Dr Alex Vines OBE
Good morning, good evening, good afternoon. My name is Alex Vines and I’m the Director of the Africa Programme at Chatham House, but I’m also the Managing Director for Ethics, Risk & Resilience. I’m very delighted today to be hosting a great panel, talking about Africa-China Relations – Short-term Gains or Longer-term Goals?
But the China-Africa relationship has been discussed very thoroughly over the last decade. It’s becoming a – very much a focus of international attention again, partly because of the COVID-19 response, and where China sits, in terms of COVID recovery for the continent. So not just in terms of the benevolence and charity and humanitarianism of China in responding to the virus, but in terms of economics, too. So, I know our panel will be talking about debt, for example. African countries have been very exposed, some of them, to debt, including to China, and so that’s an issue.
The China-Africa relationship is an increasingly deep one. We saw, at the forum on China-Africa Co-operation in 2018 in Beijing, that more African leaders visited Beijing than they did to the UN General Assembly in New York. So, it just goes to show the interest at high level at the partnership with China, and, indeed, the next FOCAC is next year, 2019, in Africa, in Dakar. And so, China will be watched very closely on what its commitments are to the African content – the African continent, in terms of economic support for post-COVID recovery. There are some scholars and analysts who think that China will pull back a bit from Africa because of the impact on the global economy by the pandemic.
This meeting is fully on the record, it’s being recorded and, for those of you that have joined us, when we get to the Q&A stage, the question and answer stage, please send in your questions to me. I will read some of them out. I have the chatline, but if we have time, I will maybe also invite you to read out your question, so unmute your – we will help to unmute you and, indeed, if you want to turn your video on at that stage, we might see if that’s possible.
With no more ado, I think we should now move to our first presenter, and I’m very delighted he could join us, that’s Eric Olander. He’s the Managing Editor of the China-Africa Project, an independent, non-partisan, multimedia news initiative, dedicated to exploring every facet of the Chinese engagement in Africa. Eric’s had more than 25 years of journalism experience, including working for CNN, the BBC, associated press, and others, and you should all know that he’s fluent in Mandarin, and has an undergraduate degree in East African History from the University of California in Berkley, but he’s also got a Masters of Public Affairs from the University of Hong Kong. Eric, I’m really delighted that you could join us today, and I’m very much looking forward to your reflections on Africa-China Relations – Short-term Gains or Long-term Goals? Eric, over to you.
Eric Olander
Wonderful. Thank you so much, Alex, and thank you, Chatham House, for inviting me today. It’s really an honour to be here, obviously with Professor Haifang Liu, who is really one of the great Professors in China who follows African affairs, and Jacqueline, as well, who we’ve had on our show, so it’s – this is really going to be a special treat for me to hear what they have to say.
Good morning, good afternoon, good evening, everybody. Let me start by saying, very quickly, that my objective today, and I hope you walk away from this discussion more confused than when you came in, and that seems counterintuitive, but our objective today is to actually confuse you. And the reason I say that is because a lot of people approach the China-Africa relationship with their mind already made up as to what this relationship is. China is the worst thing that’s ever happened to Africa, and they will have all of the datapoints lined up, all of them that are true, that prove that the debt is unsustainable, that the environmental pollution is too much, that the illegal labour is too much, all of that. Everything about that is 100% true.
Other people will come to the discussion, convinced that China’s the best thing that’s ever happened to Africa, and everything that they too say would be true. The fact that Huawei has connected the entire continent, in the time that I’ve lived in Africa and China, I have seen the connectivity just skyrocket. The fact that it broke the relationship, the dependency that Africa had on Europe, and gave people choice. The fact that the infrastructure, which was so badly needed, and that the United States and Europe failed to provide for decades, in terms of financing and support, is now there. Those are all good things. But the point that I try to make is that the good and the bad in the China-Africa relationship sit side-by-side, and if you’re someone who is convinced of either one, generally speaking, I find that you’re missing half the story. So, let me just, kind of, put that out there, that people can see what they want in the China-Africa relationship, and I tend to think that it’s far more complex than most people give it credit for.
