China in Africa: Rethinking the cliche

Of course, since China’s ‘going out’ policy, its rapidly growing presence in Africa is undeniable. Flying recently from Lubumbashi, a major copper mining city in the DR Congo, little else could be heard in the plane than excited Chinese chatter. The entire Copperbelt area is awash with Chinese mines, logistics companies, doctors, and residential compounds. Zambia’s newest sports stadium in the Ndola, the capital of the Zambian Copperbelt region, proudly sports a large Chinese dragon at its gates. Yes, in resource rich areas as these the Chinese have been making serious inroads, ranging from petty trade to mega-mines. Whether this growing competition with traditional foreign capital streams is beneficial to host countries has been the subject of heated debate and is becoming increasingly political – Zambia’s opposition recently ran on an anti-China campaign, while Zimbabwe with the adoption of its looking east policy actively embraced China.

Similar to my critique of  the one-sided NGO and media reporting in my previous post, this is arguably even more severe in the case of China. Recently, Human Rights Watch (HRW) ran with a report of labor conditions in Zambian mines – concluding that abuses by Chinese companies abound. While these were not my observations in the Copperbelt (we kept hearing how terms of employment were actually improving to prevent fickle mine-workers from leaving for fairer grounds), what bothered me the most was that HRW ignored a quantitative study conducted by the ILO on labor conditions in the Copperbelt (the only one I am aware of – the HRW report was entirely anecdotal). The quantitative evidence from the ILO report suggests that there is no profound differences between Chinese and non-Chinese mining companies. Rather, where most mines made the majority of their workforce redundant at the start of the financial crisis, the Chinese companies were actually hiring people. No doubt, a clear benefit of the Chinese’s reliable access to capital. I cannot imagine that the report’s authors failed to read the ILO report. Rather, I feel it was inconvenient to cite it since it debunked their own message – a message that certainly resonates more with media and its own support base.

Let me now return to the African farmland debate again. Here, ‘respectable’ media companies have tended to paint a picture that Chinese investors are leading the pack of foreign land grabbers. The Associated Press published a story entitled “China farms the world to feed a ravenous economy”; Reuters recently claimed that “wealthier countries in the Middle East and Asia, particularly China, seek new land to plant crops, lacking enough fertile ground to meet their own food needs”; and the Economist went on to say that “China is by far the largest investor, buying or leasing twice as much as anyone else”. Based on what?! I was recently provided a dataset by China’s Ministry of Commerce, which meticulously documented its outwards agricultural FDI. Conclusion? Farmland acquisitions in Africa: comparatively insignificant.

Yesterday I came across a paper by the Center for International Forestry Research (CIFOR) on farmland acquisitions in Africa, which, using verified data sources, came to the same conclusion: “China is not a dominant investor in plantation agriculture in Africa, in contrast to how it is often portrayed”. What I found most ironic from the report’s findings is that Western companies, particularly, from the UK, US, Germany, and Norway were considerably more active than Chinese investors in Africa’s agricultural sector.  This though is not the impression we get from NGO’s and the media that by and large originate from these same countries – the main culprits are the emerging markets. It makes me wonder again, why is the opposite typically portrayed? Ignorance, our love for cliches, sensationalism, politics?

I realize that I am hammering on these points excessively, but how can we optimize the benefits of foreign resource flows in this antagonistic milieu? This is not a conducive environment for dialogue. Let us look beyond the hype and draw conclusions from hard evidence. On the basis of CIFOR’s conclusions, we should rethink the governance of UK and US investment before pointing fingers at the new kids on the block. It’s saddening that that discussion is not being had and our collective shame for thinking in boxes.