Tuesday, May 9, 2017

Guest Post: Desert Mirage: Fact-checking China in Namibia


This guest post is by Jyhjong Hwang, the Senior Research Assistant at the China-Africa Research Initiative at Johns Hopkins SAIS.

On Sunday, The New York Times Magazine published an extremely well-written article by Brook Larmer, a human interest story on the Chinese in Africa, with a focus on Namibia. The title, “Is China the World’s New Colonial Power?,” piqued our interest. This title might have looked original in 2005, but why did the NYT use this title in 2017?! 

Time for the China-Africa Research Initiative at Johns Hopkins SAIS (SAIS-CARI) to fact-check.

“A $60 billion Chinese infrastructure fund established in 2016?” 
CARI says: “No way.”

First off, the article states: "Last year, China established a new $60 billion fund to finance infrastructure projects in Africa, mostly with Chinese lending." Nothing like this exists. The article could be referring to the combined "pledges" made by China during the December 2015 Forum on China-Africa Cooperation (FOCAC) in Johannesburg, South Africa. This is how FOCAC officially described the pledges: "Of the total 60 billion dollars, 5 billion is offered as aid gratis and interest-free loans, 35 billion of concessional loans and export credits, with increased preference; 5 billion of investment augmentation into the China-Africa Development Fund and Special Loans for Development of Small and Medium Enterprises in Africa, respectively, and the initial 10 billion for foundation of the China-Africa Capacity Cooperation Fund [for industrial investment]."[i] Thus, the US$60 billion does not constitute a single fund and it is not focused on infrastructure. It includes a host of financial instruments, including loans, grants and investments.

“Chinese loans have saddled Namibia’s economy with debt.” CARI says: “No.”

The article also states that “infrastructure is welcome, but as projects made possible by loans — financed by the Chinese — they have saddled the economy with debt.”  Of Namibia’s US$6.24 billion external debt stock (for more on this see Academic Appendix below), how much of it can be attributed to China? CARI’s database on Chinese loans to Africa indicates that between 2000 and May 2017 all Chinese loans from the Chinese government and from Chinese companies to Namibia totaled US$729 million, about 12 percent of Namibia’s total external debt stock. It is a bit of a stretch to say that Namibia's economy is “saddled” with Chinese loans.


Major Loans from China to Namibia (US$707 million)



  • US$250 million Preferential Export Buyer’s Credit (PEBC) from China Eximbank for Namibia to purchase locomotives and train carriages from China (2005)
  • US$100 million PEBC from China Eximbank for Namibia to purchase customs X-ray scanners from China (2007)
  • US$135 million Concessional Loan from China Eximbank to upgrade the MR67 and DR3602 roads (2012)
  • US$222 million Commercial Loan offered by the Chinese company Swakop Uranium to the Namibian state-owned company Epangelo to purchase a 10 percent stake in the Husab Uranium Mine (2012)

The NYT article does hedge with the following:

“Is China the savior for developing nations, the only world power investing in their future — or is this the dawn of a new colonial era? The question itself, however, is misleading. In Namibia, as in much of the rest of the world, the narratives live uncomfortably side by side, impossible to disentangle.”
We at CARI agree. So much that we recommend putting this paragraph up front and making sure grandiose statements are 1) researched, and 2) in context.


Academic Appendix: More on Namibia’s total debt:


“Chinese loans have saddled Namibia’s economy with debt.”
CARI says: “It’s not China.”

The article states that “as sluggish growth and other foreign loans pushed Namibia’s debt to over 40 percent of its G.D.P., the government suspended all new loan tenders.” According to the IMF's 2016 Article IV reported published in December 2016, Namibia's 2016 projected external debt is about US$6.29 billion: “In 2015, Namibia's gross external debt increased as the public sector returned to the international market. The stock of public and publicly guaranteed (PPG) external debt (including SOEs) increased by 6 percent of GDP, reaching 15.6 percent of GDP at end- 2015, due to new rand-denominated issuances in the JSE and the November 2015 Eurobond [...] The external debt-to-GDP ratio is expected to rise from 51 percent in 2015 to about 60½ percent of GDP in 2016."[ii] The IMF is referring to a US$750 million ten-year Eurobond issued in 2015, and rand-denominated bonds that were first made available on the Johannesburg Stock Exchange in 2012 and have since issued R1,550 million (about US$115 million) worth of bonds at the time of the IMF report.[iii] Thus, the recent increase in Namibia's external debt is mostly due to their issuance of sovereign bonds, not because they borrowed more loans from bilateral or multilateral partners.






[i] "60 billion USD: China-Africa Cooperation Aims High". Forum on China-Africa Cooperation.  January 13, 2016. http://www.focac.org/eng/zfgx/t1331126.htm




[ii] Namibia 2016 Article IV Consultation - press release; staff report; and statement by the executive director for Namibia. IMF Country Report No. 16/373. International Monetary Fund, December 2016. http://www.imf.org/external/pubs/ft/scr/2016/cr16373.pdf.




