Article by Dr. Daouda Cisse, Research Fellow at the Centre for Chinese Studies, Stellenbosch University, South Africa
On the 24-25 May, GIGA organised in Hamburg an international workshop on the role of companies from emerging countries in global norm-building on sustainability. Dr Andreas Noelke and I from Goethe University (AFRASO project) took part in the workshop where I presented my contribution related to the topic of China’s involvement in Africa’s infrastructure development that I summarize here.
In its engagement in Africa, China contributes to boost and diversify foreign direct investment. Such investments, at times are linked to development assistance (ODA), are directed to various sectors of the African economies; from the extractive industries (oil and mining), the infrastructure building to the services sector (banking, telecommunications, tourism, etc.). China’s growing presence in Africa’s infrastructure building sector raises questions related to norms and sustainability if one considers issues that China faces itself to deal with accidents related to the quality of its road and railway networks, unsustainable construction projects. The real estate bubble which particularly strains the major Chinese cities (Beijing, Shanghai, Shenzhen, Guangzhou, etc.) adds to the challenges of the Chinese government to avoid a real estate crisis after a burst of the bubble which would touch millions of Chinese citizens with low and middle class salary to acquire a shelter.
Chinese construction projects’ developers like other Chinese companies in various sectors have explored overseas markets. Such overseas operations enable Chinese construction companies to access more markets, create jobs for Chinese workers and acquire an international reliable reputation in the construction industry. However, challenges for Chinese investments also exist abroad. In many African countries, Chinese companies are involved in building hydropower dams, schools, hospitals, rehabilitating roads and railways, developing real estate projects, and so on. Concerns around Chinese investments in Africa’s extractive industries – more often – in sensitive and remote zones related to environmental and sustainable development issues have been hotly debated at the African and international level. For instance, hydropower dam building – which enables access to water and power generation for millions of Africans – by Chinese dam builders has, at the same time, caused the displacement of many people in Sudan, Botswana, Ghana and elsewhere living around zones where dams are built. Recently the president of Botswana has urged Chinese construction companies to respect local standard norms and regulations after noticing that some of those companies did not comply with policies put in place.
Proper planning for local needs is the third element. Chinese engagement in Africa’s infrastructure building development should meet the basic and immediate needs of the populations. One of the major Chinese involvements in Africa’s infrastructure building sector that has caught public attention recently is the construction of an entire new town next to the Angolan capital city Luanda. Nova Cidade of Kilamba has been entirely created by the Chinese state-owned China International Trust and Investment Corporation (CITIC). In China, the company has not only developed new towns with all the facilities around in coastal cities but also in inland provinces but they still remain uninhabited. The ‘ghost towns’ phenomenon from China is not new to the rest of the world. After similar projects in Southeast Asia, the United States, and Europe according to Forbes Asia (24/04/2013), Nova Cidade of Kilamba is the first of its type in Africa. With high rent prices and the vast majority of the Angolan population living in poverty, Angola’s ‘ghost town’ has not attracted people to occupy its 750 eight-floor buildings equipped with 12 schools and more than hundred shops. In a country like Angola which lacks of basic infrastructure and whose capital city is overpopulated, such luxury investment is not a priority. It does not satisfy the needs of large number of Angolans who do not benefit from the direct revenues yielded from the country’s important mineral resources. It is said that Angola has exchanged oil against this new town; the project was not a Chinese gift, but paid for with Angola’s national wealth. African officials mainly in resource-endowed countries should bear in mind that having infrastructure versus resources is not viable and sustainable at all in the long-run for their respective economy.
Chinese investments in Africa are an opportunity, but no guarantee for development to happen! African countries should be careful of China exporting its environmental and (un)sustainable development issues and now its taste for mega-projects like the ‘ghost towns’ through its investments in Africa. Priority should be given to needed infrastructure development and aiming at satisfying the populations’ needs for a longer term and sustainable development between China and Africa.