It is important for us to understand what we mean by saying China’s Growth Model is shifting. Over the last couple of years the model has become less resource intensive as the economy moves into middle income status. As its economy grows and prosperity spreads, it has become more consumer and services driven. The growth trajectory has been slowing down and mid April 2013 reports show a growth rate of 7.7% down from the projected rate of 7.9%. The traditional above 10% growth rates are now history.

All these changes require strategic positioning of Africa’s relations with China. What is Africa’s optimum response vis-à-vis this new reality? Furthermore there is a new government in China led by President Xi Jinping and Premier Li Keqiang with a particular emphasis on the social and personal aspects of economic success encapsulated in the notion of the China Dream which seeks to reimagine prosperity and reshape consumerism in China. The goal is to catalyze a new aspirational lifestyle that is innately sustainable for the emergent middle class in China. These new developments have implications for China’s commercial relations with Africa.

However, as we discuss how African States need to respond to China’s shifting growth model, it must be acknowledged that African countries have not effectively engaged the Chinese, even before the model started to change. We need to pick up lessons on what has characterized the Africa-China relationships so far, and then use that as basis to explore future partnerships as the Chinese economy changes.

There have been two types or classes of critiques of the Africa-China economic relations. The first category is what can be termed Western inspired criticisms and the second set consists of genuine grievances leveled by the Africans themselves. Before we delve into a detailed assessment of these challenges, the key theme and central message in this treatise must be laid out up-front. African countries must NOT BLAME China or any other foreign power or institution for their problems. We must assume responsibility for our own circumstances, take charge of our economies and create sustainable solutions to impediments that confront us.

By getting heavily involved in Africa economically, the Chinese have broken the Western hold on Africa-World trade. Historically, Europe and the United States of America have always considered Africa their area of political and economic influence. However, the entry of China has meant competition for them, and they are not exactly amused. In fact they are getting clearly out-competed by the Chinese. This has led to baseless and self-serving Western inspired attacks on the Chinese in Africa. The United States policy makers have been in the forefront, feeding into, and abated by, naïve Africans. The charges include that the Chinese are; indifferent to governance issues, supporting dictators in Africa, plundering of Africa’s natural resources in a new colonialism, not adding value African commodities, bringing labour from China, and are engaged in unfair and poor labour practices.

While some of these accusations merit attention, the motivation, history and current practices of their Western sponsors make them hollow. Western countries and their investors have never encouraged beneficiation or value addition in Africa.  They brought slavery, colonialism, imperialism and now neo-colonialism to Africa. Furthermore, the hypocrisy on the governance matter is striking. When Western nations and their institutions go out to trade and invest, they do not insist on democracy, good governance or human rights pre-conditions. Illustrative cases include investments and business ties with Kuwait, Saudi Arabia, Dubai, Saddam’s Iraq (once upon a time), Mobutu’s Zaire and Apartheid SA.

Western countries trade with and invest in China, and yet China is certainly not a Western-type democracy. If the West does not put democracy or human rights pre-conditions to China before they deal with it, why should China put such conditionalities to African regimes before engagement? In any case, how can an “undemocratic” one Party State China insist on human rights pre-requisites to African nations? Will they be credible demanding multi-party free and fair elections which they themselves do not conduct? Really? It is safe to say most of the arguments against Chinese activities in Africa, inspired and driven by Western Governments and their corporates, are hypocritical and meaningless. They are views of competitors who have been out-gunned. Africans are best advised not to attack China on behalf of these outsmarted Americans and Europeans.

Lest we are misunderstood, democracy, respect of human rights and good governance in African countries concepts are foundational in our agenda to build sustainable and viable African economies and societies. However, it is our submission that these ideals are not what influence, drive or determine the inflow of Western investment and its corresponding trade frameworks. History and current practices bear this assertion out. National economic interest, corporate & business ambitions, and geo-political-military considerations alone determine the direction of Western trade and investment. 

Africans must embrace democracy on their own without depending on pressure from external powers. In doing so, we must fully engage in and learn from the democracy vs. economic development debate. The doctrine that says “Seek first the Kingdom of Democracy” and the rest will follow, is not only flawed, but is also not backed by history. For example; Singapore, China, Saudi Arabia, Taiwan, Malaysia, and Dubai do not exactly fit into the Western definition of democratic States, but they are quite economically prosperous. Malawi, Zambia, and South Africa fairly satisfy the Western democratic prescriptions, but the majority of their citizens are crippled by poverty, inequality and unemployment. There are no simple cut-and-paste solutions. A nation can be prosperous without following the Western democracy model, while embracing such a model does not guarantee economic success.