Let me give a few talking points about where we are today that will help inform our discussion and then hopefully, we can bring up some of these issues, when it comes to the Q&A. Very quickly is that most people look at the China-Africa relationship in economic terms, largely because that’s how Africa has been positioned in the global economy for four to 500 years, and China’s early engagement in Africa was very much motivated by economics, and a very classic type of relationship. So, in the early 2000s, when then Presidents Jiang Zemin and Hu Jintao, kind of, started to develop the China going out process, Africa presented a wonderful opportunity because it had a low barrier of entry, the US and Europe and the great powers had largely disengaged, and there was real opportunity to take advantage of market entrance that they couldn’t do in other parts of the world.
Now, for the 15 years after that, it really followed a traditional trajectory, and that meant that China was extracting oil, mineral, and timber, and that represented the bulk of what Africa sold to China, but it’s changed now, and I make the contention that is quite unusual, that Africa really isn’t that important to China anymore, economically. Let’s remember that China’s a country that does $4.14 trillion in global trade. This year, we’re expecting Africa and China trade to be somewhere about $180 billion. So, by any definition, that is what we call SOFA change. It’s insignificant. If Africa disappeared from China’s trade balance tomorrow, nobody would know.
And the fact is, too, keep in mind that what China used to buy from Africa, oil, mineral and timber, now it has the Belt and Road, and it is diversifying its sourcing of those things. Do, back in 2008, 30% of Chinese oil came from three African countries: The Republic of Congo, Sudan, and Angola. Fast forward to 2018, ten years later, and less than 20% now comes from just one country, Angola, and that’s been going down as China now relies more on Russia, the Persian Gulf, the United States, and Brazil for its oil. Remember that China does a third more trade with South America than it does with Africa. So, economically, it’s becoming less important.
Now, what does that mean for the China-Africa relationship? That does not mean that Africa’s not important. In fact, I contend that Africa’s becoming far more important to China, but in political terms. Africa’s the largest voting block at international organisations, the coalition that now rallies behind China on contentious issues like Shin Jung and Hong Kong that signs these letters is incredibly important. Backing organisations like the World Health Organization, it’s rallying against the United States on issues like Huawei, incredibly important. So, again, this is a relationship that’s very much in flux. If you are bringing an old mindsight, a 20th Century mindsight, to this geopolitical relationship, I think you’ll be sorely disappointed because it certainly doesn’t fit that paradigm.
Very quickly on debt and then I’ll – just to put this out there. Many people say that Africa has a debt problem with China. Africa does not have a debt problem with China. We just need to be abundantly clear about that. About ten African countries have a debt problem with China. That leaves about 44 other countries that do not. So, I think it’s really important to make sure that we are precise with our language when we’re talking about contentious issues like debt. So, Djibouti, Ethiopia, Kenya, Angola, Zambia, they all have very serious debt issues, but many other countries on the continent, the majority of other countries on the continent, do not, so we can talk about that, as well, and I look forward to our discussion.
Dr Alex Vines OBE
Thank you very much, Eric, and we will have plenty of time for discussion. And a reminder to those of you who are – who have joined us, this is fully on the record, and you have the opportunity to ask questions, so please send your questions, or, indeed, your comments, through the ‘Q&A’ box. I’m now turning to Jacqueline Musiitwa, she is an International Regulatory Attorney. She previously served as the Chief Advisor for Corporate Relations for Africa & Ventures at Rio Tinto, and in various capacities at the Eastern and Southern Africa Trade and Development Bank, at the World Trade Organization. She’s also worked at the International Financial Corporation, Microcred Africa, and has worked also on various other organisations, including serving on the Board of the International Rescue Committee in the UK, and has been on the Board of the Bank of Zambia, which clearly is a tough job, if you’re on that board quite right now. Jacqueline, thank you for joining us. I know you’re in South Africa. Please unmute yourself and I look forward to hearing from you. Jacqueline.
Jacqueline Musiitwa
Thank you so much, Alex, and thank you so much to Chatham House for the opportunity to speak today. I think just going on in addition to what Eric said, I think my points will really be around the ongoing relationship in China, and more so the image. Because I think a lot of what we are seeing in the China-Africa conversation is really about who’s shaping the narrative of China and Africa, and whose narrative ends up becoming stronger than the other.
