Anbound Consulting: Africa will solve China’s problems

On 15 January, the Peking consultancy Anbound released a report that argues that a Chinese “Marshall Plan” for Africa would not only solve China’s problems of an industrial transition (by offshoring labour-intensive low-tech industries and by creating markets for outdated products) but also slow the yuan’s inflation by creating a pool of the currency in Africa.

None of the suggestions are original in themselves — nor is the recommendation for China to radically increase funding for research on Africa and exchanges with African NGOS — but Anbound proposes all this under a comprehensive ten-year, $400bn government- financed plan that would help the expansion of Chinese exports and manufacturing. The last of the 12 recommendations is facilitating family migration in both directions: in China, African migrants are to rejuvenate an aging labour force, while in Africa, Chinese are to bring capital, technology, and kn0w-how. The price label, and of course the advocacy of a comprehensive plan that includes migration, is exactly what suspicious Western critics have always feared: a grand Chinese strategy to take over Africa.

I am not sure what Anbound’s standing in China is. It is very unlikely that the government will take their advice, but I would be curious how widely shared such views are in policy circles.

 

 

Re-reading The Star Raft

Philip Snow’s The Star Raft is not often cited in today’s China-Africa literature, but it remains the most enjoyable volume in it. Snow is an engaging narrator without being superficial; his prose is erudite and unmistakably “posh” (he is the son of a peer, after all!), yet plain. He relies on a wealth of references that are nonetheless discreetly tucked away (few academics dare write in this way any more). At the same time, he has a clear sympathy for China (a very different China than that of today) that always avoids being dogmatic or breathless in the way some commentary today is. And Snow is emphatic about his “overriding concern with human exchange” (p. xvii), as much of today’s literature is not.

I am re-reading the book for a class I am co-teaching, and am struck by the prescience of the preface, written in 1987 — except on the subject of South Africa:

…[R]ight up to the mid-1970s [...] observers predicted the arrival of Chinese warships in the ports of [...] the East African coast. [...] Today, in the late 1980s, it is difficult to remember that the alarm was once so great. [...] Europe and the United States have come to regard [China] as an amiable semi-ally in their confrontation with the Soviet camp. Africa [...] has not found strength or unity, and it has not been able to free itself from Western influence. Most of its states continue to be economically feeble and sustained by constant transfusions of European and American aid. [...] Neither China nor Africa seems likely, in the near future, to disturb the West’s repose.

But the quiet may be misleading. [...] the process of modernization in which [China] is engaged will enable it, in the end, to assert its will far more effectively [...] Africa may not always be weak. The continent may look a very different place, for example, when the apartheid regime in South Africa finally collapses and is replaced by a black-ruled state, rich, powerful and equipped with the nuclear arsenal which the defeated white minority will probably leave behind. And as African countries slowly become more stable and more prosperous, their leaders can be expected to grow increasingly impatient with the continent’s unhappy state of disunity and dependence on Western funds and advice. [...]

We are going to have to accept the fact that the various non-Western peoples are likely to come together with increasing frequency: that they are likely, more and more, to question the disproportionate share of the world’s decision-making power and resources which we — and the Soviet Union — continue to enjoy. [...] From this point of view we shall be well advised to follow with some interest the expansion of contacts between all parts of the Third World. Will Brazil step up its growing economic role in Africa? Will the Arab states live up to the pledges they have made to use their oil wealth to give a political lead to the poorer developing countries? [...]

The Third World peoples will certainly have little hope of destroying our supremacy unless they can make a success of working together — not just as governments or companies but as individuals too.

From exporting labour to exporting standards?

In the discussion of China’s export of high-speed railways in the Chinese media, there has been mention of the importance of building railways and trains to Chinese standards and specifications, as opposed to supplying them to European or American standards. In the context of the Pan-Asian Railway and the so-called Asia-Europe land bridge, a railway network designed to Chinese standards was seen as giving China control over the network itself, which could be a means of controlling, for example, flows of oil.

In a recent article， 中国商报 raised the same point from a trade perspective and linked it to what it deemed the unsustainable nature of Chinese labour exports. In Egypt, for example, the basic wage of a Chinese construction worker is over 5,000 yuan a month plus overtime. Increasingly, the wage differential compared to local labour (though, presumably, this does not hold for the higher-wage countries in Southern Africa) is so great that it that outweighs the benefits of the greater productivity of Chinese workers. Another problem, as the deputy general manager of the overseas department of China Communications Construction Company told the paper, is the “malicious and excessive rights activism” (额以威权、过度维权） of Chinese workers overseas demanding more pay — an intriguing comment considering that little of that activism gets reported not only in Western but also in Chinese media, presumably because the news do not travel outside the overseas corporate compounds.

