A purplish red sunbeam was sweeping the thatched roof of the mud huts of the village. Lost in my thoughts, I was admiring that sunrise when a story often told me by my grandpa brought a light smile on my lips. My grandpa said that his father used to tell him that they always had lived their lives before the foreigners came from very far away, then they lived their lives with the foreigners and continued to live their lives after the foreigners left. This story makes me often think of the road being constructed not far away from our village. A road which was said to be an investment of people coming also from a faraway land called China.
I see that, that word ”investment”, indeed, has become the all-encompassing magic word by which everybody and everything swear and which fuels all kind of passions. At the micro-level of enterprises and at macro-level of countries, it is argued that foreign investments and foreign enterprises positively impact on the productivity of domestically-owned firms and the economic growth of host countries but actually there is no clear-cut, unequivocal answer to the question. It is in the background of this debate that I wonder to what extent Chinese investments foster African countries economic development.
You know what? At this moment, Africa is only the third preferred destination of Chinese outward foreign direct investments in the Third World behind Asia and Latin America. When a look is taken at the magnitude of investment flows into China, it becomes evident that China’s investments in Africa are quite modest in size. In 2005 the world total foreign direct investment flows to Africa was US$31 billion of which China’s part to Africa amounted to a mere US$1.6 billion. However the world’s investment flows to China was largely over two times the flow received by Africa and amounted to US$72 billion (UNCTAD 2007) in 2005 and US$124 billion in 2011 against US$42.7 billion for Africa (UNCTAD 2012). China receives more foreign direct investments worldwide than Africa but China’s investments in Africa are marginal and concentrated mainly in resource rich countries and infrastructure projects. These projects in point of fact inflate the turnovers of Chinese enterprises and thus the possibility is created for them to generate profits while they lead to new debt situations for African countries since they have to take new loans to finance the infrastructure projects. Moreover these kinds of projects barely generate foreign exchange reserves for Africa and barely lead to technology transfer already undermined by secretive attitude of foreign enterprises otherwise corporate espionage wouldn’t exist like the historical account of industrial espionage by Harris 1998 shows it.
The investments laid aside, I see that China and Africa trade relations display another picture before me. Despite its spectacularly growth lately, bilateral trade between China and Africa represents less than 4% of the total of Chinese trade worldwide. Besides the fact that African countries’ trade with China shows a deficit of US$10 in 2008 for the former except for few oil and gas exporters their bilateral trade structure shows the same patterns as Africa’s trade with the West (Renard 2011) in that Africa exports natural resources to China and the West and imports for the most part manufactured products, machinery and transport equipment from these latter.
The portrayal laid bare by the investments and trade added to the temporary and poor quality jobs (Alden & Davies 2006: 93-94) the infrastructure projects create, make me think that China’s involvement in Africa will not lead to a substantive economic growth of the continent just like Elu & Price (2010) already pointed out that the opening up of sub-Sahara African markets to the Chinese investments between 1991 and 2004 led neither to economic growth nor did they foster the living standards of African people.
I heard somebody called out my name “Bayi” which pulled me out of my reverie already late in the evening as my village was being wrapped by the evening twilight. Suddenly I realized that just like in the time of great-grandpa, we lived our lives, we live now our lives with the newcomers and we will continue living our lives even after the foreign road constructors are gone.