And I think if we start with the most recent example of COVID, I think that it definitely reveals how we view the China-Africa relationship. So, COVID has really negatively affected the continent. We’re looking at a GDP growth for – of 3.2% this year, and – or starting at – it was at 3.2 and now has fallen to negative 0.8. And we’re also starting to see more conversations around debt, as Eric mentioned, and debt restructuring, but now, not only a debt reconstructing conversation about private lenders and multilateral lenders, but, once again, the conversation has really now narrowed down to what is China’s role in this ongoing debt debacle and who has a higher stake, China or the multilateral structure as we know it?
And so, I think that, as we delve into that question, the question is also who’s telling the story? Is it western media looking at it, is it African media, or is it Chinese media? And I do think that, because a lot of the media focusing on the debt conversation in Africa has been western media, the conversation has tilted negatively to saying that China is now responsible for African debt, which is not the case. A lot of the countries now that are dealing with restructuring, and potential default in the case of Zambia, already had serious economic issues before COVID hit. And, when COVID hit, it was a matter of how do we best manage our economies, and unfortunately, there just wasn’t much legroom for a lot of these countries to really wiggle?
And so now it is the requirement to restructure debt and have conversations around what next in their economies, and China is an important factor in that, but I also think that, besides China being an important factor, it does come down to historical lenders that are not necessarily – are – historical lenders, pardon me, that are willing to have conversations, but are sceptical about what China may or may do. Now, China definitely has not been transparent, as far as whether or not it will, one, forgive debt, two, delay debt, but I do think that, once again, it’s an ongoing narrative question that we do need to look into.
I think, following what Eric also said about Africa’s relevance, Africa’s relevance is definitely diplomatic, and, besides its engagement at the international level, I do think that Africa’s diplomacy also comes down to, you know, media, and where Africa can positively reflect China’s image. So, we’ve seen cases where – for instance, the issue of South China Sea, where African countries have come to China’s support, not in multilateral platforms, but in media, really saying that, you know, that area of the world is China’s, rather than other countries.
We’ve also seen [audio cuts out – 16:03] engagement at the WHO when the US decided to pull out there, and African countries, which obviously are receiving a lot of COVID-19 aid from China, have supported China’s increased participation at the WHO. The narrative that came out of that was really, this is China’s opportunity to become an even stronger world leader than it has been, to play a greater role in multilateral engagements than it has, and once again putting the US in second place there.
I think the last is really Africa’s role in being what I would say a pawn between US and Chinese strength. As the US and China continue to engage in their own problems, Africa definitely comes in as a battleground of sorts. As China increases its investment in Africa, the US has tried to counter that in many ways. The question is, are US tactics right now really able to counter the Belt and Road Initiative, the COVID relief initiatives, all of the infrastructure investment that has come in, in the past ten to 15 years, as well as the goodwill investment, for instance the stadium and the like? I think that that is a story that, once again, will be retold, depending on who really comes out the winner in the US election. So, those are my few opening remarks, but I look forward to conversations with the panellists, as well as everyone attending. Thank you.
Dr Alex Vines OBE
Thank you very much, Jacqueline, for your presentation, and, indeed, for drawing on the relevance also of the result of the US elections, even for this conversation, and how we move forward there.
So, our final panellist is Professor Haifang Liu. She is the Associate Professor in the School of International Studies at Peking University in Beijing. She also serves as the Executive Director and General-Secretary of the Center for African Studies at Peking University, and is the Vice President of the Chinese Society of African Historical Studies. She has worked at the Chinese Academy of Social Sciences, CASS, at the Institute of West Asian and African Studies, and served as a Visiting Scholar at the Institute of African Studies of Carlton University and at the Institute of Social Studies in The Hague. Thank you, Haifang, for joining us, and, please, over to you.
Professor Haifang Liu
Thank you, Alex, for your very kind introductions, and also, thanks to the whole Chatham House teams to bringing me, to really giving me such a chance to interact with colleagues from everywhere. I can see now we’re literally coming from different continent, and then to – during the still – COVID is still ongoing and having such a opportunity to really exchange, it’s really great.