The article notes that, currently, few overseas projects are designed by Chinese companies (which may be true in communications, but not in hydropower), and that Chinese contractors are ultimately vulnerable to the Western companies that oversee design. “Controlling the technical standards means having leadership rights in the international competition. Whoever controls the standards decides the rules.” The way forward is thus not just to get overseas EPC contracts but to be planners and designers at the level of a regional communication network. Foreign-language translations of 12 Chinese “communications construction standards” have already been published.

The nature of the telecom industry is indeed such that the whoever controls the planning of regional networks holds the trump cards for years to come, both in terms of negotiating with suppliers and strategic control. As in the case of railways, there may indeed be both commercial and — on the part of the Chinese state — geostrategic reasons for striving for such positions.

Korea-Africa Economic Cooperation Conference declaration

The fourth meeting of the Korea-Africa Economic Cooperation(KOAFEC) Ministerial Conference  finished yesterday in Seoul, but its final declaration was circulated two days earlier — in a fashion reminiscent of Chinese conferences.

I don’t recall coming across news about the first, second and third KOAFEC conferences, which goes to show how little international interest there is in South Korea’s activities in Africa — or for that matter in Southeast Asia, despite the fact that in Cambodia, South Korea is a close rival of China in terms of investment volume. The visibility of Korean projects (mostly real estate) and restaurants, karaoke and massage parlours catering to Koreans in Phnom Penh probably surpasses that of their equivalents related to investment from China. The complaints about poor treatment of workers that one hears about Korean employers are close to that of Chinese, and sometimes worse.

The 4th KOAFEC declaration, in terms of its idea, structure, and contents, seems to copy FOCAC, but rather unimpressively and without the rhetoric of mutuality and equal partnership. Infrastructure development, ICT, human resource development, agriculture development, “green growth,” and knowledge sharing are identified as areas of cooperation, but without any specific targets. A short section entitled “The Way Forward” starts with the declaration that the “representatives from African countries expressed gratitute to the people and Government of Korea.”

The one seemingly specific commitment is that

Korea will contribute to the development of African countries by tailoring the Saemaul Movement, a rural development model of Korea, to suit country-specific circumstances and sharing the virtues of diligence, self-help and cooperation (point 25).

Just how this tailoring will happen is unclear, but “sharing the virtues of diligence” is certainly something that no Chinese government programme openly presumes to do (though, of course, many Chinese managers do). The New Community, or Saemaul, campaign (undong) for rural development, was a product of the Park Chung Hee dictatorship in the 1970s and seems like a highly problematic choice for international emulation — despite the Park renaissance taking place in South Korea at the moment.

Opposition to Chinese companies’ labour practices in Zimbabwe

The Brussels-based news and campaign website Equal Times, funded by the International Trade Union Confederation (ITUC), reports that 2,000 Zimbabwean workers employed by Anhui Construction Company (AFECC) in the construction of the new National Defence College with a loan from China Export and Import Bank were fired.

Unions say that those companies can fire and hire without notice, that they can even beat those who try and report abuses.

“The Chinese seem to have immunity to prosecution and arrest” claims Zimbabwe Construction and Allied Trade Union General Secretary, Nicholas Mazarura.

A few months ago a worker was badly attacked by an employer in Highfield, he was bleeding.

The unionists reported the fact to the local Police station but they were told to solve that issue on their own, since they had instructions not to arrest the Chinese who are “friends of the country”. But it is still unclear who gave these instructions.

The article claims that Chinese companies force workers to work overtime and without adequate safety equipment.

“The Chinese bosses accuse us of being lazy, that we do not want to work for our country. But we are forced to work 8 hours during the day plus 6 hours in the evening even if officially they are complying with the Zimbabwean law which contemplates a work day of 8 hours”,  Peter Dube, employed by a company owned by the Chinese Defence Forces and the Zimbabwe Defence Forces, told Equal Times. (…)

“When we accuse them they always say that Zimbabweans must work even for nothing, simply because the Chinese are using their equipment and money to help rebuild Zimbabwe, so they are not supposed to spend on ‘luxuries’ like safety clothing,” a union leader said.

