beijing to define itself in opposition to Washington, Moscow and their respective European allies. Simultaneously, China also saw itself as distinct from the developing world.

The launch in 1949 of its Five Principles of Peaceful Coexistence, based on mutual non-aggression, mutual benefit and equality, looked good from where African liberation movements were sitting. But as the Cold War crawled on, China proved itself less adept than its enemies at understanding and managing the proxy battles unfolding across the continent. "They almost always picked the wrong horse," remarks Dr Martyn Davies, a leading Sino-African expert. The Chinese were expelled from country after country for their troubles, often in favour of the Taiwanese, with which the mainland has long been locked in a diplomatic war.

Nevertheless, the People's Republic had left a footprint. In 1964, following foreign minister Zhou Enlai's much-touted tour of Africa, China provided the continent with 53 per cent of its loans, interest free, to be repaid over an extended period of time.

The condition of that funding was that the money was only valid for the purchase of Chinese technical expertise and equipment. China would eventually offer more than US$2.5 billion (Dh9.2bn) to 25 African states from 1954 to 1977, and transferred over $143 million worth of arms to 15 African nations between 1967 and 1976. Indeed, the construction of the Tanzania-Zambia railway in the early 1970s, at a cost of $405m, is still China's largest international infrastructure project.

A combination of the vast drain of the Cultural Revolution, a moment when China looked ever inward, and eventual rapprochement with the United States during the Nixon era, would slow down this involvement in Africa.

But when Deng Xiaoping reset the nation's economic agenda in 1979, establishing four special economic zones - in Zhuhai, Shantou, Xiamen and most notably Shenzen - and prioritised growth as the country's driving force, or "socialism with Chinese characteristics", Africa once again emerged as an important locus for natural resources.

Premier Zhao Ziyang would later make an 11-country African tour in 1982 and 1983, and while he didn't quite abandon the Five Principles, his focus was on building trading relationships.

This resulted in China taking a different tack from the West's interactions with Africa, which by now insisted on transparency, World Trade Organization compliance, and any number of nuisance clauses before it would sign its aid cheques.

China, on the other hand, did not (and does not) make such impositions. Last year alone, the People's Republic invested $138 billion in Africa. It can and must do this, because it is now the world's second-largest economy and has become a more aggressive advocate of its foreign policy objectives, which include securing enough natural resources to ensure growth.

But, in countries like Namibia, Zambia and Mozambique, the rapaciousness of Chinese business interests coincides neatly with homegrown corruption, and has led to front-page scandals and a growing frisson of xenophobic distaste for Chinese-led initiatives.

The ice-cold pragmatism involved in dealing with China also causes handwringing among the old guard of the liberation movements, especially in South Africa, a country constitutionally ballasted by some of the most glorious human rights rhetoric penned since John Locke.

How, then, does China in Africa play out on the plains and grasslands, in the cities and in the mines? Is there one defining vision directing proceedings from Beijing? Or is the relationship far more amorphous?

***

Liu Guijin, special representative of the Chinese government for African Affairs, is a long-time Africa hand. He first arrived on the continent in the 1970s, running diplomatic pouches between Beijing and African capitals during the heady days of the Cold War. By the time he was installed in Nairobi, in 1980, for his first diplomatic posting, he knew the continent well. "I love Africa," he declares. "Friendly people, friendly place."

Liu could be considered the tip of the official Chinese spear. He has been instrumental in jump-starting the multilateral organisation that most properly exemplifies the new era of codependency. The Forum on China-Africa Cooperation, or FOCAC, was instituted in 1999 to immense consternation from the outside world. But, according to Liu, the initiative came at the behest of the Africans, not his comrades in the CCP.

During a recent meeting in Cape Town, coinciding with the 2011 World Economic Forum, Liu told me that "it was the ambassador of Madagascar that said we need to have a multilateral approach to our relations. In other words, FOCAC was Africa's idea, and we helped to initiate it."

In actuality, most of FOCAC's early impetus came from Beijing. Its initial gathering was held in the Chinese capital in October 1999. Only eight African heads of state turned up for the first forum. In subsequent meetings, alternating every three years between Beijing and an African capital, FOCAC has gained in importance and influence. In 2010, 50 African countries sent representatives, many of them heads of state.