[iii] "First Namibian government Bond lists on JSE", Press Release, Johannesburg Stock Exchange, November 19, 2012. http://ir.jse.co.za/phoenix.zhtml?c=198120&p=irol-newsArticle&ID=1762774


Friday, April 21, 2017

Join us on April 26: Prospects for U.S.-China-Africa Relations in the Trump Era


The China-Africa Research Initiative (CARI) at Johns Hopkins SAIS is hosting the following event in Washington DC next week:

Policy Roundtable:

Prospects for U.S.-China-Africa Relations in the Trump Era





Wednesday, April 26, 2017, 11:00 AM – 2:00 PM

Johns Hopkins SAIS – Nitze Building, Kenney-Herter Auditorium

1740 Massachusetts Avenue Northwest, Washington DC 20036

 

 Please make sure to register via Eventbrite: http://bit.ly/2osQ4iA


At the start of Barack Obama’s presidency in 2009, China surpassed the United States as Africa’s top trade partner. As Chinese engagement in Africa continued to diversify, President Obama ushered in an Africa foreign policy that included events such as the U.S.-Africa Leaders’ Summit as well as commitments under Power Africa and Trade Africa. Now, how will the respective roles of the United States and China in Africa change during the Trump administration? Will existing opportunities for constructive trilateral collaboration remain, or will they need to be modified? How will African countries respond to these shifts? This roundtable will draw on the public and private sectors to explore the future of U.S.-China-Africa relations in an evolving geopolitical landscape.


Keynote Address
Peter Lewis

Vice Dean for Academic and Faculty Affairs, Johns Hopkins SAIS


Moderator
Yun Sun

Senior Associate, East Asia Program, Stimson Center


Panelists
John Goodman

Associate Director, Conflict Resolution Program, The Carter Center

Mima Nedelcovych
President and CEO, Initiative for Global Development


Bobby Pittman

Managing Partner, Kupanda Capital


Leocadia Zak

Former Director, U.S. Trade and Development Agency


A light lunch will be served from 11:00 am to 12:00 pm. The roundtable discussion will take place from 12:00 pm to 2:00 pm. 
This event is free and open to the public.
 

Wednesday, March 1, 2017

China, Djibouti, and the New York TImes: How Much Debt?

The New York Times had a front page article on China and Djibouti this past weekend: "U.S. Wary of its New Neighbor in Djibouti -- a Chinese Naval Base." Like many observers, the NYT seems to have been misled about the scale of Chinese engagement, and Chinese lending to Djibouti in particular. Here's what they said:
Beyond surveillance concerns, United States officials, citing the billions of dollars in Chinese loans to Djibouti’s heavily indebted government, wonder about the long-term durability of an alliance that has served Washington well in its global fight against Islamic extremism.
Here at the China Africa Research Initiative we specialize in tracking and confirming Chinese loans in Africa. We have not been contacted by the US government, and we wonder where they are getting their "data"? In this instance, we were able to interview top ranking officials in Djibouti's Ministry of Finance to confirm Chinese loan financing.

Signed Loans/Debts Owed by Djibouti to Chinese Government (past decade). All in US$

1. Goubet/Ghoubet Salt Port Expansion:                                    64 million
2. Addis-Djibouti Railway (Djibouti share):                             492 million
3. Djibouti-Ethiopia Water Pipeline:                                         322 million
4. Doraleh Container Terminal/Multipurpose
Port Expansion (the endpoint of the Ethiopia-Djibouti Railway)
and Damerjog Livestock Export Port:                                        405 million

TOTAL                                                                                      $1283 million, or $1.3 billion

We also have a confirmed report of $596 million in Chinese finance for two new airports, but this appears to be either a Chinese company suppliers' credit or a public-private partnership investment, not a Chinese government loan. However, even if we add this, the total comes to $1.9 billion. While several other projects--most prominently a toll road highway to the border--have been in the news, we confirmed that they are all still under discussion. Yes, $1.3 billion or even $1.9 billion is a large figure, but it seems inaccurate to call it "billions of dollars in Chinese loans".

Undue alarmism? Another case of "alternative facts"? More reason to support an increase of $58 billion in the US defense budget? From what we can see, China's main rival in Djibouti has not been the US, but Dubai Ports World, which had a number of public-private partnership (PPP) port contracts in Djibouti, and had also arranged financing to build and operate ports in this important gateway to land-locked Ethiopia, one of Africa's most populous and dynamic countries.

As always, if someone has better information, please comment here or contact us directly at SAIS-CARI at Johns Hopkins University.

Monday, December 12, 2016

China, the DRC, and the Sicomines Project: new from Johanna Malm

Johanna Malm is our foremost analyst of the huge Sicomines project in which China Eximbank agreed to finance an infrastructure package, while a consortium of Chinese companies were to develop a mine, which would repay the infrastructure loans. This project, first conceived about a decade ago, has been very slow to unfold. 

