“Seven Capital Vices” of China in Africa: How Capital Are They Really?

The recent tenth BRICS Summit in Johannesburg and the forthcoming China-Africa Cooperation Summit in Beijing bring the Chinese-African relations to the center of political and academic discussions.  The Chinese advance in Africa since the turn of the century have been spectacular: from a relatively low key player, Beijing has grown into the largest trading partner and into one of the main sources of FDI for African countries, by far surpassing highly volatile US investments.  This trend is hardly surprising – the booming Chinese economy needs more and more energy and raw materials, it is aggressively cultivating foreign markets to sustain its export-led industries. With significant excess capacities, Chinese financial institutions are relentlessly exploring new opportunities to park their huge currency reserves. So, why not Africa? However, the Chinese role in the continent – like any Chinese step beyond its borders – is subject to a scrutiny by foreign politicians and experts, who are not always unbiased and fair to Beijing. Let us go through a standard list of “seven capital vices” or “seven deadly sins”, which they in the West routinely attribute to the Chinese posture in Africa.

The recent tenth BRICS Summit in Johannesburg and the forthcoming China-Africa Cooperation Summit in Beijing bring the Chinese-African relations to the center of political and academic discussions.  The Chinese advance in Africa since the turn of the century have been spectacular: from a relatively low key player, Beijing has grown into the largest trading partner and into one of the main sources of FDI for African countries, by far surpassing highly volatile US investments.  This trend is hardly surprising – the booming Chinese economy needs more and more energy and raw materials, it is aggressively cultivating foreign markets to sustain its export-led industries. With significant excess capacities, Chinese financial institutions are relentlessly exploring new opportunities to park their huge currency reserves. So, why not Africa? However, the Chinese role in the continent – like any Chinese step beyond its borders – is subject to a scrutiny by foreign politicians and experts, who are not always unbiased and fair to Beijing. Let us go through a standard list of “seven capital vices” or “seven deadly sins”, which they in the West routinely attribute to the Chinese posture in Africa.

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1. Preserving a neo-colonial trade structure. China gets oil from Angola, Nigeria, and Sudan, copper from Zambia, cobalt from the Democratic Republic of Congo, and uranium from Namibia. Some Western pundits see in exchanging African commodities for Chinese manufactured goods a clear neo-colonial trade structure, implying economic exploitation of African nations by the greedy Chinese. Indeed, more diversification would not hurt any trade relationship, Chinese-African including. However, if the current trade structure is regarded as detrimental to African suppliers of commodities, then why today the United States is desperately trying to sell more of its own gas and oil to Beijing in exchange for China-made manufactured goods?

2. Favoring commercial investments over technical assistance grants. Western countries continue to accuse China of being too selfish, too business-driven and of paying too little attention to urgent assistance needs in the African continent.  Beijing prefers investments to grants and loans to charitable donations. If you think of such claims, they sound like a paradox: the West accuses communist China of being too ‘capitalist’. Again, nobody would mind Beijing displaying more generosity. However, the grim reality of the last half a century of the African development is that large-scale foreign assistance packages, with some notable exceptions, turn out to be demonstratively inefficient – they breed corruption, abuse of power, develop a sense of dependence and entitlement among receivers. 

3. Practicing “debt book diplomacy”. Beijing allegedly tries to strap African countries with unpayable debts in order to gain political advantage and to guarantee its access to raw materials. This is what they call the Chinese “debt book diplomacy”. Does China indeed extend loans to African countries, which the latter have no capacity to repay? This question is hard to answer – too many independent variables are at play here. Nevertheless, even if in some cases it might be the case, we should keep in mind that Chinese loans and credits in relative terms are very modest compared to IMF and the World Bank that together own more than a third of all the African debt. Long-term practices of these institutions show that they have often poured money into African countries without building up self-reliance, real sustainable development, and industrialization. Their current accumulated leverage in African countries is far stronger than that of China.

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4. Ignoring local labor. They often argue that China is always reluctant to use local labor and usually comes to African countries with its own workers. If Chinese do not employ Africans, Beijing is guilty of an implicit or even explicit racism. Besides, by not investing in local labor, China slows down the economic and social development of its African partners. In reality, common perceptions of the numbers of Chinese workers going to Africa are grossly over-exaggerated – there are only about a quarter of a million of them, mostly coming to Algeria, Angola, Ethiopia, Nigeria, and Kenya. It is really a drop in a bucket compared to the numbers of indigenous Africans serving economic cooperation with China.

5. Disregarding the environment. Conventional wisdom in the West implies that Chinese companies tend to flout environmental standards, practice predatory ways to exploit natural resources, do not care about bio-diversity and often leave behind dead deserts. The Chinese environmental track record is not perfect – neither overseas nor in China proper. Still, to be fair to Beijing, one should note that the overall dynamics of the environment-consciousness there is definitely positive, which is, unfortunately, not the case in some Western capitals. It suffices to mention the Chinese and the US approach to the 2015 Paris Agreement on Climate Change.

6. Neglecting human rights. Western human right activists blame China for economically supporting repressive regimes in African countries and for neglecting human rights problems in the continent. True, Beijing does reject the Western liberal universalism and the Western approach to human rights. The Chinese approach puts social stability and economic development ahead of political freedoms and Western-style democracy. This approach can be questioned. However, the point is that it worked fairly well in China itself and that the Chinese development model is gaining appeal in Africa though Beijing is not deliberately trying to export this model to the African continent.

7. Building a military presence. Many critics of China try to find a long-term geopolitical strategy behind the current Chinese economic activities in Africa. They point their fingers at China’s first military base abroad in Djibouti. At $100 million of military aid to the African Union. At two thousand five hundred Chinese troops, police, and military experts attached to six UN peacekeeping missions in Africa. At the newly established Sino-African Forum for Defense and Security that met in June this year to discuss regional security issues and, no doubt, arms supplies and military training from China. Nevertheless, the Chinese military presence in Africa cannot in any near future match the Western potential. For instance, China currently deploys fewer than one thousand militaries in Djibouti, while the United States, France, Italy and Japan combined have ten times more uniformed personnel there.

The China-African cooperation is a project in the making. Both sides are exploring unchartered waters and they face multiple challenges of conflicting economic priorities, cultural differences, and political disagreements. They make mistakes; they learn how to manage expectations and how to cultivate trust. The ultimate question, however, is very simple. Would Africa be better off, if China decided one day to follow the example of the early Ming dynasty, which after the famous maritime expeditions of the “treasure fleet” led by Admiral  Zheng He had preferred to completely abandon Africa for a couple of centuries? It is hard to imagine anybody, who would give an affirmative answer to this question.

First published in the American Herald Tribune.