This increase in FOCAC's profile coincides with the massive rise in Chinese economic activity on the continent. Chinese parastatals, semi-private companies and entrepreneurial enterprises are present in almost every African country in a dizzying number of sectors. Massive operators like SinoHydro, builder of the Three Gorges Dam, have around 40 projects on the go in Africa - everything from airport terminals, dams, highways and other large infrastructure development initiatives.

In 1414, Admiral Zheng He, Grand Eunuch of the Three Treasures, set out from the Chinese port of Canton on an extraordinary journey. His naval retinue dwarfed anything the European powers of the time could possibly muster - 62 galleons, more than 100 auxiliary vessels, 868 officers, 26,800 soldiers and sundry courtiers, eunuchs and servants. This great procession, part ceremony, part cultural curiosity, represented a society both technologically superior, and more enlightened, than anything in the West. "About the middle of October 1415," writes Sino-African specialist Philip Snow, "as Henry V's army trudged through the mud of northern France towards Agincourt, a giraffe arrived in Peking."

The giraffe, originally mistaken for a unicorn, suggested that Africa was a place of wonder, a realm of the fantastic - a place to be encountered, rather than exploited. Centuries later, according to Snow, the giraffe would be hailed as a symbol of historical Chinese-African relations by a Beijing newspaper, employed to explain and justify a new era of commercial exchange that started in the mid-1990s.

Since the beginning of this century, the People's Republic of China has pumped billions of dollars into governments and infrastructure across Africa, and reaped billions worth of commodities in exchange. Yet, peering through the official obfuscation, many in Africa are certain there is no quid pro quo.

So, is the current and rapidly expanding relationship between continent and country mutually beneficial? Or is it dangerously one-sided? And are we witnessing the dawn of a new colonialism, a new scramble for Africa?

***

Unsurprisingly, the Chinese authorities bristle at the term "colonialism" when it is applied to its activities in Africa. One of China's great wounds, picked at when necessary, is the razing of Shanghai's Old Summer Palace, the Yuanming-yuan, by a French contingent during the Second Opium War in 1860.

This event is often used as shorthand for the damaging effects of colonial aggression. China understands, in other words, Africa's pain. As the Chinese Communist Party (CCP) leader Liu Shaoqi told the World Federation of Trade Leaders in 1949, "In the Chinese people [Africans] see their own tomorrow, and the Chinese see in them their own yesterday."

Sino-African relations became complicated as the Cold War deepened, and the shifting alliances of the period left the People's Republic open to criticisms of self-interest and proxy war-making. The Sino-Soviet split in the late 1950s led Beijing to define itself in opposition to Washington, Moscow and their respective European allies. Simultaneously, China also saw itself as distinct from the developing world.

The launch in 1949 of its Five Principles of Peaceful Coexistence, based on mutual non-aggression, mutual benefit and equality, looked good from where African liberation movements were sitting. But as the Cold War crawled on, China proved itself less adept than its enemies at understanding and managing the proxy battles unfolding across the continent. "They almost always picked the wrong horse," remarks Dr Martyn Davies, a leading Sino-African expert. The Chinese were expelled from country after country for their troubles, often in favour of the Taiwanese, with which the mainland has long been locked in a diplomatic war.

Nevertheless, the People's Republic had left a footprint. In 1964, following foreign minister Zhou Enlai's much-touted tour of Africa, China provided the continent with 53 per cent of its loans, interest free, to be repaid over an extended period of time.

The condition of that funding was that the money was only valid for the purchase of Chinese technical expertise and equipment. China would eventually offer more than US$2.5 billion (Dh9.2bn) to 25 African states from 1954 to 1977, and transferred over $143 million worth of arms to 15 African nations between 1967 and 1976. Indeed, the construction of the Tanzania-Zambia railway in the early 1970s, at a cost of $405m, is still China's largest international infrastructure project.

A combination of the vast drain of the Cultural Revolution, a moment when China looked ever inward, and eventual rapprochement with the United States during the Nixon era, would slow down this involvement in Africa.

But when Deng Xiaoping reset the nation's economic agenda in 1979, establishing four special economic zones - in Zhuhai, Shantou, Xiamen and most notably Shenzen - and prioritised growth as the country's driving force, or "socialism with Chinese characteristics", Africa once again emerged as an important locus for natural resources.