Similar, but more nuanced and much better documented reports have in the last year come out of Zambia (notably a recent Human Rights Watch report) and Angola, the latter focusing in part on the construction industry. Some scholars have attacked them as inaccurate and inherently biased as they focus only on Chinese employers.

This particular report does not seem particularly well researched, and unlike others it has a strident tone. The charge that the workers on the construction of the defence college were fired after the construction ended also seems somewhat surprising, since (a) until now the main charge against Chinese construction projects has tended to be that they do not employ local workers, and (b) how can the company maintain a local labour force if it has finished its activity in the country?

Nonetheless, while for Anhui Construction the need to be flexible with the size of its labour force may be completely obvious, as it cannot predict when and where it will gain another contract, from the perspective of a country in which socialist-style labour protection has a strong tradition and which, unlike elsewhere in Africa, has largely resisted World Bank-style restructuring, these charges are understandable.

Perhaps the most interesting aspect of this report is that in Zimbabwe, too, labour unions seem to be starting to organise against Chinese owners — despite what I think should be the tight links of organised labour to the ruling ZANU.

 

ZTE, Huawei executives sentenced in Algeria

According to a report on the CCTIME website that has since been removed but has been reposted on World-Story, two executives of ZTE and one of Huawei have been sentenced to ten years in prison for bribery that took place in 2003-06 and involved the Algerian telecom authority. The report says that an international arrest warrant has been issued against the three, indicating they were sentenced in absentia.

This is the first case I have come across of Chinese executives being actually sentenced for corruption by a “developing-country” court.

Chinese contractors’ troubles in Africa

Articles reproduced on the TradeMark Southern Africa news aggregator — and forwarded to the China-in-Africa mailing list courtesy of Yoon Jung Park – report that Chinese road construction projects have been suspended in both Botswana and Tanzania because of delays in government payments. In Botswana, the suspension concerns a 115-km stretch being built by Sinohydro. In Tanzania, the Chinese Contractors Association asked the government to pay outstanding debt “so that they can complete the construction of 2,405.6 km trunk roads,” or about 66% of the total being built. ”Johnson Chii, the vice chairman of the Chinese Contractors Association (CCA), said the money is owed since 2009, and has affected their ability to proceed with the work.”  I wonder if some of the contractors are private enterprises: road projects usually go to state enterprises as main contractors, but Chii’s Africanised name makes me curious about the situation in Tanzania.

China’s media investments in Africa stay in the news

Just a few months after the announcement about a new CCTV African service and the opening of Beijing Review‘s Johannesburg bureau, it is China Daily‘s turn to start an African edition, beginning with a Johannesburg office with one in Nairobi planned. CCTV has recently opened a new New York operation, while China Daily — China’s original officially-desoignated foreign-language paper that has recently undergone a big makeover to make it more readable and credible in the eyes of foreign readers, e.g. by printing critical articles and inviting well-known foreigners to publish op-ed pieces — is now distributed as a weekly advertising supplement of the International Herald Tribune in parts of Europe.

All this is perfectly in sync with the Chinese government’s recent “opinion” on expanding Chinese media abroad, which calls for a comprehensive global media network with  coverage that will “centre on developed and neighbouring countries”  but “use developing countries as a[n intial] base.” (It should also  “rely on the Chinese-language overseas market,” one in which investment from China started earlier but is off Western radar screens.

I am usually tired of the widespread view that takes every Chinese investment in Africa as part of a master plan by the Chinese government. But in this case, where the actors are all centrally controlled state enterprises, there is no doubt that their goal is to satisfy government officials (a nd beat each other to it).

The news have triggered a round of commentary by Mohamed Keita in the New York Times, Deborah Brautigam, Li Anshan on Pambazuka, and Bob Wekesa in China Daily itself, among others, andaddressing a variety of issues — is media freedom an absolute good (no, say Li and Wekesa); does it really existin the West or is it in fact just an ideolgical ploy (the latter, sayWekesa andLi); is  China’s goal to help African governments limit media freedom (no, says Brautigam); is that the net result of Chinese investment anyway? (It can be, say I, at least insofar as a Chinese model of a state-financed public television with an overt mission to support the government no longer necessarily looks outdated and embarrassing, and protestations to the contrary are no longer de rigeur. Considering Ethiopia is one of countries with the least free media, the Ethiopian news agency’s plans to launch a multilingual 24-hour news channel is probably inspired by Xinhua ‘s CNT or Russia Today rather than BBC or Al Jazeera.)