Johanna began doing research on this project in 2008, under her maiden name Johanna Jansson. With her Ph.D. dissertation approved, she has produced a policy brief on her dissertation, published by the Swedish Expert Group for Aid Studies, available here. As Johanna notes, this was not an aid arrangement: 
"The key argument is that Chinese commercial loans do challenge the IMF's power in Africa, at least to the extent that they materialise. The brief starts out with a two-page summary that I have worked hard on to make it accessible to a target group broad enough to include my own aunt as well as American policy makers! Feel free to spread the brief to those who might be interested!"
Johanna's dissertation is available here. She recommends that those interested in her fieldwork and the IMF's role should read chapter 5 (sections 1 and 4) and chapters 6 and 7.

Friday, November 18, 2016

UN Report confirms Chinese peacekeepers abandoned posts in South Sudan during July fighting

photo: UNMISS/JC McIlwaine
In September, the Center for Civilians in Conflict charged that Chinese peacekeepers had abandoned their posts during a vicious outbreak of violence involving government and rebel troops, July 2016. This was denied by the Chinese defense ministry.

On November 1, the UN released the summary of their special investigation of the UN mission's role in this violent outbreak. Major General (retired) Patrick Cammaert headed up the team. Here is the section of the executive summary that addresses the role of the Chinese battalion (the entire report has not been released).
"On the uniformed side, the Force did not operate under a unified command, resulting in multiple and sometimes conflicting orders to the four troop contingents from China, Ethiopia, Nepal and India, and ultimately underusing the more than 1,800 infantry troops at UN House. The Force Commander appointed the Chinese Battalion Commander as the Incident Commander, commanding all the forces at the UN House in addition to his own battalion. Furthermore, the Force Commander ordered the Incident Commander to retain an explicit and ultimately confusing command link to Sector South headquarters in Tomping, which was physically cut off from the UN House for the duration of the fighting. 
This confused arrangement, in combination with the lack of leadership on the ground, contributed to incidents of poor performance among the military and police contingents at UN House. This included at least two instances in which the Chinese battalion abandoned some of its defensive positions at POC [Protection of Civilians site] 1 on 10 and 11 July. The Nepalese Formed Police Unit’s performance to stop looting by some IDPs inside UN House and control the crowd was inadequate." 
Clearly there was a significant breakdown within the UN force command, which hampered the Chinese role. The Kenyan Force Commander in charge of the UN military mission was dismissed. Yet this does not fully explain why the Chinese soldiers abandoned their posts. I haven't looked into this further, but if someone has, please comment and I will update this post. 

Monday, October 31, 2016

Afrobarometer: China wins favorable reviews in new Africa survey

How do Africans view China's economic presence on the continent? The latest Afrobarometer survey reports that on average, 63% of Africans surveyed believed China to be a "somewhat" or "very positive" influence in their countries while "only 15% see it as somewhat/very negative." As Afrobarometer summarized:  
Findings from Afrobarometer’s 2014/2015 surveys in 36 African countries, which included a special series of questions on China, suggest that the public holds generally favourable views of economic and assistance activities by China. Africans rank the United States and China No. 1 and 2, respectively, as development models for their own countries. Remarkably, in three of five African regions, China either matches or surpasses the United States in popularity as a development model. In terms of their current influence, the two countries are outpaced only by Africa’s former colonial powers. 
Public perceptions not only confirm China’s important economic and political role in Africa but also generally portray its influence as beneficial. China’s infrastructure/ development and business investments are seen as reasons for China’s positive image in Africa, though that image is tainted by perceptions of poor-quality Chinese products.
While media reports may describe this as something new, in fact it is quite close to previous public opinion surveys on this issue. For data and links, see my past posts on China and public opinion in 2014 and 2010. For my comments on a poorly designed public opinion survey that came to the opposite conclusion from Afrobarometer's rigorous methodology, see here.

The full Afrobarometer report can be downloaded here.

photo source: Afrobarometer.org

Thursday, October 20, 2016

Are Africans negative about Chinese business impact? Good folks, Bad research

In February 2014, the Ethics Institute of South Africa (EthicsSA) released the results of an opinion survey on Chinese business in Africa. "Africans are generally negative about the impact of Chinese business on the continent," EthicsSA announced. "This is the key finding."

Even though the findings surprisingly contradict other public opinion surveys, which are generally positive about China's impact in Africa, they have been cited multiple times by reporters and researchers. Yet I have never seen any critique of the selection and confirmation biases in their (pretty flawed) methodology.

In the past week I have seen this study cited yet again by two papers, including a draft working paper by one of our SAIS-CARI research teams -- which reminded me that this blog post -- which I see I've started and abandoned four times (!) is way overdue.