Premier Zhao Ziyang would later make an 11-country African tour in 1982 and 1983, and while he didn't quite abandon the Five Principles, his focus was on building trading relationships.

This resulted in China taking a different tack from the West's interactions with Africa, which by now insisted on transparency, World Trade Organization compliance, and any number of nuisance clauses before it would sign its aid cheques.

China, on the other hand, did not (and does not) make such impositions. Last year alone, the People's Republic invested $138 billion in Africa. It can and must do this, because it is now the world's second-largest economy and has become a more aggressive advocate of its foreign policy objectives, which include securing enough natural resources to ensure growth.

But, in countries like Namibia, Zambia and Mozambique, the rapaciousness of Chinese business interests coincides neatly with homegrown corruption, and has led to front-page scandals and a growing frisson of xenophobic distaste for Chinese-led initiatives.

The ice-cold pragmatism involved in dealing with China also causes handwringing among the old guard of the liberation movements, especially in South Africa, a country constitutionally ballasted by some of the most glorious human rights rhetoric penned since John Locke.

How, then, does China in Africa play out on the plains and grasslands, in the cities and in the mines? Is there one defining vision directing proceedings from Beijing? Or is the relationship far more amorphous?

***

Liu Guijin, special representative of the Chinese government for African Affairs, is a long-time Africa hand. He first arrived on the continent in the 1970s, running diplomatic pouches between Beijing and African capitals during the heady days of the Cold War. By the time he was installed in Nairobi, in 1980, for his first diplomatic posting, he knew the continent well. "I love Africa," he declares. "Friendly people, friendly place."

Liu could be considered the tip of the official Chinese spear. He has been instrumental in jump-starting the multilateral organisation that most properly exemplifies the new era of codependency. The Forum on China-Africa Cooperation, or FOCAC, was instituted in 1999 to immense consternation from the outside world. But, according to Liu, the initiative came at the behest of the Africans, not his comrades in the CCP.

During a recent meeting in Cape Town, coinciding with the 2011 World Economic Forum, Liu told me that "it was the ambassador of Madagascar that said we need to have a multilateral approach to our relations. In other words, FOCAC was Africa's idea, and we helped to initiate it."

In actuality, most of FOCAC's early impetus came from Beijing. Its initial gathering was held in the Chinese capital in October 1999. Only eight African heads of state turned up for the first forum. In subsequent meetings, alternating every three years between Beijing and an African capital, FOCAC has gained in importance and influence. In 2010, 50 African countries sent representatives, many of them heads of state.

This increase in FOCAC's profile coincides with the massive rise in Chinese economic activity on the continent. Chinese parastatals, semi-private companies and entrepreneurial enterprises are present in almost every African country in a dizzying number of sectors. Massive operators like SinoHydro, builder of the Three Gorges Dam, have around 40 projects on the go in Africa - everything from airport terminals, dams, highways and other large infrastructure development initiatives.

Nowhere is this commercial activity more prevalent than in Namibia, where the local construction industry has been crippled by the government awarding choice contracts to Chinese companies. Meet Karl-Heinz Schultz, co-owner with his brother of one of the country's largest construction companies, and chairman of the powerful Construction Industry Federation. Schultz is currently taking legal action against the Namibian government over a botched tender he maintains his company, Namibia Construction, should have won. The winning bid went to a Chinese firm, which undercut the local, mostly white-owned, companies by more than 20 per cent. During an interview at his comfortable offices in Windhoek's industrial sector, Schultz says that his issue is not that the winning bidder is foreign, but that it can afford to come in so low because it is somehow exempt from local laws.

Schultz has acquired a surprising partner in his protracted action against the government. His name is Bernard Milinga, the general secretary of the Metal and Allied Namibian Workers Union. Milinga's family was subjected to the worst of the white regime - his father, a black activist, was lashed to the bottom of an army helicopter and flown over the Kavango floodplain - and while he does not for a second believe that things in Namibia have declined since independence, or that China's presence in the country doesn't have many advantages, he is adamant that Chinese companies are exploiting local workers.

"The problem we have with the Chinese is that they do not respect our laws," Milinga tells us. "The majority of workers on Chinese construction sites are not [properly] registered. If they are injured, they are not protected."

There is irony here: a former freedom fighter like Milinga, disenchanted with his own government's unwillingness to enforce the very laws that were supposed to protect Namibia's post-independence majority, is compelled to join forces with a rich white industrialist like Schultz, whose wealth has its roots in a system of racial privileges that extend into the colonial past.

