China’s Dangerous Game: Resource Investment and the Future of Africa
It was an important day for Angola, June 20th, 2006. Amid the diplomatic pomp and handshakes of an official visit, Chinese Premier Wen Jiabao opened the Luanda General Hospital and had his picture taken peering into a microscope surrounded by officials in suits and medics in white smocks. The capital’s General Hospital, a sprawling eighty-thousand square meter complex, was constructed with Chinese funds and meant to symbolize the growing partnership between Beijing and Angola, a symbol replicated across the African continent in countless roads, bridges, and other infrastructure projects funded by Chinese investments.
Premier Wen stayed only 24 hours but the hospital remained; a physical reminder of Sino-African trust and cooperation. Four years later the hospital was in imminent danger of collapse. Deep cracks ran through its walls, bricks crumbled under the structure’s weight. Personnel and 150 patients were evacuated with some forced to live in tents on the hospital grounds. Beijing dispatched an investigatory team and their findings concluded that faulty Angolan surveys resulted in flawed Chinese designs, a diagnosis that has come to symbolize the greater Sino-African relationship: great ambitions built on uncertain ground. China has a vested interest in developing Africa’s infrastructure through loans underwritten by the continent’s vast natural wealth and it is clear why.
China’s manufacturing economy requires immense resources, resources Africa can provide from Angola’s oil to Zambia’s mineral wealth, and Beijing has seeded billions of dollars across the economically fertile continent. Six billion for the Democratic Republic of Congo, $8.4 billion to Nigeria, the Wall Street Journal reports $16 billion invested in Ghana, and last July Chinese President Hu Jintao promised an additional $20 billion for agriculture and infrastructure loans.
Massive investments across the continent underscores the fact China sees its future economy closely tied to Africa and this future looks bright as the IMF forecasts seven of the ten fastest growing economies will be African by 2015. Now China is Africa’s largest single trading partner and in 2011 bilateral trade crested $166 billion, up a staggering 33 percent from the year before.
Significantly, $93 billion were African exports of mostly natural resources and agricultural goods while the remaining $73 billion consisted of manufactured goods imported from China. Rather than just an extraction site for China’s resource needs, Beijing sees Africa as a highly significant market for Chinese products.
On the surface China’s resource-for-infrastructure investments are presented in simple terms: in exchange for access to African resources, Beijing underwrites major infrastructure projects necessary for partner countries’ development and economic growth. These resource deals are ostensibly built upon China’s principle of “equality and mutual benefit, cooperation and win-win, and common development” as outlined by the Forum on Africa-China Cooperation. While this ‘win-win’ economic cooperation has the very real capacity to significantly increase African development and benefit the lives and fortunes of millions across the continent, China’s massive investments have attracted criticism raising deep concerns about just how beneficial their policies will be for Africans.
In signing deals that trade African resources for easy loans and much-needed infrastructure Beijing must be seen as a fair player in regional development and not, as some critics suggest, a neocolonial power colluding with kleptocratic governments. China’s brand name is its most important calling card in regional development, embraced by many as a business-based alternative to traditional Western aid, but in recent years China’s actions on African soil have questioned Beijing’s ‘win-win’ rhetoric and ultimate aims on the continent.
One of the many criticisms leveled at Chinese resources-for-infrastructure deals is that their infrastructure projects are of shoddy quality, poorly constructed, and not long to last. Luanda’s General Hospital is no isolated event as The Economist has reported Chinese-built roads in Zambia washed away by rains and Al Jazeera similarly revealed substandard Chinese construction in Angola. In Ghana, the $5.7 million Koroidua bypass built by the China Water and Electric Company became immotorable just a year after it opened due to craters and gullies. At the University of Liberia’s Fendell Campus, a $30 million gift from China, the administration building showed signs of collapse after being open for only two years. Perhaps there is no greater symbol of Chinese construction challenges on the continent than the new African Union complex in Addis Ababa which opened this January. Built by local labor under Chinese managers, the African Union’s $200 million headquarters was hailed as China’s gift to Africa and a sign of progressive partnership. Only six months later the Christian Science Monitor reported photographs of the building’s leaking ceiling making the rounds on Facebook.