The EthicsSA team are no doubt good folks, but their report has severe methodological weaknesses that should lead any researcher to treat it not as a proper public opinion survey, but as an excellent example of selection and confirmation bias.

Of course, as a researcher, when I got my first alert about this survey, I went to the full report. It is immediately obvious that it is a bit hard to say something like "Africans are generally negative" on the basis of data primarily from three countries (the online survey had 1056 respondents, mainly from South Africa, Nigeria, and Kenya).  But this may be the least of the significant flaws of the study.

1. Selection Bias

"Selection bias is the selection of individuals, groups or data for analysis in such a way that proper randomization is not achieved, thereby ensuring that the sample obtained is not representative of the population intended to be analyzed (Wikipedia)." 

Is this a representative sample of "Africans" or even the population of the three countries where the survey mainly took place?

Hardly. The full report notes that the researchers elicited responses from 15 African countries -- via the internet -- but received low response rates. Here's how they did it:
"Invitations to participate in the survey were extended to contacts of the Ethics Institute of South Africa (EthicsSA) and of Globethics.net in the respective countries. ... The initial objective was to achieve a representative sample for each of the participating countries. However, reliance on only the networks of EthicsSA and Globethics.net in the participating countries and on the media to encourage participation were insufficient to attract the required response. Thus, the data collected was not representative of the populations of the participating countries. The only countries that produced sizable samples were South Africa (299 respondents), Nigeria (197 respondents) and Kenya (204 respondents). 
So how did this method of attracting respondents bias the sample?

The report notes that the "low response rate can partly be attributed to the online format of the questionnaire. In many African countries, internet access still remains a luxury rather than the norm."

And in keeping with the fact that internet access is "a luxury," the report notes that 54% of the respondents had post-graduate degrees, while another 27% had university degrees. For Nigeria, this bias was even more pronounced with 74.5% of the respondents having post-graduate degrees, and 24% graduate degrees: i.e. 98.5% of the Nigerian respondents were very highly educated. So now we know that very highly educated Nigerians, South Africans, and Kenyans -- and perhaps foreigners living in these countries who are on their contact lists -- do not think positively of the Chinese presence.

But there's more: who are these highly educated respondents?

Recall that the Ethics SA sent invitations to participate to their (highly educated, internet-savvy, deeply concerned with ethics) contacts and those of Globethics.net in the respective countries. This creates even more bias. One might call it confirmation bias.

2. Confirmation Bias

"The tendency to search for, interpret, favor, and recall information in a way that confirms one's preexisting beliefs or hypotheses, while giving disproportionately less consideration to alternative possibilities (Wikipedia). 

To see how confirmation bias worked in this survey, imagine the US Chamber of Commerce doing a survey on free trade by sending it out only to its subscriber list.

And imagine the same survey sent to the subscriber list of an important trade union group, American Federation of Labor and Congress of Industrial Organizations (AFL-CIO).

Then imagine either organization issuing a press release saying: "Americans are generally ... [negative/positive] ... about free trade."

Now you can see how providing a questionnaire to one's own contact list is likely to reach a biased sample -- of people who are likely to confirm your own beliefs, rather than alternative beliefs.

3. Other Problems

The report had other problems. Let me mention two. There was no effort to find out if those surveyed actually had direct experience of a Chinese company in their country, or had direct experience of Chinese-built infrastructure. Yet they were asked questions that presumed some prior knowledge. This led to some strange responses.
  • Chinese worker myth. More than half of the respondents -- 53% -- agreed or strongly agreed with a pervasive myth: that Chinese companies only use Chinese citizens as employees. On the other hand, 59% agreed that "Chinese companies create employment opportunities for Africans." Go figure.
  • Quality of Chinese construction. In South Africa, only 10% are happy with [Chinese-built] infrastructural projects." Yet due to protections of local services in South Africa and the strength of local contractors, Chinese builders do a very small amount of business in that country: annually the South Africa market is less than 1% of Chinese companies' African construction business. How many South African respondents would actually know anything about a Chinese-built infrastructure project? On the other hand, in Kenya 88% were satisfied with their Chinese construction projects. Given the large visibility of Chinese-built roads in Nairobi, this is more likely to reflect actual experience. But how do we know?
Ultimately, what we have in this survey is a sample of the prejudices and beliefs of a small group of highly educated people in three African countries who are deeply concerned with issues of ethics -- but may not actually know that much about China in their country. 

For the most part, these beliefs of the highly educated classes in three African countries echo what we might expect to find in Europe or the US. This is not unexpected. At the end of the day, given that much about these respondents is held constant (education level almost uniformly high, value system probably quite consistent), it might be only in the variance among them that we can find something useful for analysis.

----
Ethics Institute of South Africa. (2014) “Africans’ Perception of Chinese Business in Africa: A Survey,” (February), pp. 1-41. 

