chinese exodus of influence

In the early days of African discovery soldiers, missionaries, and explorers led the way towards the attempted understanding of and preceding conquest of Africa. This push came from the world powers of the day in Western Europe – now we see a new wave of settlers moving in on the African continent. However, this exodus should not be a surprise. Lured by the increase in wealth, property, and life style, Chinese migrants are starting new lives in Africa. Approved by the Beijing government, the migrants are involved in agriculture reform, construction (which is a huge Chinese business in Africa), and trade.

The Chinese relationship with Africa is strong and this new development should not come as a surprise. “To build a unified front against imperialism,” was the Chinese goal in the 1950s. This involved supporting the growing African decolonization, nationalist movements, and revolutions. There is a strong history of economic ties between China and Africa. We can see this in Chinese blue and white porcelain found at African gravesites from the expeditions of Zheng He. Zheng He left the Cape of Good Hope with the gift of a giraffe. Trade relations with China only increased from there.

China began its first bilateral agreements in 1956 with Egypt, Algeria, Morocco, Sudan, and Guinea. China had been in agreement with the Soviet Union in supporting African revolutions, but China became more interested in providing financial and military support for nationalist movements. In the 1960s there were nineteen African countries with official ties to Beijing. The recent wave of nearly 750,000 Chinese migrants are not the first. In the 1960s Mao Zedong sent people to forge political ties with the continent. This newest wave or Chinese people is to strengthen the Chinese claims over raw materials and markets. The head of the China Export-Import Bank has said that he will support this migration with “investment, project development, and help with the sale of products.” Mr. Li says,”There’s no harm in allowing [Chinese] farmers to leave the country to become farm owners [in Africa],” he added.

Mission of the China Export-Import Bank:

The main mandate of the Bank is to implement the state policies in industry, foreign trade and economy and finance to provide policy financial support so as to promote the export of Chinese mechanical and electronic products and high- and new-tech products, to support Chinese companies with comparative advantages to “go global” for offshore construction contracts and overseas investment projects, to develop and strengthen relations with foreign countries, and to enhance Sino-foreign economic and technological cooperation and exchanges.

Beyond the trade relations that are now ever growing, the political ties have been and remain strong. During the 1960s China provided military and financial to nationalist movements as well as increasing development dollars – $100 million. They also sent 150,000 technicians to implement projects in agriculture, transport, and infrastructure development. China was involved in numerous independence movements. In the build-up to democracy in the Democratic Republic of the Congo, China was providing financial support, but it wasn’t enough. After Lumumba was assassinated by the efforts of the CIA, the Chinese demonstrated en masse. Millions gathered in Peking, 400,000 in Shanghai which solidified the Chinese influence and support for further revolutionary movements. A new regime was supported in Tanzania (1964) until Nyerere took power. Nyerere even adopted the Mao-style uniform. Chinese engineers built a railroad from Zambia to Dar es Salaam, Tanzania showing the Chinese economic might and proving that China was serious in Africa. China supported many nationalist and revolutionary movements (see map) with arms, money, medical supplies, scholarships, and guerrilla trainings and camps.

In 1971 China received 76 votes for a permanent UN Security Council seat. Of those votes 26 were from African countries and by the 1980s fourty-four African countries had established diplomatic ties with Beijing. These ties soon faded out, but have recently been rekindled in the 1990s and more recently in 2006. In the third China-Africa forum 48 African countries were represented. China now represents the leading Asian developing giant, above India, Singapore, and Thailand. China now rivals OECD countries or the developed West in providing foreign aid (rogue aid). China now outbids the World Bank and in 2006-2008 provided over $10 billion in loans to African countries.

China has regained its strong influence in African countries. Their power is unmatched and their recent wave of settlement unprecedented. This is a point of contention for both Western powers who may be afraid of the growing Chinese power and the people of African countries who should be wary of another exploiter. The Chinese may have a history of support, development, and influence, but that does not justify current action.

Featured entry on The Issue: China in Africa

oil to the people?

