News / Africa

Increased China-Africa Trade Raises Questions

A Chinese salesman sells consumer goods in Abidjan, Ivory Coast
A Chinese salesman sells consumer goods in Abidjan, Ivory Coast
Nico Colombant

Growing trade between China and Africa is raising new questions, analysts say, about economic competition and opportunity on the continent.  According to the African Development Bank, China-Africa commerce comprises more than 10 percent of Africa's overall trade.

A recent report by the African Development Bank says African trade with China has steadily grown, while the continent's imports and exports with other markets have mostly declined.

The bank's research director, Leonce Ndikumana, says this was particularly important during the latest economic downturn in the United States and Europe.  

"What we have seen is that when there is a shock to the economies in these regions, Africa gets hit straight in its face," said Ndikumana.  "And diversifying the destination of its exports and the origin of its foreign capital inflows is a good thing for African countries."

China imports mainly oil and other natural resources from Africa, while the continent buys equipment, machinery and inexpensive consumer goods from China.

Some economists are worried that such trade could stifle the development of manufacturing sectors in Africa, while also increasing what often is called the resource curse.  The phrase refers to the paradox that many African regions have highly sought after natural resources, but often experience repeated political violence and extreme poverty.

The senior policy manager for extractive industries at Oxfam America, Ian Gary, says he hopes Chinese companies are aware of the problem.

"Whether you are a Chinese company or a Western company, as we have seen in places like the Niger Delta, you will come into problems with local grievances, conflicts with local communities," said Gary.  "And so I think you will see that Chinese companies will have the same type of learning curve and hopefully will more quickly look at ways that they can support an environment that leads to sustainable development."

But the research director at the African Development Bank, Leonce Ndikumana, says Chinese companies have been more inclined than Western firms to invest in infrastructure such as roads and stadiums in recent years.

He says whatever the challenges, China's interests in Africa will benefit Africans.

"The only way African countries can reduce poverty is by increasing growth and sustaining growth," said Ndikumana.  "So to the extent that the increased trade with China and the increased investment from China to Africa is contributing to growth, this is good news for African countries."



But Oxfam America's Ian Gary points out that Chinese companies receive help from their government to win contracts in Africa.

"Chinese companies are often closely tied to the government and can look at sort of packaged deals and incentives, for example, infrastructure for resource type swaps and other types of incentives, that are not on the table for many of the Western companies," noted Gary.

Other economists say they hope Chinese investors will partner with African entrepreneurs to grow their countries' economies in ways that will benefit more people.  They also say they would like to see Africa expand its economic ties with other parts of the world.

Other countries showing increased interest in Africa include Brazil and South Korea.  Non-oil sectors that are attracting more attention from foreign businesses include agriculture and customer services.

You May Like

Ukraine Purges Interior Ministry Leadership With Pro-Russian Ties

Interior Minister Avakov says 91 people 'in positions of leadership' have been fired, including 8 generals found to have links to past pro-Moscow governments More

US Airlines Point to Additional Problems of any Ebola Travel Ban

Airline officials note that even under travel ban, they may not be able to determine where passenger set out from, as there are no direct flights from Liberia, Guinea or Sierra Leone More

Nigerian President to Seek Another Term

Goodluck Jonathan has faced intense criticism for failing to stop Boko Haram militants More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Talks to Resume on Winter Gas for Ukrainei
X
Al Pessin
October 25, 2014 4:21 PM
Ukrainian and Russian officials will meet again next week in an effort to settle their dispute over natural gas supplies that threatens to leave Ukraine short of heating fuel for the coming winter. VOA’s Al Pessin reports from London the dispute is complex, and has both economic and geopolitical dimensions.
Video

Video Talks to Resume on Winter Gas for Ukraine

Ukrainian and Russian officials will meet again next week in an effort to settle their dispute over natural gas supplies that threatens to leave Ukraine short of heating fuel for the coming winter. VOA’s Al Pessin reports from London the dispute is complex, and has both economic and geopolitical dimensions.
Video

Video Smugglers Offer Cheap Passage From Turkey to Syria

Smugglers in Turkey offer a relatively cheap passage across the border into Syria. Ankara has stepped up efforts to stem the flow of foreign fighters who want to join Islamic State militants fighting for control of the Syrian border city of Kobani. But porous borders and border guards who can be bribed make illegal border crossings quite easy. Zlatica Hoke has more.
Video

Video China Political Meeting Seeks to Improve Rule of Law

China’s communist leaders will host a top level political meeting this week, called the Fourth Plenum, and for the first time in the party’s history, rule of law will be a key item on the agenda. Analysts and Chinese media reports say the meetings could see the approval of long-awaited measures aimed at giving courts more independence and include steps to enhance an already aggressive and high-reaching anti-corruption drive. VOA’s Bill Ide has more from Beijing.
Video

Video After Decades of Pressure, Luxembourg Drops Bank Secrecy Rules

European Union finance ministers have reached a breakthrough agreement that will make it more difficult for tax cheats to hide their money. The new legislation, which had been blocked for years by countries with a reputation as tax havens, was approved last week after Luxembourg and Austria agreed to lift their vetoes. But as Mil Arcega reports, it doesn’t mean tax cheats have run out of places to keep their money hidden.
Video

Video Kobani Refugees Welcome, Turkey Criticizes, US Airdrop

Residents of Kobani in northern Syria have welcomed the airdrop of weapons, ammunition and medicine to Kurdish militia who are resisting the seizure of their city by Islamic State militants. The Turkish government, however, has criticized the operation. VOA’s Scott Bobb reports from southeastern Turkey, across the border from Kobani.
Video

Video US ‘Death Cafes’ Put Focus on the Finale

In contemporary America, death usually is a topic to be avoided. But the growing “death café” movement encourages people to discuss their fears and desires about their final moments. VOA’s Jerome Socolovsky reports.
Video

Video Ebola Orphanage Opens in Sierra Leone

Sierra Leone's first Ebola orphanage has opened in the Kailahun district. Hundreds of children orphaned since the beginning of the Ebola outbreak face stigma and rejection with nobody to care for them. Adam Bailes reports for VOA about a new interim care center that's aimed at helping the growing number of children affected by Ebola.

All About America

AppleAndroid