On one thing Milinga and Schultz agree: they allege that certain people at the highest levels of the Namibian government (nobody's mentioning names) are being paid handsomely by Chinese government proxies to secure those contracts.

***

All of this notwithstanding, where would Namibia, or Angola, or Mauritius - or anywhere on the continent, for that matter - be without the Chinese? "Nowhere," is the grim assessment of Dr Martyn Davies, CEO of Frontier Advisory, a strategy and research firm.

Davies's trump card is to produce a slide that charts African growth as mirroring Chinese growth. The scale may not be equivalent but, as Davies puts it, "as China goes, so goes Africa."

Indeed, African GDP growth over the past four years has been the only bright spot on an otherwise dismal global economic picture. But GDP doesn't tell the whole story. In Angola, which has become China's primary African trading partner, growth has been as high as 13 per cent per year.

But the disparity between rich and poor in a city like Lusaka, where hotel rooms cost thousands of dollars a night, is vast. African governments seem incapable, or unwilling, to share the spoils of massive wealth with their wider population. And although Angola functions as the "model" African country in terms of the exchange of commodities for infrastructure development, it remains to be seen whether any measurable transfer of skills is occurring. When the oil reserves are fully depleted, what will be left for Angolans? Will they know how to build their own roads?

This idea of what happens next obsesses many Africans, who watch powerless as their natural resources - their forests, fisheries and animal life - deplete at shocking rates.

Take Mozambique, with its 3,000km of unpoliced coastline, which presents a welcome, threat-free theatre for malfeasance. Overwhelmingly, the victims have been the local shark population and stocks are in terminal decline.

From the 1960s to the mid-1990s, according to Eyes on the Horizon, a Mozambique-based NGO, there has been a 92 per cent reduction in the regional shark population. There are two main issues at work here: first, the artisanal fishermen have been incentivised to catch shark because of the astonishing price paid for fins by Chinese traders (as much as $200 per kilogram, which represents more than twice the monthly minimum wage); second, the long-line trawlers, which are either fishing for shark outside the terms of their licence, or fishing illegally altogether.

While Mozambican customs officials have sworn that no licence has been applied for, nor granted, for the export of shark fins, tonnes of the delicacy leave the country every month, going to restaurants that serve the Chinese middle class. As a local chief puts it: "If there is no turtle, no shark - this country is no country." But the Chinese market must be sated.

***

There is a growing feeling across Africa that trade with China represents a unique, once in a generation opportunity. No one imagines that China's year-on-year growth is sustainable, but current economic realities mean that Africa can expect continued interest from the Chinese for at least two decades. Natural resources are certainly a large part of the picture, but it's not inconceivable that by mid-century, the world will be referring to Chad or Somaliland as the factories of the world, taking the place of China's northern provinces.

None of this comes without a price. Bereft of proper management, Africa's forests, fisheries and mines face utter devastation. If growth is not tethered to an increase in skills and education, then Africa will be left with nothing when the boom ends.

And will China continue to turn the other cheek when dealing with such issues as, say, corruption, especially when African nations do not foster transparency when tendering contracts.

What's more, the emergence of a "China model" of government (although China watchers in Africa maintain there is no such thing) - the idea of a highly managed, highly statist, one-party system that subjugates human rights at the altar of endless development and a tinctured form of capitalism - is enormously attractive to many African leaders, who see democracy as a costly inconvenience.

China is not as monolithically united and focused as many imagine it to be. Africa, too, is a region of almost unimaginable ethnic and nationalist diversity. The future of both rests, however, on developing coherent local and regional policies. The variables are staggering. That said, the stakes for Africa are so high - more than one billion people, massive tracts of wealth, an engine for global growth for years to come - that missing this opportunity has ramifications for every last person on the planet. For those on the continent thinking long term, and they are legion, this is an opportunity that must be grasped, and managed. The alternatives are too bleak to consider. While Europe and the United States enter what is likely to be a long period of stagnation, Africa without China cannot grow. Ultimately, it is up to Africans to make sure that growth amounts to something.

Richard Poplak is the author of The Sheikh's Batmobile: In Pursuit of American Pop Culture in the Muslim World. He is currently working on a book about the Chinese influence in Africa.