A more troubling aspect of China’s resources-for-infrastructure deals is its willingness to align with authoritarian leaders and this is exemplified by its close relationship with Zimbabwe’s President Robert Mugabe. In 2008 the New York Times reported dockworkers in South Africa refusing to unload a Chinese cargo ship carrying three million rounds of ammunition, several thousand mortar rounds with mortar tubes, and 1,500 rocket-propelled grenades bound for Zimbabwe. In response to international attention, China’s Foreign Ministry responded to Reuters stating “China has always had a prudent and responsible attitude toward arms sales. One of the most important principles is not to interfere in the internal affairs of other countries.” While Beijing’s stated policy is to not interfere in Zimbabwe’s affairs their actions in support of Mugabe’s internationally criticized regime suggest otherwise.
Last year the China Development Bank announced they could invest up to $10 billion dollars in Zimbabwe’s mining and agricultural sectors and this year President Mugabe opened a new $98 million military academy built by Chinese contractors with the project’s cost to be repaid in Zimbabwean diamonds. For years China has been mining partners with a Zimbabwe state-run firm in the controversial Marange diamond fields where, in 2008, Mugabe’s helicopter gunships killed some 200 diamond panners and many more were subjected to torture, rape, and dog attacks. Now, with perhaps $10 billion to invest and Chinese diamond mines currently operating in eastern Zimbabwe, Beijing’s policy to ‘not interfere with internal affairs’ seems to ring as hollow as their support for Mugabe is resonant.
While China’s controversial relationship with Mugabe’s repressive regime illustrates one chief criticism of China’s resources-for-infrastructure deals, another concern dogs their continental ambitions: labor abuses. China’s mining interests in Africa are significant and in 2010 Zambia earned $2.2 billion from bilateral copper exports but not without controversy. Human Rights Watch reported Chinese managers making copper miners work 12-18 hour shifts up to 365 days a year in fume-filled tunnels without providing drinking water or safety equipment. Other alleged abuses include beating workers with hammers and shovels and paying most workers less than $200 per month. In 2010 similar pay and working conditions at the Chinese owned Collum Coal Mine provoked protests from Zambian miners; their Chinese managers responded by firing guns into the crowd and injuring twelve. Two managers were accused of attempted murder but these charges were later dropped. A year later another clash at the same mine left one Chinese manager dead and two others wounded.
A sobering example of growing tension in Sino-African relations is documented in a US State Department Human Rights Report involving the China Henan International Cooperation Group in Mozambique. After beginning work on a new water supply system complaints arose about labor and safety violations but the greatest insult were Mozambican workers wearing badges bearing “escravo,” the Portuguese word for ‘slave.’ Resources-for-infrastructure deals hold the potential to dramatically develop African economies and with immense capital reserves China’s strategic investments can potentially improve the livelihoods of millions across the continent, but for Beijing to be a lasting and beneficial partner its brand name must be above suspicions of neocolonialism.
Substandard infrastructure projects, cozy relationships with repressive governments, and abusive labor practices are a few of the many accusations facing Chinese investment practices and undermine the real development of many African economies. Regarding China’s loan pledge of $20 billion, last July South African President Jacob Zuma struck a somber tone at the China-Africa Forum, stating “Africa’s commitment to China’s development has been demonstrated by supply of raw materials, other products, and technology transfer. This trade pattern is unsustainable in the long term. Africa’s past economic experience with Europe dictates a need to be cautious when entering into partnerships with other economies.”
While China is quick to refute critics labeling them neocolonialists the moral high ground of history is reached by slippery slopes and when signing infrastructure loans for Africa’s natural wealth Beijing would be well to remember the roads France paved through Vietnam, the Dutch-built ports of Indonesia, and how Britain laid their rails across the spine of India.