By David Pilling
Published: December 10 2009 02:00 | Last updated: December 10 2009 02:00
A few years ago, Lukas Lundin, a mining executive, rode his motorbike 8,000 miles from Cairo to Cape Town. His journey, which took just five weeks, meandered through 10 countries, including Sudan, Ethiopia, Malawi, Zambia and Botswana. He was amazed to discover that 85 per cent of the roads he travelled were tarred and of high quality. Many had been built by Chinese companies.
That was 2005. Since then, China's interest in Africa has intensified. In November 2006, Beijing hosted a lavish Sino-African summit at which it promised more than 40 of the continent's leaders a new era of co-operation. Giant elephants and giraffes appeared on hoardings across the capital to mark the occasion.
Beijing has offered more than long-necked symbolism. In 2006 alone, it signed trade deals with African countries worth $60bn. Investments, which often include a resources-for-infrastructure element, have poured in thick and fast. China's stock of foreign direct investment has shot well past $120bn (€81bn, £74bn). In 2006, Angola temporarily overtook Saudi Arabia as China's main supplier of oil, and Africa now accounts for nearly 30 per cent of China's oil imports.
Nor is China's interest limited to oil and minerals. In 2007, Industrial and Commercial Bank of China, the biggest bank in the world by deposits, paid $5.6bn for a fifth of South Africa's Standard Bank. Only last month, at yet another Sino-African jamboree, this one in Egypt, Beijing pledged $10bn of new low-cost loans to Africa. It also promised to eliminate tariffs on 60 per cent of exports and to forgive the debt of several countries. Trade between Africa and China has already risen spectacularly: last year, it jumped 45 per cent to $107bn, a tenfold increase over 2000.
Beijing's engagement with Africa has caused much hand-wringing. Western donors decry Beijing's supposedly scruples-free approach to investing in countries such as Sudan. In some African countries, too, China's growing shadow has provoked anger. Nigerian radicals likened an attempt by the China National Offshore Oil Corporation (CNOOC) to secure 6bn barrels of oil to being attacked by locusts.
Such objections are overdone. They are often disingenuous. China is no philanthropist, but its rise may still represent Africa's best hope of escaping poverty. In the eight years to 2007, before the financial crisis, African countries were growing, on average, by more than 4 per cent a year, far higher than previously. That was thanks partly to better economic management, debt relief and increased capital flows (some from China), but also to the higher commodity prices driven by Chinese demand. Dambisa Moyo, the Zambian economist who riled western donors with her book Dead Aid , says: "China's African role is wider, more sophisticated and more businesslike than any other country's at any time in the postwar period."
Much of the criticism of China's influence rings hollow. As Chinese - and Japanese - officials point out, the west's track record is less than exemplary. European contact with Africa can best be summed up as decades of naked rapaciousness followed by a spectacularly unsuccessful attempt to make amends. During the cold war western governments supported dictators and kleptomaniacs across the continent, from President Mobutu Sese Seko of what was then Zaire to Uganda's murderous British-trained Idi Amin. More recently, in the name of conditionality, benefactors have rammed frequently disastrous economic fads down the throats of hapless recipients. With donors like that, who needs enemies?
China's pragmatism may produce better results. First, an emphasis on infrastructure means that, even if deals are corroded by corruption, at least the recipient country ends up with a road, port or hospital. (OK, or perhaps a soccer stadium.) Much Asian growth, including that of China itself, was predicated on infrastructure. Officials in Tokyo often contrast Japan's own business-oriented approach to south-east Asia - where countries such as Thailand, Malaysia and Indonesia benefited greatly from Japanese trade and investment - with dubious development strategies pushed by the west in Africa.
Second, China's approach is built on trade. Ms Moyo argues that genuine business opportunity is more likely to catalyse development than government-to-government aid that is prone to being siphoned off. Robert Zoellick, president of the World Bank, told the FT there was Chinese interest in helping to create low-cost manufacturing bases in Africa.
Third, and crucially, China is not alone in seeking opportunities on the continent. As well as the west, India, Brazil and Russia are also vying for business. That ought to give resource-rich African countries the ability to haggle for better terms, though of course there is no guarantee that increased funds will not simply line bigger pockets.
It would be wrong to be wide-eyed about China's investments. Some Chinese businesses are rightly condemned for lax safety standards and for shunning African labour. Critics are doubtless right that Chinese money has helped prop up unscrupulous regimes in Khartoum and Harare. Yet China is hardly alone in dealing with thieves and villains. Whatever its side-effects, a scramble to invest in Africa has got to be better than the European precedent; a scramble to carve it up.