Thursday, March 30, 2006

China's move into Africa

Rory Carroll, in The Guardian, 28 March 2006, wrote about China's move into Africa

http://www.guardian.co.uk/china/story/0,,1741082,00.html

Carroll points out that a vast number of Chinese diplomats, technicians and entrepreneurs have entered Africa.

Carroll refers to:

Chinese lumberjacks in the Central African Republic, Chinese textile merchants in Lesotho, Chinese tourists in Zimbabwe, Chinese road builders in Ethiopia, Chinese newspapers in South Africa, Chinese geologists in Sudan, Chinese channels on African satellite television...

China is chasing France and the US in the race to become the continent's biggest commercial partner.

China needs Africa's oil and minerals.

Carroll writes:

Now there is potential for a great irony: that rapacious Chinese capitalists will benefit Africa more than western do-gooders.

However, Carroll refers to certain problems:

1. The Chinese are accused of flouting laws and regulations - on health and safety, environmental protection, tax, social security.

2. The Chinese are accused of supporting some of Africa's worst governments.

In Zambia some people working for the Chinese describe their $45 monthly wage as exploitation.

"The Chinese are not good people. They do not pay us well. We do this only because there is no other work," says one worker.

"They make me work seven days a week, pay me $30 a month and if I miss a day, deduct some of my wages," says another worker.

Some Chinese firms allegedly dodge tax and flout rules on immigration and health and safety.

According to Carroll, African governments see China as a model of modernisation and development as well as a source of enterprise.

...University students in Zimbabwe have been told to learn Mandarin. Kenya has allowed the state-run China Radio International to run an FM transmitter which broadcasts in Chinese, English and Kiswahili. The Central African Republic has granted the country's biggest timber export licence to a Hong Kong company. Burundi has embraced Chinese nickel miners. Uganda has asked a Chinese firm to rehabilitate a ceremonial complex in Entebbe for a Commonwealth summit next year.

South Africa has the largest Chinese population, estimated at 160,000.

Carroll refers to two worries:

1. Chinese imports - worth $14bn in 2004, up more than a third from 2003 - are swamping local markets and driving many African manufacturers out of business.

2. The other worry is that efforts to bolster human rights and democracy across the continent are being eroded by the Chinese involvement.

Carroll lists examples:

When the International Monetary Fund held up a loan to Angola over misused oil revenue, China stepped in with a $2bn loan.

After western firms pulled out of Sudan over its human rights abuses and terrorist links, the Chinese National Petroleum Corporation helped build a 1,500km oil pipeline as well as bridges, roads and factories.

The United Nations security council threatened sanctions against Sudan over massacres in Darfur, only to be vetoed by Beijing. When America balked at supplying Nigeria's trigger-happy military, China offered dozens of patrol boats.

Carroll relates:

The single greatest Chinese interest in Africa is oil.

China 's economy is thirsty; by 2030 it will need to import 60% of its oil.

China already swallows most of Sudan's production, is on its way to becoming Angola's biggest client and is playing catch-up in Nigeria, paying $2.3bn for a 45% share of an offshore block.



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