For me, the most intriguing question is whether the new cohort of young Chinese journalists around the world — and the young African and other journalists that Chinese money will train and employ — will, quite apart from their employers intentions, pursue their own investigative agendas and generate a more complex picture of the world, in China and elsewhere. The Party line in China is that the current effortis to generate a more balanced view (that is in English publications; Chinese-language  communiques usually frankly speak about a more favourable view of China). I don’t believe that this is really the intention of the Chinese government, but it may nonetheless be an unintended result as more young Chinese begin reporting on the globe.

World Bank and UNDP endorse Chinese special economic zones as model for African poverty alleviation

The International Poverty Reduction Centre of China (IPRCC) and the UN Development Programme (UNDP) co-organised a seminar called “China’s SEZs and Poverty Reduction” in  Shenzhen on 9 January. In his speech at the seminar (link forwarded by Yoon Jung Park to the China-Africa mailing list), Christophe Bahuet, UNDP’s China Country Director, said that “China’s Special Economic Zones … offer many valuable experiences and lessons for other developing countries” and expressed his confidence that “this seminar will lead to a useful exchange on good practices, opportunities and challenges for Special Economic Zones in developing countries.”

This endorsement comes after one by Justin Lin, the World Bank’s senior vice president and chief economist, in the prestigious annual UNU-WIDER lecture to the United Nations University in May last year. Lin, who previously was a professor at Peking University, a member of the National People’s Congress and holder of other offices in China, includid setting up special economic zones among his six recommendations for “developing countries” that he called a “road map” to economic growth. (In the same speech, he likened China to a “leading dragon,” rather than a mere “leading goose” as in the expression “flying geese,” that will be the source of structural transformation in these countries.)

In the past, the United Nations Industrial Development Programme (UNIDO) has endorsed special economic zones in Laos and Cambodia and in Nepal (the latter was specifically related to a Chinese project and later retracted by higher-ups in the organisation). But UNDP has tended to be more “pro-poor” and less sanguine about the growth model these zones represent.

Xinhua and CCTV launch satellite TV in Africa

China Central Television (CCTV) plans to launch an English and Swahili service for Africa, competing with CNC TV, a worldwide network launched by the Xinhua news agency (which does not have a domestic television channel in China).

According to a source quoted by a Kenyan news portal, Jackal News, “CNC TV became the most watched TV station in the Asia continent mostly [for] the Africa stories.” A source that spouts such nonsense is hardly worth much (it is in fact impossible to ascertain from CNC’s website when they have launched their services and where they are available), but Jackal News confidently asserts that “CNC TV is planning to start poaching employees from both local and international stations.”

A South African news site, meanwhile, reported that CCTV “has launched the biggest raid on personnel across Kenyan TV newsrooms … as the station prepares for its launch in December. “Top editors of what will be the Kenyan office and continental satellite studio for the Chinese have already been trained in Beijing and are preparing for what is being described as a ‘transformation of international TV experience.’”

Al-Jazeera is also launching a Swahili service and “poaching” journalists from Kenyan stations.

Semi-official Chinese commentators have long been saying that Western influence on media in Africa (and more recently Burma) is a key obstacle to a better image of China. The expansion of Chinese media overseas has been set by the government as a goal to serve the growth of China’s “soft power.” Li Qiangmin, the current Chinese envoy to the Southeast African Common Market and a senior diplomat, recently said in an interview that Africa’s “misunderstanding” of China is largely because of the “demonisation” in Western media and the absence of Chinese media from the continent. Since the failure of the Southern Media Group, which has a liberal reputation and has recently been attacked by nationalists in China, to buy Newsweek in 2010, however, this expansion has mostly been proceeding in Chinese-language media.

According to a Tanzanian news site, the Chinese government has also “expressed interest to establish an FM radio that will use Chinese and Kiswahili languages as a symbol of friendship with Tanzania.” Li Wei, the Vice-Minister of the State Administration of Radio, Film and Television (SARFT), who made this announcement, said that “the first step we took is to translate a Chinese play into Kiswahili which is called Doudou.”