Trade, Investment, Power and the China-in-Africa Discourse

Our arguments are threefold: 1) given the world system, it is difficult to assess the pluses and minuses of China-in-Africa as a single phenomenon; 2) as a player in the world system, China in Africa has more in common with the West than is usually acknowledged; 3) there are nevertheless notable differences between Western and Chinese presences in Africa; many derive from China’s experience as a semi-colony, its socialist legacy, and its developing country status, features which together make PRC policies presumptively less injurious to African sensibilities about rights than those of Western states. In what follows, we focus on PRC activities in Africa often denounced as harming African interests, particularly trade and investment. We also examine why the China-in-Africa discourse has emerged as it has and African responses to its main tenets.
About 47% of the oil China consumed in 2006 and 50% in 2008 was imported. PRC imports in 2006 were 6.8% of the world oil trade and supplied 12% of all energy China consumed, coal, hydropower and nuclear power being major sources of Chinese energy consumption. China’s 2005 oil imports from Africa provided 4% of China’s energy needs. Of the 31% of PRC oil imports from Africa, Angola’s share was 14%, Sudan’s 5%, Congo (B)’s 4%, and Equatorial Guinea’s 3%. African oil supplied 14.5% in 2006 and 16% in 2008 of all the oil China consumed, not much different from US imports from Africa of 13.2% of all oil it consumed in 2006?, imports that provided 5.2% of US energy needs. China imports oil largely to fuel its production: 70% of its demand is for industrial uses, while 70% of US demand is for motor vehicles. In 2009, China’s special envoy on African affairs put these figures in perspective when he noted that China receives 8.7% of Africa’s oil exports, while the European U-nion and the US each take 33%. China’s premier also stated that China’s investment in Africa’s oil and gas industries amounted to one-sixteenth of the total global investment in these industries. China thus hardly dominates Africa’s oil markets. The China-in-Africa discourse however presents the PRC as aspiring to be the chief taker of African resources and interested in Africa only on that account.

China does participate in an exploitative business: historically, the price of oil and other globally-traded primary products, relative to that of industrial commodities, have been significantly determined by asymmetries in political power. Apart from “unequal and disparate exchange” that affects oil and primary products generally, oil is capital intensive, creates few jobs, is environmentally damaging and corrupts producing states. People in oil-rich regions, such as southern Sudan and Nigeria’s Niger Delta, receive so few benefits from their patrimony that violent conflict has ensued.

China is in Africa for oil because 80% of the world’s proven conventional (non-tar sands, non-shale) oil reserves are state-owned and account for two-thirds of oil production. Most remaining reserves are sown up by Western oil firms. China takes oil in Africa differently than Western states: it often packages oil deals with infrastructure project loans. From the 1970s, developed states and international financial institutions (IFIs) largely abandoned African infrastructure projects, which also receive little private and almost no public-private financing. International investment in infrastructure in Africa amounted to 4% of all such investment outside North America from 1992-2003, even though lack of infrastructure is blocking Africa’s development.

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