Thursday, January 2, 2014

Irene Sun: Chinese Businesses and Corruption in Nigeria

Irene Yuan Sun's analysis of Chinese Businesses and Corruption in Nigeria as published in The Guardian (Lagos), September 21, 2013. Here, Irene finds herself in a Lagos market, unexpectedly translating the negotiations between Chinese and Nigerian businessmen over the cost of importing a container of contraband blue jeans. She concludes this provocative article with this summary:

Many Nigerians have the impression that the Chinese are incredibly corrupt. I would make a slight modification: the Chinese in Nigeria are incredibly corrupt, because the Nigerians in Nigeria are incredibly corrupt.
What I mean is this: on their own, the Chinese are neither devils nor angels. They simply amplify the characteristics of the existing business environment in Nigeria. For now, this means that they aid and abet corrupt practices, because that is what individual Nigerians demand as the price to play in the Nigerian market. Unlike Western businesses or development institutions, the Chinese generally do not speak English fluently, so they cannot read the laws for themselves. Moreover, they are here to make money, not to take a stand for law and order. All of this means that the Chinese have the effect of reinforcing the status quo, and today, that status quo is the corrupt diversion of public monies into private hands.

As this textile importation example shows, for Nigeria’s business environment to improve, it will require not only passing thoughtful legislation, but also honoring those laws in everyday practice. But the power is in Nigeria’s hands. The Chinese will go to great lengths to do business in Nigeria; today, they brave murky laws, shady characters, and underhanded practices to play in this market.
Imagine what they would do if Nigeria cleaned up its act.


Unknown said...

Chinese and Nigerian business:There is no business like Chinese & Nigerian business!

It is an informative article but with a completely erroneous conclusion that Ms Irene Yuan Sun could have avoided by scanning the Nigerian Guardian slightly better. ...

20 years ago I read for the first time an interview with a Western manager who came back from China earlier as foreseen. His Chinese project was running smoothly and the journalist from "De Standaard” asked him why he came back; Greed! Anywhere and at any level an unbridled greed that I no longer could handle! Was his only explanation.
And he was a German manager of BASF (or Bayer) Antwerp, renowned for their hard style management.
Never has a country been condemned because of the conduct of a "business first" politics, on the national or international level.
But China is a particular case; this business friendly politic are imposed by a communist party and this is accompanied by a level of corruption that for a long time was the privilege of non-communist countries. And this drive is worldwide put forward, not just in practice, but now also as a theoretical alternative to Western democracy….

But indeed, on the level of economic relations between China and Nigeria, this is a marriage made in heaven as this article from The Guardian shows:

"In terms of pure volume, the countries with the biggest illicit outflows in 2011 are those with relatively large economies; Russia tops the list with $ 191.14 billion, followed by China with $ 151.35 billion, and India with $ 103.91 billion. In Africa, the largest economy, South Africa, was the worst offender with $ 23.46 billion in losses. Next is oil-rich Nigeria, where corruption cost $ 12.89 billion. "

The second most corrupt nation of Africa falls into the arms of the second most corrupt nation of the worldl!
And when many Nigerians considers "China Inc." as more corrupt, this means only that "China Inc" plays in a different league. ...
And just this corruption is one (of the many reasons) for the booming Chinese-African trade.
But this article in The Guardian has also a conclusion. This time one I agree with:
"This is nearly a trillion dollars that could have been used to help pull people out of poverty and save lives. Without concrete action, the drain on the developing world is only going to grow larger, "said Le Blanc."

Guardian News Website - ‘Nigeria, others lose 6.7b to corruption, trade malpractices

Poor Mr Brian Leblanc. But he is only a co-author of this report and an economist at Global Financial Integrity, a research and advocacy organization based in Washington, D.C., an organization which, by definition, doesn’t understand the essence of doing business….

Anonymous said...

Re: particularly your last last sentence - I guess if your 'essence of doing business' amounts to greed piled upon corruption piled upon greed piled upon infinitum, then yes, I guess you're right, since that's where your values and worldview lie.

Anonymous said...

The Mr / Ms Unknown above obviously has a very large axe to grind

I have been to many countries to do business, and yes, China's corruption is one of the worst - but to say that China is the *2nd worst corrupted countries in the world* based simply on the amount of "illicit outflow" (I do not even know if the figures quoted by _The Guardian_ is legit since there is no way to gauge) is not only factually erroneous, it is utterly silly

I *CAN* point to you other countries where the corruptions are actually being written into laws, if you want

Deborah, you can do better than letting this type of 'axe grinding' exercise going wild in your otherwise exceptionally informative site