By Alvin Cheng-Hin Lim
Facts belie America’s critique that China is in Africa for resource extraction only
In his recent state visit to Kenya and Ethiopia—his fourth presidential visit to the African continent—US President Barack Obama argued that Africa’s economic engagement with the US offers the best opportunity for economic empowerment, especially in terms of job creation and capacity building. Echoing a critique of Chinese economic engagement in Africa raised by Secretary of State Hilary Clinton in 2011, President Obama suggested that China’s investments in Africa were essentially extractive and self-serving, and did not offer the long-term benefits that American investment would generate.
However, the facts on the ground belie President Obama’s and Secretary Clinton’s critique that China is only in Africa for resource extraction. In particular, China’s construction of much-needed infrastructure offers its African partners with the “hardware” needed for their long-term economic development. As the New York Times pointedly observed, President Obama’s speech in Ethiopia was delivered at the headquarters of the African Union, a complex that was constructed with Chinese funds, and Ethiopia itself is one of the African countries that has benefited from Chinese infrastructure investment. Indeed, the transportation and energy infrastructure development that is being provided by Chinese projects across Africa is necessary for the continent’s growth. In particular, the expansion of Africa’s electrical grid is necessary for industrialisation efforts across the continent. As Ugandan economist Elly Twineyo explains:
“The Chinese give roads, they give power. That is the form of aid which Africa wants now.”
China’s construction of transportation and energy infrastructure in Africa, along with cities, and trade and industrial zones, has notably changed the urban landscape of its African partners, thereby creating concrete testimonials to the Chinese commitment to African development. This stands in sharp contrast to US economic engagement with the continent. President Obama’s Power Africa initiative, which was launched in 2013, is one of his administration’s key developmental initiatives for Africa, with an ambitious goal of doubling Africa’s access to electricity in five years. However as the New York Times recently noted, Africans have yet to receive any electricity from Power Africa two years into the project. China’s Xinhua news agency highlighted this as an example of Western aid failing to match its rhetoric in Africa. Power Africa’s lack of progress offers a mirror to China’s record of aid and investment in Africa, including the infrastructure megaprojects that have been and are being constructed across the continent, including those that will be constructed under the framework of China’s 21st Century Maritime Silk Road.
Indeed, in contrast to the meager US investments in Africa’s energy infrastructure, China’s investments are objectively far more substantial. In the case of Kenya, Chinese financing in the energy sector—including a 1.2 billion USD financing package from the Industrial and Commercial Bank of China for the construction of a 1,000 megawatt coal-fired power plant, and a separate loan from China’s Export-Import Bank for the construction of a 50 megawatt solar power plant—is 6 times greater than US financing for Kenyan energy projects, and the Chinese financed projects will generate 2.5 times more electricity than the US-financed projects. In Ethiopia, Chinese investments in hydropower and the electrical grid contrast with an absence of investment from the US. Little wonder Ethiopian foreign minister Tedros Adhanom Ghebreyesus observed that the lack of US investment in in his country is “really not as one would expect.” This is especially so given President Obama’s rhetoric of the benefits of US investment.
President Obama’s other claim that Chinese projects in Africa do not improve the human capacity of the locals is also belied by the facts on the ground, as skills transfers from Chinese experts to local workers have been taking place in Chinese infrastructural projects across Africa. In Uganda, for example, local construction workers involved in the construction of the Kampala-Entebbe Expressway have received training to upgrade their skills. Such capacity building is indeed beneficial for the Chinese projects as a properly trained local workforce eliminates or at least reduces the need to incur the substantial costs involved in hiring expatriate experts from China.
Chinese and US engagement in Africa can also be contrasted in the area of trade. Even as China’s economy decelerates to a “new normal” of single-digit growth, Chinese trade with Africa remains strong. In 2014, Sino-African trade reached 220 billion USD, three times the value of US-African trade.
So far in 2015 Chinese trade has already surpassed US trade in key African markets like Nigeria. In the oil and gas sector, Chinese demand has proven to be a lifeline for African producers like Angola, Nigeria, and Equatorial Guinea, especially since the US shale oil revolution has led to a steep decline in US imports of oil from overseas producers like Africa and the Middle East.
In terms of development assistance, Africa received 12 billion USD in loans and development aid from China in 2014, and Chinese financing to Africa is expected to increase to 1 trillion USD by 2025. For those African states which are unable to secure financing at affordable rates from Western financial institutions, China offers low-interest loans or countertrade arrangements that allow these states to pay for development projects with natural resources.
One of the appealing aspects of Chinese aid and investment for its Africa partners is the Chinese government’s principle of non-interference in the partner nation’s internal affairs. This stands in sharp contrast to the West, which instead uses aid as a platform to spread what its governments see as Euro-American best practices to its aid recipients. President Obama’s recent African tour offers a good illustration of this, when he chastised Kenya’s government for its anti-gay discrimination. China’s Xinhua news agency alluded to this juxtaposition with the Chinese non-interference policy when it criticized President Obama for “ignoring cultural differences” and “imposing his values on the continent.” To be sure, the Chinese government takes the challenge of respecting cultural differences seriously, and has disciplined its expatriate citizens for outraging the cultural sensitivities of their host countries, including a Chinese restauranteur in Kenya who had implemented an ill-advised “No Africans after 5 PM” policy.
