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November 16, 2018

GEORGE ACHIA: No win-win in Africa-China trade

President Uhuru Kenyatta receives credential from China’s first female ambassador to Kenya, Sun Baohong, at State House in Nairobi, June 5, 2018. /PSCU
President Uhuru Kenyatta receives credential from China’s first female ambassador to Kenya, Sun Baohong, at State House in Nairobi, June 5, 2018. /PSCU

At the recent Forum on China-Africa Cooperation (FOCAC) summit in Beijing, China unveiled a $60 billion (Sh6 trillion) kitty for African countries. The funding is meant to strengthen its relations with African countries.

President Xi Jinping said the money will be spent on projects aligned to China’s Belt and Road Initiative that covers telecommunication, construction of roads, bridges and sea ports, energy and capacity building in Africa. He urged Chinese private companies to invest not less than $10 billion (Sh1 trillion) in Africa in the next three years.

China is now leading in foreign investments in Africa. Many Chinese companies are doing business in Africa, often by entering into local partnerships. These partnerships were seen as opportunities for Africans to gain knowledge from their Chinese counterparts to enhance their technical capacity.

That has not been the case. Despite high expectations placed on the South-South partnerships, many Africa-China joint ventures have failed in knowledge transfer, according to Africa’s Competitiveness in the Global Economy 2018 report. According to the report, African countries are disadvantaged because they are seeking more development and a higher level of expertise from the Chinese.

With increasing economic rapprochement between Africa and China, can Africa count on China to bolster its industrial development? The answer lies on how Africa and China engage in partnerships, which have been manipulated in favour of Chinese firms.

Researchers who have studied Africa-China relations note that it is unlikely that Chinese engagement will significantly benefit Africa in the long term if matters continue in their present form.

For instance, Chinese products are often in direct competition with locally made goods. Hence, rather than creating a win-win situation, as was suggested by Xi during FOCAC 2018, Chinese firms will likely displace local firms while employing imported labour.

The narrative being pushed by China, that their commitment to economic cooperation with Africa is mutually beneficial for technology transfer, is deceitful. It is meant to lure unsuspecting African governments who are keen to secure more loans from China, adding more burden to the already over-taxed citizens.

The report notes that when Africans enter into partnerships with the Chinese, the objective is for Africans to gain knowledge that they can in turn utilise to fast-track local development on their own. For this to happen the partners, particularly the Chinese, must be willing to collaborate and share their knowledge. But the Chinese have often behaved in an opportunistic and uncooperative manner.

This manipulative tendency is common in French-speaking countries, where the Chinese have imposed English as the official language in their contractual engagements but their supervisors refuse to speak English or French, even though it was the joint venture’s official language. The language barrier definitely affects learning and transfer of knowledge.

In addition, the Chinese manipulate contracts through use of words that could have long-lasting impact. For example, a high-ranking government official was quoted as saying that in most contracts he had signed, words such as “The African party must...The Chinese party can”...were common. Once the document arrived in his office, he had no power to change, renegotiate or delay it.

Such contracts leave numerous breaches in favour of the Chinese, who are often the initiators and leaders of the negotiations for establishing joint ventures.

Further, the Chinese have exploited the lack of adequate technical standards in Africa and applied their own norms – a practice that hinders Africans from gaining knowledge and understanding key processes required in implementing projects.

China’s opportunistic attitude is working against Africans. It is high time African countries rethought their approach when engaging with the Chinese to tap into expertise while minimising the exploitation.

Communications and PR professional

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