Wednesday, September 7, 2011

World Bank Pushes (?) China to Offshore Manufacturing to Africa

Robert Zoellick hugging panda. Credit: AP
World Bank president Robert Zoellick has taken on the idea that China is restructuring, and that some of the lower-end manufacturing jobs will be going abroad. Why not to Africa? As readers of The Dragon's Gift know, the Chinese have been thinking about this at least since 1984, and have put a number of tools in place to help make this happen (see Chapter 3: "Going Global").

In a recent YouTube video, Bob Zoellick elaborates on his efforts to engage Chinese officials to take "practical steps" on this. I wonder if he knows he's preaching to the choir?

A hat tip to Henry Hall at China Africa News. He's made his site a go-to place for current events and analysis.

Monday, September 5, 2011

Chinese Workers Build Infrastructure in India

photo credit: Deborah Brautigam (c)
Catching up again -- over Labor Day -- I read a fascinating article by Rama Lakshmi from the Washington Post: "Chinese Workers Fuel India's Staggering Infrastructure Boom," (October 24, 2010). What I read could have come from many parts of Africa. And in particular, it reminded me of towns I visited in Eastern Nigeria where Chinese teams were working with Nigerian workers to construct factories for Nigerian owners. It puts the widespread use of Chinese workers in Africa in international perspective.

Takeaway Points:

(1) Skilled Chinese workers can be effective trainers:
Perched precariously on scaffolding, several Chinese workers showed Indian laborers how to weld the shell of a blast stove at a steel plant construction. Step by step, the Indians absorbed the valuable skills needed to build a large, integrated factory from scratch in record time.... "This factory is a classroom for Indian workers and we will create a benchmark for speed, quality and cost," Singh [the company's director] said.
...The Indian workers are learning a new work ethic from the Chinese and are now more punctual, not stopping work to take frequent tea-breaks or gossip, managers said.
(2) While India has a labor surplus, low level workers lack appropriate skills.

"India may be an IT superpower ... But the biggest gap is in the availability of skilled electricians, carpenters, welders, mechanics and masons who can build mega infrastructure projects ... Most of these workers have to be trained on the job. And that often delays the projects and makes them more expensive."
 (3) The ratio of Chinese to Indian workers: at one factory site (under construction) was 1600 Chinese supervisors, technicians, and other laborers to 5000 Indian workers, or 25:75.  This is fairly similar to the 20:80 ratio I've seen, on average, in Africa.

(4)  Speed, as well as skill, is the great China advantage.
The Indian workers earn slightly less than the Chinese, whose speed ultimately brings down the cost of the project.... The steel plant is expected to take 18 months, a rare feat in India. ..
These details provide one answer to the idea that vocational training may be all that's needed. Sure, it will help in building skills, but maybe not in building work habits. The tone of the article was refreshing: curious, balanced, informative, detailed. A hat tip to DH. 

Saturday, September 3, 2011

Zambian Economist Reviews "The Beijing Consensus"

The always interesting blog Zambian Economist reviews Stefan Halper's "The Beijing Consensus: How China's Authoritarian Model Will Dominate the Twenty-First Century." (This is the book my research assistant said "makes China out to be rather scary"). Halper's book repeats a number of China-Africa myths, including the one about China giving Malawi $6 billion in aid. One day I might also review it, if only to point these out, but in the meantime, an excerpt from the Zambian Economist review:
...Taking Zambia as an example, it is not obvious that we would necessarily be better in terms of democratic outcomes without Chinese influence. Beyond the perverse economic plunder of mineral resources (which is primarily western led), it is difficult to argue that in terms of governance, the 1991 – 2001 period  under IMF / World Bank overlord were necessarily better than 2002 – 2010 period under increasingly Chinese control of Zambian interests. Indeed The Beijing Consensus does acknowledge the flaws and inevitable downfall of the American led "Washington Consensus". It therefore begs the question what these "western values" and practices being eroded are. Is it merely American dominance, for better or for worse?  For many poor nations there’s little difference between a Beijing dominated world and an American one. Similarly, if we looked at the Zambian government’s policy it is unclear what the Lusaka government is learning from Beijing. The Beijing model is direct state led involvement in key strategic sectors and stricter requirements on foreign investments (e.g. in the car industry). That is hardly Zambia’s approach. Indeed when one extrapolates across other developing nations (e.g. Malawi, DR Congo and Angola) a similar picture emerges. Many of these countries are more liberal than Beijing, and where they are intolerant of democracy, it is because they have always been intolerant – not because Beijing has introduced it....
To read the rest of the review, click here.