Friday, September 30, 2016

Orient Express: Chinese Infrastructure Engagement in Africa


Save the date for our 3rd Annual China-Africa Research Initiative (CARI) Conference, which will be held on October 13 & 14, 2016 at the Johns Hopkins University School of Advanced International Studies (SAIS) in Washington DC. 
This year’s theme is “Orient Express: Chinese Infrastructure Engagement in Africa,” and we are pleased to have Dr. Jamie Monson, Professor of History and Director of African Studies at Michigan State University, as our keynote speaker. 
The full agenda can be viewed here.To secure your spot at our conference, please sign up here.

Monday, September 5, 2016

Chinese Private Security Companies Go to Africa

Trainee in Beijing bodyguard training camp.  photo credit CFP
China's "going out" policy has landed Chinese firms in many high risk environments. Not surprisingly, this has stimulated the growth of private security companies (PSC) "with Chinese characteristics." The first private Chinese security firm to operate overseas was, apparently, a Ningbo company, in 2004. Although most of these companies operate in truly high risk areas such as Iraq or Afghanistan, they are also increasingly present in places like Kenya.
"The demand is huge especially as more Chinese enterprises will go abroad inspired by the Belt and Road initiative. We are now trying to expand our business to more countries, including Pakistan and Bhutan," one company told the Global Times.
Apparently, however, Chinese law prohibits citizens from having weapons overseas. As Global Times notes, "the biggest obstacle to Chinese PSCs going abroad is the fact that the government does not support their efforts."
According to China's Criminal Law, those who possess weapons overseas - even if they are doing so according to a foreign nation's laws - may face a maximum sentence of seven years in prison. As Chinese PSCs are banned from sending staff abroad, PSCs' security guards are technically employees of clients, rather than PSCs, once they are sent abroad.
Several short articles provide overviews: for Karthie Lee, click here. And for Andrew Erickson and Gabe Collins, here.

h/t to Ying Xia.

Saturday, August 27, 2016

Thoughts on China, Africa, Per Capita Income, and the Environment

Ivindo Nat'l. Park, Gabon. Michael Nichols, Nat'l Geographic
The environmental impact of China-Africa engagement is one of the top concerns of many who are critical of a rising China in Africa. Others acknowledge the issue as important, but maintain that some from wealthy countries want to impose "Volvo" standards in "Volkswagen" countries.

I sometimes think about how these issues emerged in importance in our own country, the USA. This morning, I read a NYT review of a new book about President Franklin D. Roosevelt, who was the architect of so much of our government's institutional structure. Following in the footsteps of his presidential cousin Teddy Roosevelt, Franklin "created 140 national wildlife refuges, established 29 national forests and 29 national parks and monuments" but he also built many "habitat-destroying hydroelectric dams" and put in place the foundation of our national highway system.

Roosevelt was a visionary. In 1940, he made a speech at Great Smoky Mountains National Park:
We slashed our forests, we used our soils, we encouraged floods ... all of this so greatly that we were brought rather suddenly to face the fact that unless we gave thought to the lives of our children and grandchildren, they would no longer be able to live and to improve upon our American way of life.
In 1940, our income per capita (in 2008 dollars adjusted for inflation) was approximately $7,446. China's income per capita in 2015 (in constant 2010 dollars, according to the World Bank) was about $6,416.  For Sub-Saharan Africa (excluding high income countries), inflation-adjusted per capita income was about $1,651 in 2015.

If environmental concerns rise along with income, as many social scientists believe, China should be approaching a time when sustainability becomes a real, genuine, and public concern for its leaders. Indeed, there is some evidence that over the past decade with the green credit movement and the establishment of a Ministry of the Environment, this is happening. Yet in Africa, it's far more likely that slashed forests, depleted soils, and the encouraging of floods will continue to plague the lives of parents, their children, and their grandchildren, for many years to come. And Chinese companies seeking business will continue to be part of this.

Tuesday, July 26, 2016

Policy Briefs: Cutting Edge China-Africa Research from SAIS-CARI

check out these china-africa publications from the SAIS China africa research initiative (sais-cari):

