After a decade-long resource push into Africa, the Chinese government is still struggling with an image problem.
The accusations come thick and fast: Chinese foremen overwork or abuse their labourers, immigrants are guilty of poaching and illegal mining, and merchants are undercutting local traders as they flood markets with cheap goods. As economic and diplomatic ties between China and Africa go from strength to strength, something’s still missing in the realm of cross-cultural relations. Continue reading »
China is not known for its moral scruples or sensitivity when it comes to investing in dangerous countries. It may help to build schools, hospitals and railways as a quid pro quo for getting access, but what it mostly seems to want is to get in and out with its raw materials and without interfering in local politics.
Erik Prince and China could be made for each other. The former Navy Seal who founded the hugely controversial private security group Blackwater is pitching to run logistics for Chinese mining and energy companies in Africa. Continue reading »
The IMF may have outlined the risks to sub-Saharan Africa from tighter monetary policy in the US and other shocks (read the FT’s Javier Blas for the full story) – but as the report makes clear, it’s not just the US that has an impact on Africa’s fortunes.
There’s China too, of course. In a section titled Africa’s Rising Exposure to China: How Large Are Spillovers through Trade?, the Fund looks to quantify and group the countries most exposed to a China slowdown. Continue reading »
By Andrew Brown of Emerging Capital Partners
Last week the International Monetary Fund (IMF) predicted a further drop in China’s growth to 7.3 per cent in 2014, the lowest figure that the country has experienced in the last 23 years.
China’s continued economic slowdown as it shifts from export-led to consumer-driven growth has prompted speculation as to the knock-on effect on economies that have benefited from China’s rise. Debate has centred on whether many frontier economies, including those of sub-Saharan Africa, are reliant on continued rapid growth in China’s demand for commodities to drive their own economic development. Continue reading »
When it comes to natural resources in Africa, coverage tends to focus on the problematic (see Rio in Mozambique), the awkward relationships (see China), the political risk (see Congo) and the collapse in labour relations (see South Africa).
But despite the setbacks, Africa still has vast untapped reserves and lots of potential. So what should investors look out for in the next few years? Research from Ecobank has identified six themes. Continue reading »
Much has been written about China in Africa – a relationship that has been described as neo-colonial as China’s appetite for African resources has boomed and China has embarked on landmark projects such as the headquarters of the African Union in Addis Ababa (pictured left).
But quantifying the China-in-Africa story has been hard. There are official projects, aid donations, gifts, credit lines and more. Adding all that up is tricky – but a new database from AidData shows just how vast and sprawling Chinese investment in Africa has become. Chart of the week has run the numbers. Continue reading »
The China-Africa debate is never far away. Lamido Sanusi, governor of Nigeria’s central bank, recently wrote in the FT of a whiff of colonialism. Much has been said about the two countries’ unequal relationship, based on China’s supposedly insatiable desire for African raw materials and for control of its mining assets.
But perhaps a bigger problem is not China’s dominance but China’s slowdown. What happens when the country doesn’t want so many of Africa’s exports? That moment may be coming sooner than you think. Continue reading »
The railway linking Lagos, Nigeria’s commercial capital, to Kano, the country’s second largest city, has reopened after more than 10 years thanks to Chinese loans and investment. Xan Rice, the FT’s West Africa correspondent, makes the 31-hour journey and asks whether the train line is a sign of progress in Africa’s second biggest economy.
Leading Africans are finally getting tough with China. They are becoming increasingly concerned that economic engagement with China comes at a price – and that the price is sometimes too high.
The latest to speak out is Lamido Sanusi, Nigeria’s central bank governor, who warned on Monday in an FT guest column that China takes Africa’s primary goods and sells manufactured ones and says: “This was also the essence of colonialism.”
He could hardly be clearer. Continue reading »
Zambia announced on Wednesday that it had revoked the licences for a controversial Chinese-owned coal mine in the south of the country in response to violations of safety and environmental laws and a failure to pay mineral royalties.
Mining minister Yamfwa Mukanga said the government had taken over the mines and would operate them “until a suitable investor is found”. The decision highlights the sometimes troubled relationship between China and Zambia.
Continue reading »
Is the honeymoon of the unofficial Africa-China wedding over?
Last week, the Nigerian Central Bank voiced its discontent about the unfavorable trade balance with China – and made it clear Nigeria was already looking elsewhere for friendship (and maybe more). Continue reading »
To date, the story of China’s growing presence in Africa has been mostly narrated by western media, African newspapers, and a universe of blogs, websites and social media outlets. Often, it is framed in the context of land-grabbing, resource-snatching, neocolonialism and invasion.
So perhaps a different perspective might be provided by China Daily? The state-run paper is launching a weekly Africa edition, and is keen to put its side of the story. Continue reading »
When it comes to loans, Africa has a clear preference: lots from China, a little less from the World Bank please.
According to data compiled by rating agency Fitch, loans from China’s Exim bank to Africa in 2011 were double that of the World Bank, cementing a trend which started around 2005. Continue reading »
When it comes to trade, sub-Sarahan Africa is highly exposed to the eurozone, isn’t it? You would think so, given the warnings from the IMF to that effect.
But park your assumptions for one minute. Yes, any eurozone slowdown hurts African trade. But not by as much as a slowdown from other parts of the world, and the eurozone dependency is falling. Continue reading »
The internationalisation of the renminbi is reaching deep into Africa.
This month the central banks of Nigeria and Tanzania joined their counterparts on other continents in adding renminbi to their reserves. Together they bought bonds worth Rmb 500m in a Rmb2.5bn three-year issue from the China Development Bank, the Chinese state development lender. Continue reading »