The contrived and tenuous links between democracy and economic development should be rejected with the contempt that they deserve. Democracy must be embraced as a public good in itself, not as a precondition for something else. A democratic tradition, respect for human rights, and a good governance disposition allow our people to express themselves and determine their destiny as fully empowered citizens. African States must internally, without depending on the benevolence or conditionalities of external players, strive to creatively and simultaneously achieve both democracy and economic prosperity.

The second type of critique levelled against the Chinese in Africa comes from the Africans themselves. These are genuine concerns coming from African policy makers and business leaders, who want a win – win arrangement between Africa and China. They speak on behalf of African interests and hold no brief for Western nations. Given the history of collaboration and partnership, between Africa and China, in the struggle against colonialism and imperialism, there are high expectations from the economic ties between the two blocks. These high expectations are rooted in a history of solidarity and shared aspirations. So when criticism is levelled by the sincere African, it must be considered as constructive dialogue among members of one family.

The Chinese must not be defensive to these genuine African concerns; extractive trade in raw materials without value addition, understating the value of un-mined natural resources, bringing labour from China with low employment of locals, no skills or technology transfer, buying primary goods and selling Africa manufactured goods, unfair local labour practices, cheaper Chinese goods (sometimes low quality) undercutting African products. All these activities, the Africans contend, have contributed to the de-industrialization and underdevelopment of Africa. In particular the African textile industry has been decimated by cheap Chinese imports. While China’s trade with Africa has surged $10 billion in 2000 to $166 billion in 2011, this has mainly been in exchange of African minerals for Chinese manufactured goods. Chinese imports are undermining Africa’s own manufacturing businesses. For example, in SA manufacturing only contributes 15% of GDP, while in Kenya and Nigeria it is 11% and 10%, respectively.

Given all these challenges what should be the African strategic response? First and foremost African countries MUST NOT blame China. We must take responsibility for our problems and solve them. In fact, we must blame ourselves for the current plight of Africa, including these Chinese excesses. Most of the African countries attained political independence more than 50 years ago. As illustration, Ghana has been free for almost 2 generations (56 years); Zimbabwe, 33 years; and South Africa, 19 years. For sure there are problems whose roots you can trace back to slavery, colonialism, neo-colonialism or apartheid. However, we cannot use this problematic African history to justify incompetence, corruption, lack of economic vision, inept economic planning, poor execution, and now clumsy negotiation capacity. The time for excuses is gone. Africans must wake up and take charge of their lives.

With respect to China, a different approach is required. Africans must not have a romantic and sentimental view of China as an ally in the fight against imperialism. China is no longer a fellow poor or developing country. Neither is it still a “comrade in poverty solidarity.” They are now a global business and economic giant which is now the second biggest economy in the world. The Chinese are coming to Africa as shrewd business players who are very discerning about their national and commercial interests. They are no longer comrades in the Chairman Mao sense. In some cases, they are shrewder and tougher business negotiators than the Westerners. Nonetheless, the African is not without bargaining power. Yes Africa needs China but China also needs Africa. What is imperative is to create an equitable relationship where both China and Africa benefit.

To do this, Africans must define the terms of reference and engagement with the Chinese. The Africans must leverage their strengths, negotiate better, box clever, and deploy innovative hard-nosed strategic and economic thinking. We have the natural resources, the arable land, the climate, the human capital, and markets that China needs. Why can’t we use these assets to set the favourable terms for our economies; that will allow the Chinese to make money while effectively and sustainably developing the continent? This is the win-win framework we must strive for.

We must put in place policies, incentives, guidelines and directives which will encourage and compel the Chinese to set up processing and manufacturing plants on African soil, ensure employment of Africans, ensure transfer of skills, technology & knowledge to Africa. In terms of quality of Chinese products, quality control, education of the traders, consumers and producers coupled with bilateral quality agreements can assist. All these policy interventions must be effectively and consistently implemented, while there is comprehensive monitoring and evaluation, leading to corrective actions.

In all these initiatives, African states must start measuring different metrics. The traditional parameters such as GDP and GDP growth rate are highly inadequate. We must clearly track per capita income, gini coefficient (measure of income inequality), economic productivity, productivity growth, nature of economic growth, per capita power, social & political issues, national values, and spirituality. We must measure the size of the middle class as a percentage of population, ICT penetration, bandwidth, connectivity, ICT infrastructure, ICT cost and pricing, and ICT competition. These are the key measures to judge success or failure of African economies. That which is monitored and evaluated, is what influences policy and strategy.

To be continued

By Prof Arthur G.O. Mutambara
Deputy Prime Minister, Republic of Zimbabwe.