Nigeria’s economic focus on the trade of oil can be reversed from being its greatest downfall to being its greatest achievement. Currently, Nigeria’s economy is fueled and supported by the energy sector and the international trade system. Nigeria is Africa’s largest exporter of oil, being the number one exporter to China and the fifth largest supplier to the US. However, the corruption of the government, the un-diversified economy, political instability, and poor management has led to an over-dependence on the oil sector. The oil sector currently supplies 20% of Nigeria’s GDP, 95% of its foreign exchange earnings, and 80% of its budget revenues. The oil sector has not led to an end to the crushing poverty of Nigeria and this leads many to join the rebel groups combating foreign involvement and trade. Nigeria used to be a large exporter of food, but with an emphasis on fossil fuels and a growing population, the agriculture sector could not keep up and now the consequences can be seen.

Nigeria’s focus on international trade in oil has developed the problems that Nigeria now faces. International trade is the oldest and most controversial subject within the international political economy. International trade is the production structure of the international political economy, this means it deals with relations between states and non-state actors such as international businesses. Controversy on the international trade structure comes about when the state governments and international businesses grab the economic benefits and limit the negative effects on themselves. This controversy could not be more evident in Nigeria’s case as the government works to fight corruption of politicians, angered rebel groups, and the hunger of foreign governments and investors for raw materials. From Nigeria’s agreements and interactions with other countries in the international political economy we can view Nigeria’s place within the international system.

If you were to look at Nigeria’s international dealings with China and the US, you would notice two different perspectives on international trade. One perspective is China being mercantilist as they work to create bi-lateral agreements and the other, the US, with a push for a more liberal global system to allow multinational corporations access to the market. Hu Jintao, President of China, visited Nigeria for a second time in 2003 and secured four oil-drilling licenses for China in exchange for investing nearly $4 billion in infrastructure projects. In the international trade system, China is looking for a market to place its abundance of cheap goods and Nigeria is looking for a reliable importer of its oil who will also support the country financially. China is also on the search for natural resources to fuel its growing population. Yet the US is also seeking a place to receive oil as it looks to become less dependent on the Americas. US corporate interests are high in the energy sector and the US government has offer much help in the way of democratic reform. However as the world’s powers seek to find sources of energy, the instability of the Niger Delta region of Nigeria causes much concern as both US and Chinese workers are held hostage. This creates a strain on the pricing of production and consumption of oil. Likewise the kidnapping of foreign oil workers creates political tension, which could potentially lead to future problems in trade with Nigeria.

Nigeria now holds a prominent position as the world searches for its fossil fuel fix. With their abundance of oil, Nigeria has the potential to reform its political system and create positive trends from its trade in oil. The flow of oil brings in investors and in turn these investors can be used to build the countries dying infrastructure. As has been evidenced by China’s recent push in Nigeria, countries are willing to invest in Nigeria to have access to its oil. However, investors will not be able to help with ethnic tensions in the oil-producing region. Nigeria will need to solve its internal problems if they are to keep a hold on their oil-trading niche. There is now a significant push to calm those problems through social and economic development programs run by government agencies and multinational corporations. As Balaam writes, “If wealth is power, then trade is both.” Nigeria needs to be sure to use its trading power as both an internal development tool and a foreign policy tool. Nigeria needs its investors and MNCs to focus on more then just their international responsibility to provide oil to consumers. They need to have these international partners assist in focusing on domestic issues in order to be a trading partner.

In February 2007, the Nigeria Oil and Gas (NGO7) Strategic Conference was held. The conference held attendance from over 550 delegates from almost 70 companies in the Nigerian oil and gas market. Interesting to note is that although China has recently become a front-runner in Nigerian assistance, speakers at the conference included country managers and directors from the large US oil companies, however only one from a Chinese company. Was this a political move or are the US companies most prominent in Nigeria at this time? Time will tell.

The greatest hope for Nigeria is foreign investment. With foreign investment focused on development and reforms focused on eliminating corruption Nigeria will be able to become a more important regional and international trader. Investments are increasing in Nigeria. Companies are seeking long-term investment and are especially searching for trade in raw materials. Nigeria holds a huge potential and it needs to use its power in the international political economy to reverse past trends and push for greater development assistance from investors. Along with bringing in foreign investors, Nigeria needs to stress an understanding by investors of local conditions and make partnerships carefully.