AFRICANGLOBE – “China’s gift to Africa.” The new headquarters of the African Union, a towering 20-storey building in Addis Ababa, Ethiopia, is so called because China picked up the $200 million tab for the state-of-the-art complex. Ethiopia’s tallest building, completed in December 2011 in time for an AU summit the following month, includes a 2,500-seat conference hall.
The gift prompted Ethiopia’s late Prime Minister Meles Zenawi to refer to Africa’s current economic boom as a “renaissance,” due partly to China’s “amazing re-emergence and its commitments to a win-win partnership with Africa.”
Not all Africans have welcomed China’s gift. West African political commentator Chika Ezeanya considers it an “insult to the AU and to every African that in 2012 a building as symbolic as the AU headquarters is designed, built and maintained by a foreign country.” However, as African leaders savoured the swanky complex in January, they took turns thanking China.
China’s largess to Africa is not new. Previously China had either donated or assisted in building a hospital in Luanda, Angola; a road from Lusaka, Zambia’s capital, to Chirundu in the southeast; stadiums in Sierra Leone and Benin; a sugar mill and a sugarcane farm in Mali; and a water supply project in Mauritania, among other projects.
At the fifth Forum on China-Africa Cooperation, held in Beijing in July 2012, Chinese President Hu Jintao listed yet more, including 100 schools, 30 hospitals, 30 anti-malaria centres and 20 agricultural technology demonstration centres.
African leaders continue to insist that the relationship with China is not a one-way street and that it includes more trade than aid. Indeed, trade between Africa and China was $166 billion in 2011, according to the Economist, a UK weekly. “The good thing about this partnership is that it’s a give and take,” Faida Mitifu, the Democratic Republic of the Congo’s ambassador to the US, told reporters.
Eye On The Pie
What then is China taking? In China Returns to Africa, a collection of essays published by Columbia University Press, the editors Chris Alden, Daniel Large and Ricardo Soares de Oliveira note, “The overarching driver has been the Chinese government’s strategic pursuit of resources and attempts to ensure raw material supplies for growing energy needs within China.” The world’s second-biggest economy currently buys more than one-third of Africa’s oil.
In addition, China’s industries are getting raw materials such as coal from South Africa, iron ore from Gabon, timber from Equatorial Guinea and copper from Zambia.
Chinese industries also require new markets for their products and Africa is a potentially enormous outlet. “China is repositioning itself continuously for the new Africa that’s emerging,” says Kobus van der Wath, founder of Beijing Axis, an international advisory and procurement firm based in Beijing.
Cheap inferior Chinese products have flooded markets in Johannesburg, Luanda, Lagos, Cairo, Dakar and other cities, towns and villages in Africa. Those goods include clothing, jewellery, electronics, building materials and much more. “Even little things like matches, tea bags, children’s toys and bathing soaps are coming from China,” says Bankole Aluwe of Alaba market in Lagos, Nigeria.
African consumers like Chinese products because they are affordable. “Chinese goods are cheaper than those from Europe and North America. In our business, price is very important to customers,” Mr. Aluwe says.
China Africa’s Largest Trading Partner
In an article in This Is Africa, a Financial Times publication, Sven Grimm and Daouda Cissé state that in recent years China’s economy at times has grown at more than 10 per cent a year, while cheap labour has helped reduce production costs — hence cheaper products.
They also note, “The low level of the yuan [the Chinese currency] compared to the other major world trading currencies such as the US dollar, the euro and the yen” attracts African importers.
Already trade between Africa and China has grown at a breathtaking pace. It was $10.5 billion in 2000, $40 billion in 2005 and $166 billion in 2011. China is currently Africa’s largest trading partner, having surpassed the US in 2009.
The Chinese government is eager to cement China’s dominance by burnishing its image through initiatives such as a $20 billion credit to African countries to develop infrastructure and the African Talents Programme, which is intended to train 30,000 Africans in various sectors.
China’s give-and-take relationship also plays out in other forms. Chinese construction firms are acquiring enormous construction contracts. The China Railway Construction Corp. (CRC) signed a $1.5 billion contract in September 2012 to modernize a railway system in western Nigeria.
That same month, China South Locomotive and Rolling Stock Corporation, the largest train manufacturer in China, signed a $400 million deal to supply locomotives to a South African firm, Transnet. In February 2012 the CRC announced projects in Nigeria, Djibouti and Ethiopia worth about $1.5 billion in total.