Africa, Asia-Pacific, Economy & Trade, Headlines

ECONOMY-AFRICA: Admiration and Wariness Towards China

Moyiga Nduru

PRETORIA, Mar 31 2006 (IPS) - Five years ago, Martyn Davies used to give talks on China a couple of times a year, if he was lucky. “Now I get invited twice a week,” he says, highlighting how interest in China’s booming economy has grown.

Davies, who is director of the Centre for Chinese Studies at Stellenbosch University in South Africa’s Western Cape province, has urged African countries to take lessons from China.

The Asian giant will be home to half of all global manufacturing by 2010, he says – and it has managed to lift millions out of poverty over recent years.

Davies was speaking at a one-day conference held in the South African capital of Pretoria, Wednesday. The gathering took place under the theme ‘China’s Growth: Implications for Poverty Reduction in SADC’. (SADC is the 14-member Southern African Development Community.)

China’s economic rise contrasts sharply with the situation in Africa, where poverty has grown in certain countries. According to the World Bank, about half of the continent’s 800 million people live on less than a dollar a day.

“China’s growth is a reality. It’s here to stay,” Naomi Ngwira, a board member of the Southern African Regional Poverty Network (SARPN), told IPS. The non-profit grouping, based in Pretoria, organised Wednesday’s meeting – and has been monitoring trade between China and Southern Africa.

However, she rejected the notion of an open-door policy which would give Chinese firms a free hand in Africa.

“China is interested in Africa. There are resources in Africa that it wants. And, there are markets in Africa it can supply and benefit from,” Ngwira said. “We should invite China (into Africa), but make sure that we work in partnership.”

In the first ten months of 2005, trade between China and Africa rose by 39 percent to over 32 billion dollars, according to Chinese official figures. This was largely as a result of imports of African oil, mainly from Sudan.

According to a SARPN briefing document, the benefits Africa has derived from associating with China include the services of 15,000 medical doctors who were active in 47 African states by the mid-1970s. These medics have treated nearly 180 million cases of HIV/AIDS.

At the end of 2003, 940 Chinese doctors were still working throughout the continent – while over 10,000 agricultural engineers from China were serving in Africa.

Perhaps the most controversial aspect of relations between China and Africa is the increasing export of Chinese textiles to the continent – something that has dealt a blow to South Africa, amongst others.

“This led to the local industries suffering from competition (from) cheap Chinese products and led to massive job losses following closure of some industries,” notes SARPN.

The situation was aggravated by the expiration of the global Multi- Fibre Agreement in January 2005. This agreement, set up in 1974, imposed quotas on textile exports that provided some protection for African producers.

Since its expiration, however, they have found themselves unable to compete with Chinese firms, which have also taken advantage of the new dispensation to target the lucrative U.S. market.

“More than 10 clothing factories in Lesotho closed in 2005, throwing at least 10,000 employees out of work. South Africa’s clothing exports to the United States dropped from 26 million dollars in the first quarter of 2004 to 12 million dollars for the first quarter of 2005,” observed SARPN.

Certain civil society groups view the activities of Chinese firms in Africa in a dim light.

“They don’t care about the welfare of their workers, and they exploit Africa’s resources and disappear,” said Lourenco Inacio Duvane, director of the Rural Association for Mutual Support, a non-governmental organisation based in Mozambique’s north-central Zambezia Province.

He queried whether Chinese companies currently engaged in logging activities in Zambezia had gained the proper authorisation to do so.

“It’s difficult to find Asians applying for concessions. They hide behind (corrupt) politicians and come and cut the forests. The Chinese are not in Zambezia for sustainable development. They tell you clearly that after logging they are leaving,” Duvane told IPS.

“The Chinese economy should not boom at the expense of poorer countries like Mozambique.”

But, Davies blames African governments for failing to put in place effective mechanisms to do business with China.

“To make a country successful you don’t need scapegoats. You get on with the job. Africa should not use China as a scapegoat for its failures,” he says.

Contributing to the discussion, Zhou Yuxiao, counsellor at the Chinese embassy in Pretoria, observed: “These types of debates used to be held in Asia about 20 years ago. But now Asian countries are convinced that China is not a threat, but a country they can benefit from.”

“Likewise, after 20 or 30 years Africans will not see China as a threat.”

Ming Chen, bureau chief for China’s state-run Xinhua News Agency, said South Africa had the potential to attract not only Chinese investors, but also more tourists – providing the country addressed concerns about its crime rate.

“Last year, eight Chinese were killed in South Africa, a country which attracts 50,000 tourists from China every year. If South Africa can tackle crime, I’m sure that 500,000 Chinese tourists will come to South Africa every year,” he noted.

“And, the number will hit 5 million in five years.”

Republish | | Print |

book rich dad poor dad