POLICY BRIEFS

  • Policy Brief 01/2014The Political Ecology of Chinese Investment in Uganda: the Case of Hanhe Farm, Josh Maiyo.
  • Policy Brief 02/2014Chinese Agricultural Investment in Mozambique: the Case of Wanbao Rice Farm, Sérgio Chichava.
  • Policy Brief 03/2014Chinese Training Courses for African Officials: a “Win-Win” Engagement?, Henry Tugendhat.
  • Policy Brief 04/2015Chinese Agricultural Engagement in Zambia: A Grassroots Analysis, Solange Guo Chatelard and Jessica M. Chu.
  • Policy Brief 05/2015Chinese Agricultural Entrepreneurship in Africa: Case Studies in Ghana and Nigeria, Yang Jiao.
  • Policy Brief 06/2015Assessing the Impact of Chinese Investment on Southeast Africa’s Cotton: Moving up the Value Chain?, Tang Xiaoyang.
  • Policy Brief 07/2015: Neither ‘Land Grab’ nor ‘Friendship Farm:’ Chinese Agricultural Engagement in Angola, Zhou Jinyan.
  • Policy Brief 08/2015: Chinese Financed Hydropower Projects in Sub-Saharian AfricaDeborah Brautigam, Jyhjong Hwang, and Lu Wang.
  • Policy Brief 09/2016Looking Back and Moving Forward: An Analysis of China-Africa Economic Trends and the Outcomes of the 2015 Forum on China Africa Cooperation, Janet Eom, Jyhjong Hwang, Ying Xia, and Deborah Brautigam.
  • Policy Brief 10/2016: What Happened to China Development Bank’s $3 Billion Loan to Ghana?, Thomas Chen.
  • Policy Brief 11/2016: How Chinese Money is Transforming Africa: It's Not What You Think, Jyhjong Hwang, Deborah Brautigam, and Janet Eom. (Updated April 31, 2016).
  • Policy Brief 12/2016Media Training for Africa: Is China Exporting its Journalism?, Jákup Emil Hansen.
  • Policy Brief 13/2016Technology Transfer in Telecommunications: Barriers and Opportunities in the Case of Huawei and ZTE in South Africa, June Sun.
  • Policy Brief 14/2016Do Huawei's Training Programs and Centers Transfer Skills to Africa?, Benjamin Tsui.

WORKING PAPERS

  • Working Paper 01/December 2015Chinese Engagement in Hydropower Infrastructure in Sub-Saharan Africa, Jyhjong Hwang, Deborah Brautigam, and Nancy Wang.
  • Working Paper 02/January 2016: Learning from China? Manufacturing Investment and Technology Transfer in Nigeria, Yunnan Chen, Irene Yuan Sun, Rex Uzonna Ukaejiofo, Tang Xiaoyang, and Deborah Brautigam.

Thursday, July 7, 2016

Shout Out: Policy Studies on China-Africa Engagement

SAIS-CARI has been publishing a great policy brief series, if I do say so myself, but we are pleased to be part of a growing trend of interesting work by people with hard-earned and very useful knowledge about China-Africa relations. A few things that have come across my desk (or, more accurately, my email inbox) in recent months:


  • While it's not specific to Africa, colleague Dr. Naohira Kitano at JICA has just published an update of his careful, ground-breaking work on China's overseas official development assistance. Kitano estimates that "China’s net foreign aid increased from US$5.2 billion in 2012 to US$5.4 billion in 2013, but dropped to US$4.9 billion in 2014." 
  • Richard Carey and Jing Gu at the Institute of Development Studies in the UK. I've known both for many years now. Richard was a key figure in the China-DAC Study Group headquartered at the OECD Development Assistance Committee; I attended several of their meetings in the early days of attempts to forge contacts and connections between DAC members and China. Richard and Jing Gu have published a great policy brief on China's Development Finance, focusing helpfully and constructively on the transparency issue.
  • Yuan Wang, Simon Zadek, and a team of people at The International Institute for Sustainable Development has published a very detailed literature review (384 papers!) of the Sustainability Impacts of Chinese Overseas Foreign Investment.This should be the starting point for anyone doing research on this important issue.

Friday, June 24, 2016

China and Africa: Venus and Mars

After the meeting with Mugabe: credit Xinhua
Do you remember the book: "Women are from Venus, Men are From Mars"? It described two very different communication styles. Sometimes I think Chinese and Africans are also speaking past each other. Take this recent headline story from the Herald, the state-controlled Zimbabwe paper: "Zimbabwe: China Envoy Meets President On Deals." The reporter says that China dispatched a special envoy to update President Mugabe on "progress made in the implementation of mega-deals that were signed when the two leaders paid each other reciprocal State visits," noting that "Beijing pledged to bankroll a number of infrastructural projects."

But what kind of new deals did the Chinese really agree to do? And what progress did they report? They agreed to build a new parliamentary building. (Perhaps they are getting ready for a political transition that can't be too far off). The envoy gave fulsome details:  "I reported to President Mugabe that China has already completed the design of the Parliament building and submitted three design plans to the Zimbabwe side and we are waiting for the confirmation from the Zimbabwean side for the early launch of this project." The Chinese also donated 20,000 tons of rice to help Zimbabwe weather its drought. The envoy talked about three projects financed several years ago (Victoria Falls airport and Harare water system, and a power project). No other projects were mentioned.

(In a similar move, after Nigeria's president visited China recently, the Nigerian press was full of stories about an alleged $6 billion loan pledge for infrastructure. Yet there has never been any confirmation of a loan package from the Chinese, who have so far said only that they are prepared to provide a grant of $15 million to help agricultural development in Nigeria. I doubt very much that there was ever a loan pledge -- but I also wouldn't be surprised to see this enter the databases as a commitment of "Chinese aid".)

