US-Africa Ties Strengthen Africa’s Bargain With China

Published on 18th August 2014

According to Wikipedia, China and Africa have a history of trade relations, sometimes through third parties, dating back as far as 202 BC and AD 220. The first mention of Africa in Chinese sources was in the Yu-yang-tsa-tsu by Tuan Ch'eng-shih (died 863), a compendium of general knowledge where he wrote about the land of Po-pa-li (referring to Somalia).

Fast forward, China-Africa trade reached $166 billion in 2011, an 83 percent rise from 2009. The bilateral trade further increased another 19.3 percent to $198 billion in 2012, and passed the $200 billion threshold to $210 billion in 2013. In contrast, U.S. trade in goods with Africa has been on a downward trend since 2011. U.S.-Africa trade dwindled from $125 billion in 2011 to $99 billion in 2012 and $85 billion in 2013, largely due to  the 2008 financial crisis, reduced remittances  and  uncertainty around the 2012 renewal of AGOA's third-country fabric provision. Now the US economy is rebounding and renewal of AGOA is in the offing.

There have been muted and chilly undertones by Africa’s leadership, businesses and citizenry about China’s comprador business tactics in Africa. Whereas, with absence of competitive options, Africa has been and continues to be grateful to China’s unprecedented investments in Africa’s much needed nerve infrastructure – like roads, railways, dams, ICTs, and strategic installation buildings – like The African Union headquarters among others, Africa has been quietly uncomfortable with the fact that China's investments have been  extractive in nature, leaving behind no capacity, knowledge, skills and jobs in Africa.

Chinese companies for instance come with their own concrete mixers and ditch diggers while constructing roads in Africa. They even leave behind maintenance corps when the projects are completed. Africans have been bystanders, grappling with mixed feelings about the grand and strategic investments of China in Africa that leave behind no immediate empowerment.

The recently ended August 4th -7th, 2014 US-Africa Leaders’ summit is therefore expected to put pressure on China to play fair and also strengthen the position of African governments and Companies to bargain for favorable win-win deals with China.

Africa is expected to have a strong stomach lining and backbone to tell China not come with Chinese ditch diggers, concrete mixers and leave behind maintenance corps but rather work with the abundant labor resources in Africa. The competition from America’s companies in the area of Oil and Gas, renewable energy, minerals and gemstones, information technology, and transport infrastructure will throw Africa, into the historical favorable position of non-alignment, a resurgent Africa that negotiates with both economic powers from the position of strength. For this to happen, it will have to take shrewdness of African leaders, entrepreneurs’ and business associations, but also the willingness of African governments to construct a democratic business environment that guarantees transparency, efficiency and predictability.

African middlemen and commission agents whose business has been to help predator companies to short-circuit Africa’s bureaucracy will have to be checked and regulated. Bribery and outright corruption in award of contracts will have to be reigned-in if Africa is to attract credible business partners from the United States of America. The attitude of Africa’s bureaucracy and officialdom will also have to change and be pro-business and agile.

I think Africa is ready and regional and continental mechanisms like the East African Community, COMMESA, SADAC, and ECOWAS and African Development Bank will be key in making regional and continental wide business agenda possible. Recently, James Shikwati wrote that Africa must craft its own dream to survive and transform. I agree with him and I think such a dream lies in in Africa’s non alignment position that the continent missed the opportunity of defining and expanding during and after the cold war.

By Morrison Rwakakamba,

The author  mrwakakamba@gmail.com  is Chief Executive Officer, Agency for Transformation, a Think-and-Do- Tank based in Kampala, Uganda.


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