Is China a contributor to or a beneficiary of Africa's economic and social development? It's complicated. China's economic engagement in Africa has stirred up a lot of controversy, but could end up contributing greatly to political stability on the continent.
Africa's natural resources and young population base make the continent highly attractive to global investors but these are both a blessing and a curse. If a poor but resource-rich country wants to maintain stable development, a reasonable governance system is needed to cope with sensitive issues like an equal distribution of wealth. However, political systems in some African countries are influenced by their colonial history, making that difficult to achieve. It is also not easy to solve employment problems under flawed political systems, as a large number of unemployed young people threaten social stability.
Some Western media depict China as a neocolonialist conqueror, claiming it is exploiting African resources for its own economic growth. However, one factor ignored is that China is the largest manufacturing economy in the world. China and Africa share a large potential for cooperation in manufacturing industries, making Sino-African economic ties fundamentally different from relations between Africa and its former colonists.
Ethiopia is currently ramping up efforts to attract foreign investment in its export-oriented manufacturing sectors which could play a big role in boosting employment. Meanwhile China is witnessing a boom in outbound direct investment. Chinese textile and apparel firms have been increasing investment in Ethiopia due to the low labor cost advantage where production costs are reportedly one-seventh that in China.
Over the past several years, a growing number of Chinese companies have participated in infrastructure construction in Ethiopia. Infrastructure advancement creates a foundation for the African nation to develop manufacturing industry.
China is expected to continue in this pattern to improve its economic relations with other African countries. With China's economic slowdown, which has cut into its resource imports from Africa, Sino-African ties are undergoing changes and adjustments as more focus is placed on cooperation in infrastructure and manufacturing.
Manufacturing in Africa did not make substantial progress during various periods of colonization. In contrast, China is working with African countries to expand their manufacturing industry capabilities, a move which could contribute to political stability as more young people get jobs and local economies reduce their dependence on resource-heavy industries. Social and political instability have long been the main barriers for foreign companies investing in the continent. Manufacturing investment from China to Africa is likely to form a virtuous cycle for sustainable cooperation.
The author is a reporter with the Global Times. email@example.com