Some in Zimbabwe understand that their state media is required to trumpet the "success" of Harare's "Look East" policy. Yet most understand that China is not providing much assistance to their troubled country. As Brett Chulu wrote in the Zimbabwe Independent recently about the lack of Chinese support: "There must be something fundamentally amiss when as a country we are failing to access meaningful finance from our supposedly all-weather friend's sea of cash."

So, on the official African side: China is supporting us, big time! On the official Chinese side, the announcement of a donation and a prestige aid project. Venus and Mars?

Saturday, June 18, 2016

Guest Post: Is China taking control of Zambia's national broadcaster? No, it is not.

This guest post is by Dani Madrid Morales  | 马诞宁 
PhD Fellow - Department of Media and Communication  | 博士研究员-媒体与传播系
City University of Hong Kong


Is China taking control of Zambia's national broadcaster? No, it is not.

On September 19, 2015, Zambia's Ministry of Information and Broadcasting Services (MIBS) signed a contract worth US $ 273 million with China's Star Software Technology, a subsidiary of Star Times, to implement phases 2 and 3 of Zambia's migration to digital terrestrial television after successfully winning a public tender . The story which reported at the time by well-established local news outlets,: such as the Zambia's Daily Mail , and international media: such as Reuters . Now, fast-forward to May 2016 When the story resurfaced on a Zambian blog called Zambia Watchdog , but with a very different spin and at alarming headline: ". Startimes cheats PF, signs contract to take over ZNBC operations"

It does not take one long to notice did Zambia Watchdog is a dubious source of information, with a very strong negative bias towards the ruling party, the Patriotic Front (PF) and, by extension, towards China, Which enjoys cordial relationships with the PF , The blog presents itself as a source of "Breaking and Investigative Journalism on Zambia," but reads more like an infuriated collection of difficult-to-believe stories. Here are two representative posts of how China is framed in the blog: " Chinese assassins hired to kill HH, GBM arrive " (June 14, 2016) and " Another minister in China to admire buildings and thank China " (May 29, 2012) , All the stories in the blog are anonymous.

Despite the obvious bias, the May 2016 post on Zambia Watchdog about the takeover of ZNBC, Zambia's National Broadcasting Corporation by Star Times, which soon picked up Nigeria's Leadership newspaper and Several industry blogs, like the one curated by South African journalist Thinus Ferreira , a regular contributor in South African media on television-related stories. None of the two reached out to Star Times for comment. Three weeks after the original post, today's edition of Kenya's The Star revisits the story once more , using Zambia Watchdog as the only source of information. Even if we ignore the factthat republishing a story three weeks after it allegedly occurred does not leave The Star in a very good position, the real trouble in this case is did the original Zambia Watchdog post what plagued with inaccuracies, omitted information and sought no other objective than presenting a distorted view on Startimes operations in Zambia, and criticizing the PF. Here are three of the many inaccurate / incomplete claims in the blog post, Which all Subsequent reports cite.

# 1 - "[T] he deal hands over control of public broadcasting in Zambia to the Chinese for 25 years."
Even though the details of the 2015 agreement were not made public, the takeover of the public broadcaster by a foreign entity would require the amendment of the Zambia National Broadcasting Corporation Act, something Which would Not Easily pass through Parliament without a lot of publicity.

# 2 - ". In the tender process" "In September 2013, Zambia's government canceled a digital terrestrial TV tender Awarded in 2011 to China-backed Star Times Group subsidiary Star Software Technology, due to" Irregularities

In 2013, Zambia's government indeed canceled the tender Awarded to Star Times for phase I of the digital migration, after complaints by two of the other four bidding companies, all of Which, by the way were Chinese (Huawei, ZTE, Gospel Digital Tech and King Tai Investments). HOWEVER, in 2014 Star Times which again Awarded the tender for phase 1, Which what completed in 2015, and then what Awarded tenders for phases 2 and. 3

# 3 - "Under the terms of the deal, Star Times Appears To Be Determined to exclude all other players from the market."

The contract not only does not give Startimes a monopoly over the provision of terrestrial television digital services, but the government has Introduced specific quotas for local content on new stations created after the opening up of frequencies.


There are probably two takeaways from this story, All which is neither the first nor will it be the last in the Which Chinese companies' investments in Africa are misreported. First, Chinese deals in the information and telecommunication sectors in Africa are Usually opaque, Which Means They are difficult to be Subjected to public scrutiny. This sometimes leads to Increased suspicion. A more transparent and open communication strategy by companies like Star Times, Huawei or ZTE Could Certainly reduce examined public skepticism. Second, the ease at Which inaccurate information can be circulated and Reproduced online these days makes it more important for journalists to follow basic professional standards: such as using multiple sources, checking for accuracy of statements and presenting all possible views on a story. Unfortunately, as this blog can testify, thesis are too oft forgotten. 

