2018/12/15

Chinese efforts in Africa

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I'm steadily amazed by how much attention the Chinese get for their efforts in Africa, and by how important they are perceived to be in Africa itself.

Here are some figures about their actual efforts:
"China has denied engaging in “debt trap” diplomacy, and Xi’s offer of more money comes after a pledge of another $60 billion at the previous summit in South Africa three years ago. Xi, addressing leaders at Beijing’s Great Hall of the People, said the new $60 billion will include $15 billion of aid, interest-free loans and concessional loans, a credit line of $20 billion, a $10 billion special fund for China-Africa development, and a $5 billion special fund for imports from Africa. Chinese companies will be encouraged to invest no less than $10 billion in the continent in the next three years, he said. (...) China loaned around $125 billion to the continent from 2000 to 2016, data from the China-Africa Research Initiative at Washington’s Johns Hopkins University School of Advanced International Studies shows."

USD  170 billion over the course of at least 20 years.* Less than USD 9 billion per year. The German annual foreign aid budget is a little higher, and it's much more aid, not mostly lending.

Population density in Africa c. 2000
(c) The Trustees of Columbia University in the City of New York

The difference may be a difference in perception (established aid streams being perceived as self-evident background noise), a difference in style (such as lots more high profile investments done with Chinese money, for example) or it's Western hysteria.

I suspect it's a combination of all three, and the stark difference to German foreign aid appears to be that German foreign aid is actually mostly foreign aid, while the Chinese are rather investing in economic and political relationships. They may do it with access to natural resources in mind, but it's safe to say that this isn't the only motivation.

Africa needs huge investments in infrastructure and education. The old colonial era transportation infrastructure was designed for export (such as rail lines to ports, but not parallel to coasts) and poorly suited for intra-African trade. It's also crumbling or has done so in many places. 

Maybe the largely basic needs-oriented German foreign aid style is not all that smart after all. A decade of projects to educate and assist farmers in some places falls well short of the effect that a Western African rail line a few hundred km inland and parallel to the coast, reaching from Dakar to Kano would have. A similar East African North-South railroad could boost intra-African trade and commerce as well.**

Maybe we Europeans should invest more in North Africa (could supply much solar power, but shouldn't supply more than ~20% of Europe's electrical power needs) and Atlantic Black Africa (railroads, durable paved highways). Such investments don't need to displace traditional foreign aid, and they don't need to be terribly selfish grand strategy policymaking either. It would certainly be within reach with our resources and the benefits*** to us could very well exceed the costs. The very low interest rates signal that there are too few opportunities for (private) investment in Europe itself - it may make sense to open up investment opportunities in Africa. Who knows - maybe Africa could even grab much manufacturing that would otherwise happen in South, Southeast or East Asia?

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Now what would be the relevance regarding defence and freedom?
I suppose it could bring us into conflict with China (though a hot conflict is extremely unlikely), but it could also thwart Chinese efforts to gain footholds in the South Atlantic. The Africans will be wary of loaning military bases to Europeans (except that France maintains a few old ones), and maybe we could -with more political influence and better relations- convince them to refuse Chinese military interests in Atlantic Black Africa.

S O
defence_and_freedom@gmx.de

*: Chinese companies also appear to get contracts for large construction projects that aren't being financed with Chinese money. The Chinese construction companies have cheaper engineers, bring their own workforce (very few people hired locally), and usually deliver the product on budget and on schedule. Such projects are of economic importance, but not really relevant to grand strategy.
**: We've wasted money on Greece's stupid little Cold War with Turkey and on Greek pensions and subsidies instead. 
***: These are difficult to calculate in advance, especially so in the case of non-toll highways.
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8 comments:

  1. Why is such a big deal being made of Chinese aid in Africa? Because it reveals the yanks impotence, and that is surprising, to the yanks themselves. They dont have an answer.

    Its a repeat of the proxy power strategy. They knew what to do when the Soviets played their games in Africa during the cold war. If China had played that game, the US would have known what to do, they would have been far more comfortable with that. But when the Chinese are deploying capital, it causes them a problem because they are too poor to mirror. There have been some discussions about the US publics savings, that they could be leveraged as a national asset. The government would like to be able to direct the investment of 401k's to strategically useful 'partners', I assume with no regard to the safety of that capital or the rate of return. This would be accomplished by deregulating to allow private equity and hedge funds in. Would be funny to watch. I cant see it happening, just a wet dream from policy wonks, so we might see Chinese oil terminals and mining railways getting blown up and 'popular' revolts against the Chinese in Africa instead. Stick to their strengths.

    Couple more points, it is a Chinese stated aim to offshore some Chinese manufacturing to Africa. If we go into another global recession Africa may be sufficiently far along as to sustain a low level of growth that outpaces the developed world (weasel word, 'may') investment in infrastructure would be the first stop. The French seem to have been discussing a strategy where France supplies the security and China provides development capital in nominally French aligned Africa. Extending, I dont imagine deployment of EU or European directed capital would meet hostility from China.

    Its always amusing to hear americans write about Chinese basing in Djibouti as 'a problem', it reveals so much about their thinking.

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    1. "They knew what to do when the Soviets played their games in Africa during the cold war."

      I dispute this. The U.S. did very little in Africa during the Cold War.
      The West mostly failed in its red menace containment in Africa because the West was essentially a bunch of (former) colonial powers, and the Soviets had sided with the inevitably winning decolonialisation movement.
      The French appear to have been much more active in Black Africa than the Americans during the 70's and 80's, at least in regard to non-clandestine activities.

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    2. Thought it was obvious, aparently not. "They dont have an answer." - "They knew what to do when...". Having a plan, enacting a plan, does not mean that that plan will be successful. Someone should have told that to Kissinger. What is different is that this time they don't have a plan they are satisfied with.

      "The West mostly failed in its red menace containment in Africa because...", the West entirely failed in containment because there was no red menance. Proxy power, proxy conflict, third front, whatever. That is all. No ideology. No commie african countries. The same as no element of the Vietnam war was ever to do with political communism. Vietnam is not, and was not intending to become, a communist state.

      We've done this a few times. You seem to lack quite a bit of knowledge when it comes to US involvement around the globe. I dont mean that as an insult, and Im not trying to say I'm more knowledgeable than you in totality.

      Try this, just one facet. What are we talking about? China. Loans. Development. Influence. Subversion, etc... Are you aware of the discussions that have surrounded the World Bank and the IMF over the last 50 years? (Thats rhetorical by the way)

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    3. "red menace" was apparently not obviously snarky enough.

      The West sided against the Soviets in Africa a couple times, and the Soviets kept the upper hand. It was strategic backwater to them, though - and many African leaders preferred to experiment with their versions of collectivism instead of copying Eastern European policies.

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    4. [insert even more snarky response here]
      ...so there

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  2. China and India both have already lots of people with ethnic connections in Africa, who are a factor that can enhance the impact of investments into influence through the number of local agents.
    A Chinese, who travelled Africa, told me of free interactions with no thoughts about hiring bodyguards in regions, where Europeans often act differently.
    Such factors can contribute to Indian and Chinese investments having better local integration and understanding of the human environment that also receives them unlike Europeans, Australians and Americans.
    The Gupta clan with Indian roots was recently considered influential in South African politics. While it's not yet an Indian sphere of influence, India is in a position to possibly become the dominant power in the Indian Ocean region.

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    1. Indians dominate wholesale trade on the Indian Ocean side of East Africa as far as I know, and Lebanese do so on the Atlantic side.

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    2. How is their relationship with and perception of China?
      Lebanon and Israel have global trade networks of which few people know much despite having comparably lots of billionaires in the Western Asia.

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