China and Africa - For better or for worse?

Given China's growing hunger for natural resources and Africa's persistent need for economic aid, the world's most populous country and the globe's poorest continent appear to be nurturing a perfect symbiotic relationship. Or is it?

China has dubbed 2006 the "Year of Africa." Chinese Premier Wen Jiabao just wrapped up an African tour of seven nations, including Egypt, Ghana, Congo, Angola, South Africa, Uganda and Tanzania. Chinese President Hu Jintao visited Nigeria, Kenya and Morocco earlier this year. In addition, Senegalese President Abdoulaye Wade last week became the latest African head of state to make an official visit to China. Beijing will host a China-Africa summit in November.

"Our objective through this cooperation with Africa is to reinforce the capacity of Africa to have its own autonomous development," said Wen during his visit to the Congolese capital Brazzaville. "In cooperating with Africa, China is not looking for selfish gains. We are committed to two principles: equality, benefits both ways, and the non-interference in internal African affairs."

NO STRINGS ATTACHED
 
But human rights groups caution that China's quest for raw materials could undermine respect for human rights and efforts at political reform in Africa.
 
"We do recognise that China is having an adverse effect on human rights in other countries because by dealing with repressive regimes, such as in Sudan, and putting its economic and trading interests ahead of concern for human rights it's allowing these regimes to be provided with resources that they would not otherwise get so easily," said Saria Rees-Roberts, a press officer for London-based Amnesty International.

Whereas Western donors often condition aid on political reform and respect for human rights, China essentially asks only one thing of African nations: that they adhere to its one-China policy. African countries that fail to recognise Taiwan as a part of China are unlikely to benefit from investment and debt relief from Beijing. Likewise, African nations, including those with poor human rights records, can benefit diplomatically.

China, as one of five permanent members on the UN Security Council, has already threatened to veto sanctions against Sudan for what some Western nations call genocide in Sudan's Darfur region. Sudan is a key oil supplier to China.

Nigeria's oil-rich delta has attracted the interest of China.

To help fuel its booming economy, China is investing in Africa like never before.
 
The International Monetary Fund (IMF) estimates that Africa's growth is edging towards six percent, the highest in 30 years, due in part to Chinese investment. Total trade between Africa and China should exceed US $50 billion this year and could reach US $100 billion by 2010, according to the IMF.
 
"On one hand I think it can be very beneficial to Africa - the demand that China is creating for natural resources and products that Africa has," said Walter Kansteiner III, former US assistant secretary of state for African Affairs. "It lifts prices, brings volume up and increases opportunities for increased capital flow and employment opportunities for Africa."

"What is going to be a challenge going forward is to make sure that those increases in supply and demand are matched in an orderly, environmental, and from a human rights point of view, in a proper way," he said.

THIRST FOR FUEL
 
China's biggest appetite is for petroleum. Angola, sub-Saharan Africa's second largest oil producer behind Nigeria, now exports most of its oil to China. Beijing has invested billions in Angola, Nigeria and Sudan to secure drilling rights. China also has high demand for other resources, including cotton. Chinese cotton imports from Benin, Togo, Mali, Cameroon and Burkina Faso, have boomed. Imports from Benin alone increased at least four-fold between 2002 and 2004, according to UN commodity trade statistics.

In return, African markets have been flooded with inexpensive Chinese goods such as kitchen utensils, shoes, electronic goods and clothes. Chinese exports to Nigeria, Africa's most populous nation, have doubled since 2002.

However, some African manufacturers, specifically textile manufacturers, have suffered as a result. The South African Textiles Union says some 60,000 jobs have been lost.

"On the one hand learning to stand up against competition is a good thing because that's the way forward, but on the other hand, because the manufacturing sector is quite weak in Africa, that could easily wipe out young industries," said Andrea Bohnstedt, Africa analyst with Global Insight, a London-based economic and political forecasting company. "And also it's obviously politically unpopular because most African countries have quite high unemployment rates already."

Some are concerned that the influx of cheap Chinese goods, such as shoes, could drive local manufacturers and cobblers out of business.

INVESTMENT IN INFRASTRUCTURE

 In addition to exporting its products to Africa, China has invested heavily in infrastructure such hydroelectric plants, telecommunications, highways, railways and pipelines. Small development contracts are increasingly becoming part of the overall packages that China negotiates with African countries, analysts say.
 
China says it has donated billions of dollars in aid to Africa, including providing malaria medication, setting up agricultural training centres and providing medical and technical personnel to help train Africans. Beijing has cancelled some US $10 billion in bilateral debt to Africa. It also granted the African Union peacekeeping mission in Sudan's Darfur region US $3.5 million in budgetary support and humanitarian aid.
 
Analysts say one reason China is an attractive partner to Africa is because Beijing can move more quickly than sometimes bureaucratic Western nations and aid agencies that demand transparency and respect for political and human rights. When the IMF held up a loan to Angola over oil revenue that went missing, China came up with a US $2 billion loan. After Western firms pulled out of Sudan over human rights abuses, the Chinese helped build an oil pipeline and other infrastructure. When the United States failed to quickly provide boats to help patrol the Niger Delta against militias, Nigeria turned to China.

China has been investing in upgrading African ports in exchange for raw materials to feed its growing economy.

MILITARY SUPPORT

When it comes to military deals, China has come under the scrutiny of human rights groups. Amnesty International said in a report in June that China's sales of military vehicles and weapons to Sudan has aggravated the conflict there and abetted violence and repressive rule.

The report said a UN investigation in August 2005 showed that China had shipped more than 200 military trucks to Sudan. Amnesty also said Chinese weapons were traded in exchange for Liberian timber in contravention of the UN arms embargo on Liberia, helping keep Charles Taylor in power before he flew into exile in August 2003. Amnesty also says China has supplied jet fighters and other military equipment to Zimbabwe.
 
"China's indifference to political controversy is illustrated in its close relationship with Zimbabwe," Princeton Lyman, former ambassador to South Africa and Nigeria, told the US-China Commission in July 2005. "China is the principal supporter of the Mugabe regime, which is reviled in the international community for Mugabe's ruthless crushing of the opposition" among other actions.
 
But some analysts say Western governments have no right to wag fingers at China for supporting Zimbabwe when they invest in countries such as oil-rich Equatorial Guinea, which rights groups say has an equally repressive regime.
 
"If you look at the involvement of Western countries during the Cold War and generally multinational companies and their actions - that's not really a squeaky clean track record either," said Bohnstedt. "What differentiates Chinese firms is that China doesn't have such a strong civil society lobby at home. Therefore, it won't create that kind of public pressure that affects reputations or share prices" to force companies or governments to behave more ethically.
 
Bohnstedt said it remained to be seen whether African governments would develop the technical ability to negotiate complex deals and enforce transparency to ensure that the benefits of Chinese investments are passed on to the broader public.
 
"In the end it really is the responsibility of individual [African] governments to negotiate with these outside forces," she said. "Everybody will try to get away with as much as possible so it's really quite difficult to blame it on somebody who is offering."

cs/ss