More private Chinese investment in African manufacturing

September 23, 2011

Local media in Wenzhou — reputed as China’s capital of private entrepreneurship — report of growing interest in private  investment in African mining as the government has clamped down on small-scale mines in China. The article quotes a lawyer, however, as saying that only 1% of these investments actually succeed. (According to another article, though, 90% of  mines in Katanga Province of Congo-Kinshasa are small Chinese-owned mines with proprietors who sailed in on the tailwinds of state mining companies, each with only some tens of local workers.)

A third article from Wenzhou reports on the expansion of investment in manufacturing in a series of both state-supported and private special manufacturing  zones in Africa, a practice Wenzhounese businessmen are also engaging in in Central America. This practice has grown out of trading: Wang Jianping, for example, started importing shoes to Nigeria in 2001, set up a shoe factory there in 2005 (claimed to be the largest such factory in West Africa, with 600 local workers), and is now setting up a ceramics factory in the industrial zone he established. Nigeria has two more such Wenzhounese zones. Another businessman set up a factory in Egypt, commenting that wages there, at about 1,000 yuan a month, are much lower than in China, and there are export opportunities to the Arab Gulf and Europe.

The article says that the Wenzhou city government assists the expansion of businesses to Africa by organising special trainings and promotions of various African industrial zones. By 2010, city data show an investment of $50 million in Africa.