In the 1970s, China began to open her previously steel plated borders to the world and all of its influences and interests. This historic move shifted the trajectory of the country for the better, transitioning one of the poorest, least industrialized countries into one of the major world political and economic powers. Foreign industries were attracted to China’s cheap and enormous pool of labor, governmental investment, and their strong centralized government that could push and effectively complete initiatives that a more dispersed market economy or smaller government could not. As China has successfully ridden on 5% or more GDP growth since the market reform, the economy is now changing to be more similar to the economies that once outsourced jobs to their borders, the Asian giant is now wishing to do the same.
As a result, Africa is now seeing an enormous influx of direct foreign investment, spearheaded by the Chinese. As Journalist and expert Howard French describes their opportunism, “Sensing that Africa had been cast aside by the west in the wake of the cold war, Beijing saw the continent as a perfect proving ground for some Chinese companies to cut their teeth into international business.” As of now, a common estimate is one million or so migrants have relocated to a variety of African countries to take advantage of the continent’s opportunity. China has increased their trade with the continent more than twenty-fold since the turn of the century now with an estimated $200 billion in 2012. The bulk of investment today is in a $1 trillion project known as the Belt and Road that is attempting to reinvent the famous trade route, the Silk Road. This initiative that will include 65 countries, over half the world’s population, and would connect China, the Middle East, Africa, and some of Europe through extensive maritime, air, and railway trade routes.
Despite decades of slow growth, wars, exploitation and poor governance, many African nations are beginning to grow and prosper. According to the International Monetary Fund, of the twenty countries projected to grow the fastest between 2013 and 2017, ten are located in sub-Saharan Africa. Much of this growth can be attributed to Chinese investment.
However, this may not turn out to be all good for the unindustrialized nations of Africa. There are many potential consequences of this new phenomena. These possibilities include foreign reliance, pollution, abrupt disinvestment, massive public and private debt, and poor working conditions. This uncertainty but potential for continued African growth and the eventual industrialization of Africa could lead to much of the same for the continent or a boundless future for years to come.
Of course there are several important questions to determine what will happen. What are China’s intentions? Are they purely economic or are there underlying geopolitical motivations here? And how will that affect the lives and economies of Africa countries?
And perhaps the most important question, will this be good for Africa? Can Africa finally climb out of its trap of poverty? Or is this only another form of colonialism and exploitation?
French, Howard W. China’s Second Continent How a Million Migrants Are Building a New Empire in Africa. Vintage Books, 2015.