Friday, June 17, 2016

China's "$10 billion industrial park" in Morocco

Did you see the one about the "$10 billion industrial park" to be built by a Chinese company in Morocco? Don't hold your breath on this one actually happening, but you can be pretty sure that it will enter some of the "Chinese investment" databases as a real investment.

Here's why I have my doubts. The story I saw, circulated by the Center for Chinese Studies in Stellenbosch -- "Morocco, China to Build Industrial Park with $10 bn Investment" -- comes from an official Chinese media source, Xinhua. You might think this would make it more reliable, but read closely. Xinhua is simply repeating a story they picked up from a Moroccan newsite, Medias24.com.  And the so-called investment is simply a memorandum of understanding -- a record of talks.

A quick search reveals that Morocco does hope to set up an industrial park where Chinese firms can manufacture for the European market. An MOU to this effect was signed during Moroccan king Mohammed IV's state visit to China:
"Moreover, Morocco would specially establish a 10 square kilometers industrial zone in the Tangier port in the north Morocco, which is only about 15 miles from Europe, so companies in the industrial zone will be able to send its products to any place in Europe. [Morocco's Minister of Foreign Affairs and Cooperation] says that they welcome Chinese companies, especially who are in automobile, textile and astronautics sectors."
 But there is a long way between a discussion and an investment. One African analyst I quoted said that fewer than 5 percent of MOUs ever result in a project. So, as I said, don't hold your breath.

Saturday, June 11, 2016

China's Humanitarian Aid: Why Is it So Low?

Chinese humanitarian aid is growing, but it's still low compared with the country's wealth. My Google Alert picked up an IRIN article on China's humanitarian aid: "Africa: When Disaster Strikes, Should China Do More?" In The Dragon's Gift, I outlined how the Chinese provide humanitarian aid, and how it had been "greatly increased," from a very low starting point. This began with the Indian Ocean tsunami disaster in early 2005. These increases seemed to have generally been sustained. China's official foreign aid white paper published in 2014 noted that China had provided "1.5 billion yuan ($238 million) worth of materials and cash assistance in emergency humanitarian aid to more than 30 countries" between 2010 and 2012, or an average of nearly $80 million annually.

Humanitarian assistance, according to one definition, means "aid and action designed to save lives, alleviate suffering and maintain and protect human dignity during and in the aftermath of man-made crises and natural disasters, as well as to prevent and strengthen preparedness for the occurrence of such situations." Given the increase reported above, I was surprised to read in the IRIN article that Chinese humanitarian aid for 2014 amounted to "only $54 million" with a source cited as "Development Initiatives." Wasn't 2014 the year of the ebola epidemic, when the Chinese were being praised for their quick and fulsome response?

In January 2016, the Chinese provide a summary of their assistance to the ebola epidemic: "As of November 2014, China offered humanitarian aid worth 750 million yuan (about 113.77 million dollars) and sent thousands of medical personnel to Ebola-hit countries in four rounds of campaigns." (The costs of the medical personnel were not included in the aid figure).

The Chinese are not used to being part of the global donor community, and are not savvy about reporting the value of all of their contributions (i.e. what was the value of the time of the medical personnel? What did it cost to send and house and equip them? They didn't make this calculation). In addition to this figure which is more than double the one cited in the IRIN article, China's contributions in 2014 included sending over 2000 UN Peacekeepers to locations around the world, including Haiti, and posting 55 medical teams on two year assignments, treating patients in 54 countries (this might not be seen as humanitarian aid, but some of these teams are operating in conflict-affected countries).

Yet it's clear that China could do more. Let's take what seems to be the highest annual figure ($113.77 in 2014). With a population of 1.3 billion, this comes to about 9 US cents per person.

The IRIN reporter wrote that China's humanitarian aid is administered by the Ministry of Commerce (which declined to answer their request for an interview). MOFCOM does administer China's official development assistance program, but that's different from humanitarian aid, where MOFCOM is only one part of the foreign emergency response mechanism. It also involves the Ministry of Foreign Affairs, the Foreign Affairs office of the Ministry of National Defense and the Ministry of Civil Affairs.

For two, rather more useful overviews of Chinese humanitarian aid policy, see the ODI policy brief and related ODI blog post by Hannah Krebs, and a UNDP policy brief on this topic.


Friday, May 27, 2016

New Essays: China-Africa, A Maturing Relationship?


c. UNIDO/FlickrJust in time for Memorial Day Weekend: "New policy essays: China-Africa: a maturing relationship? Growth, change and resilience"   DEGRP has just published its latest set of policy essays based on discussion at a DEGRP event held in Johannesburg last December, in parallel with the second summit of the Forum on China-Africa Cooperation Summit.  Featuring contributions from DEGRP China-Africa researchers, as well as a keynote speech from ex-World Bank Chief Economist Justin Yifu Lin, it addresses issues such as industrialisation, employment dynamics, conservation, governance, and peace and security, all in the context of changing China-Africa relations. Download the set of essays here.