A second instance of interference occurred when President Obama lectured Africa’s long-serving leaders on the need to respect term limits to their power. This drew a sharp response from leaders like Ugandan President Yoweri Museveni who argued that Africa’s underdevelopment was instead rooted in economic causes like a lack of infrastructure and a common market. This highlighted the work of the Chinese in closing this infrastructure gap without interfering in the internal affairs of their host countries.
Another key difference between Chinese and US enterprises in Africa is in their appetite for risk. China’s comparatively larger risk appetite can be seen in the willingness of its firms to undertake megaprojects in some of the world’s most dangerous regions, for example Pakistan’s Balochistan province, where several Chinese workers at the Gwadar port project have been killed by separatist rebels. This risk appetite can also be seen in China’s engagement with Somalia. Not only has China become one of Somalia’s top donors of development assistance, dating from the outbreak of the Somali civil war in 1991, Chinese firms have also been actively exploring investment opportunities in sectors like oil and gas. As this is one of the frontier markets which Western firms regard as posing too much political risk to safely pursue investment, Somalia appreciates the development assistance and investment provided by China. Further Sino-Somali cooperation can be expected in the future, especially since Somalia’s 3,025 km coast—the longest in Africa—offers a gateway into the African continent for China’s 21st Century Maritime Silk Road development plan. In terms of future prospects for cooperation, the Somali government welcomes the sort of infrastructure megaprojects that Chinese firms have constructed or are constructing elsewhere in Africa, especially since these can kickstart Somalia’s interrupted economic development.
However, the continued insecurity in Somalia continues to pose significant risk, as China was sharply reminded of when one of its citizens, a security official at the Chinese embassy, was recently killed in a car bombing in Mogadishu, the first fatality suffered by a Chinese diplomatic mission since the US bombing of the Chinese embassy in Belgrade in 1999.22 Despite the tragedy, China has reaffirmed that it will not leave Somalia but will instead continue the urgent task of Somalia’s reconstruction.
While Chinese economic engagement in Africa has been very visible, thanks to the scale of its infrastructure projects, the US footprint has been far more secretive, as the most significant US activity on the continent involves military cooperation in the War on Terror. However, inflexibility in certain US policies has paradoxically impaired the fight against terrorism, as can be seen in the case of the Nigerian Islamist terrorist group Boko Haram. Last month the recently-elected Nigerian President Muhammudu Buhari echoed the complaint of the administration of his predecessor Goodluck Jonathan that the US has crippled his country’s fight against Boko Haram with its ban on the supply of much needed heavy weaponry to the Nigerian military. This ban had been put in place in response to reports of human rights violations by the Nigerian security forces, and the US government has noted that such arms supplies may resume following improvements in the Nigerian military’s human rights record.
However, this is a situation where human rights reforms may come at the cost of civilian lives lost to Boko Haram’s intensifying terror campaign. As of this time of writing, over 17,000 people are estimated to have lost their lives in the conflict, and Boko Haram has expanded its attacks beyond Nigeria’s borders into neighbouring Cameroon, Niger, and Chad. Apart from the loss of lives, a serious regional refugee crisis has also resulted from the insurgency. The number of Nigerian refugees at Cameroon’s Minawao refugee camp stands at 44,000 and the number grows daily, and another 30,000 Nigerians are estimated to have sought refuge in Cameroon outside Minawao. In Niger’s impoverished Diffa region, the arrival of over 150,000 refugees has swollen the local population by a third, worsening an already dire humanitarian crisis.
Apart from these Nigerian refugees who have fled across the border, another 1.5 million have become internally displaced refugees within Nigeria. Boko Haram’s recent decision to become the West African affiliate of the Islamic State is a warning that the insurgency could become worse, especially if the Islamic State sends its experienced fighters to provide guidance and support to the West African front of their jihad.
The unhappiness of the current and former Nigerian presidents can be appreciated in the fact that Boko Haram was almost defeated earlier this year by assaults by regional military forces, including the Chadian and Nigerien armies. However, following the Nigerian general elections in March, Boko Haram suddenly resumed, at an intensified pace, its use of older terrorist tactics like suicide bombings.31 While supplies from the US of equipment like armored trucks and ambulances have continued, Nigeria has had to turn to other countries like China for supplies of much-needed weaponry.
President Buhari has also sought to revitalize Nigeria’s domestic arms production capability to reduce its reliance on foreign manufactured weaponry. However it is doubtful if this boost in domestic arms production will happen in time to make an impact in the fight against Boko Haram.
The spreading insecurity caused by Boko Haram is a threat not just to US global security interests and to the stability of the affected states, but also to Chinese economic projects in the region, as Boko Haram’s 2014 kidnapping of Chinese workers in northern Cameroon illustrates.