The victim of Chinese Politics: Africa
Africa can be recognized as a ‘privileged victim’ amidst the strategic political moves played by the world. These moves are definitely helping Africa to build a position for themselves in international markets but at a very, very very huge cost. Let’s see how?
Today, the hopes are high. Revisiting the days when Africa was rarely recognized in international trade despite being a warehouse of major natural resources, is history now. As a matter of fact, today foreign direct Investments into Africa have tripled, real per capita income has grown by about 40 percent since 2015 and regional educational capabilities showed some positive growth. The credit clearly goes to the ‘One road, One belt’ initiative by China, which is helping Africa to overcome its biggest hurdle in the path of international business expansion and lack of infrastructure.
Why did China do so?
Give us a minute and we will tell you why. But before that, understand what challenges was Africa facing. The irregular and unreliable access to electricity in African countries have substantially reduced the ease of doing business in the country for international companies, especially the electronics industry and manufacturing hubs which heavily depend on regular energy supply. Secondly, the incompetent ports and sparsely connected railway lines for trading activities limited Africa’s international reach and are not capable of supporting and transporting the bulkiness of natural resources. Adding to this, the illiteracy and the low skill index of human resources declared Africa a completely hopeless nation to trade or invest in for a very long time.
The major takeaway was that Africa somewhere failed to build and deliver its core competency as a nation having a huge geographical advantage. But, the question is that what will change in the upcoming decade? Political agendas related to Africa, and China’s growing involvement through the BRI initiative. Saturation of domestic markets can be another pull factor for investors.
Today, China is lending huge amounts of loans to African governments to help them build better ports and railway tracks which can support the transportation of Africa’s natural resources and bulky raw materials within its own country as well as to the international markets. China is helping them to realize their core competency.
On one hand, such investments are bringing African nations in limelight for being the next potential exporter of raw materials abroad while on the other hand, China is strategically dumping its excess steel production into Africa for their infrastructure development as China’s own market is fully saturated. The recent developments in Africa have also successfully attracted the interests of Indian importers and investors as India is a net importer of natural resources and Africa with its better infrastructure seems to be a good option to invest in. Within a few years, Africa has a good chance of being recognized as an emerging market like Asia, providing them with trade advantages under the GSP system. Brazil and Japan have also joined the gang as recent investors into the African economy while Americans have their own historical apprehensions.
But still, the African economy, education, and roads demand regular investments in these upcoming crucial years. Like the Middle East countries who enjoy ridiculous amounts of oil money, Africa has the potential of being recognized as the world capital for raw materials in upcoming decades.
Involvement of International Politics in This Situation
Till now, it is clear that the investments and FDI are on a rise in the country and the African territories are jumping up the indexes like Kangaroos. But nothing comes free of cost. Today, China is investing aggressively in Africa’s infrastructure to facilitate trade from African ports and is helping them to build a strong foothold in international business markets for upcoming decades. This opportunity to trade with China and other countries today should slowly and gradually act as a gateway for Africa to explore new international markets tomorrow, especially beyond China?
The current plight of Africa somewhere resonates to the poverty stuck Indian population who are recalled only at the time of elections. In this play, China is playing the minister’s role. Africa with its numerous countries can create a majority in the UN representation whose votes China desperately needs to legally annex Taiwan into the mainland of China and emerge as a superpower across the globe.
This intention of China is sugarcoated and communicated to Africans as Chinese efforts to revive the markets and the country’s infrastructure and Africans are falling for this bait. The enormous amount of loans provided by China to Africa at cheaper rates are mounting day by day. The trends and past experiences of other countries with China suggest that in a decade or so, Africans burdened under loans worth billions will be forced to pay China with their ports or railway lines, thus providing Chinese with complete access over their trade and scope in international business. The same happened with a Bangladesh port. African countries are looking forward to substantial growth in their international businesses in upcoming decades but
China seems to have some other plans for them altogether.
There is no denial of the fact that Africa will definitely be playing an active role in international business tomorrow but will that be Africa as a continent or as an economic undeclared colony of China? That’s what time has to tell.