My remarks, as the opening part, I want to suggest to maybe add on to what Eric and also Jacqueline already talked about several angle. I want to bring some – maybe you can call the Chinese perspective or I would rather say it’s an insider that, as a scholar living in China, working in China, can have a more properly information from the bottom up, or just from top down. This different kind of level to reflect some of the Chinese perspective.
And one things I want to suggest, the COVID does create lots of a problem, like everywhere, both to China and Africa. I think, during this COVID, between China and Africa, we have seen increased solidarity, even we do reflect that what happened in Guangzhou, as Alex just briefly mentioned the bad side, but for me that’s just a – kind of, a learning process, if before it reflected rather the neglect since or ignorance about the people-to-people exchanges, and then the two sides has been really visible, once the economic co-operations, but then this people-to-people exchange has been rather weak.
So, this created a problem and that in Guangzhou we know that the policymaker wasn’t a problem, but the more important thing might coming – really coming from the public, their lack of understandings of each other, and also, those kind of a politicals of a fear, that play a role during the COVID specifically, if we remember that, for those restaurants or for the hotel, the reason they refused the Africans to stay on, to visit them, really coming from the fear that Africans are the virus bringers, again because China was just getting better during those moment in April.
So, for me, this really reflect a big neglect, a big lack of – for the bilateral co-operations, which is the people-to-people exchange and, thereafter, we have seen lots of efforts, both from Chinese side and the African side, they’ve tried to increase. From African side, in China, we have seen many, many of African youths who graduated or not yet graduated, but still working within Chinese campus. They have, sort of, linked up and then organised lots of exchange platform, and me, myself, helping engage them for many time, over this kind of exchanges. Though, this kind of a platform created a long time before, but, unlike lately, specifically during the COVID, people have more need and have more – this kind of a tendencies to exchange over – online or virtually.
So, this has been really useful for two sides to understand each other, and then you can say the momentum, more people are to really get to know each other better has been ongoing, and also, from Chinese side, the incentive from government is increasing, like scholarship, like lots of culture platform, and also from non-governmental levels, so we also have, say, lots of universities creating more African study programmes, and then, those kind of very true feelings, true tendencies to learn more about Africa is very important. This is one things I want to reflect, just to add to the previous speakers.
The other things I also want to in respond to what Alex in the beginning just raised, how – and not only the China have provided, I mean, both from governmental levels and also, from non-governmental level, as we have seen, like Jack Ma’s Foundation, three times he provided very generous supplies for PPE, and also, the many, many Chinese entrepreneurs staying in Africa also provide has been such a hand for humanitarian helps.
But, on the other hand, as refle – as Alex reflect, maybe we can also talk about whether China can be an economic researching tool. So, for that sense, I have seen actually, on one hand, we do say lots of the Chinese traders, or lots of the Chinese SMEs staying in African continent, they’ve become, kind of, a very important part of the changes, just immediately provide the productions for PPE, for specifically masks, and then, also, there are lots of Chinese companies, they didn’t stop their productions. So, immediately, at this moment, we have seen some of the project already finished lately.
And then, on the other hand, I also want to say this is not immediately coming from COVID or only during the COVID it started. Actually, it goes to PRR. When Eric was doing his presentation, he rather think China, economically – Africa, sorry, Africa for China economically not that important, but I don’t agree with you because if we’re coming from this investment perspective, because in terms of China’s own need, we don’t need to reflect again about what Professor Jacqueline has reflect about China’s offshore need, its industry, how it need to upgrade.
But, on the other hand, for myself, since 2019, because the PRR only announced that 2017 African was invited as construction patterners of what we are. But, for me, before that, this kind of incentives already happened and lead to an increase in more Chinese investment already happened in China – in Africa a lot, from both state-owned and the private investment. And, with that, PRR play a more important role as a signal to show the – to the Chinese and progress this is definitely still one of the very strategic pillars for Chinese business co-operations.
So, with that, we have seen that this different kind of investment have significantly increased and be it coming from SEZs or industry pack or agriculture pack, there are lots of this kind of a – lately, just for recent years, they increase and, during COVID, I think Chinese investors learn another case, learn another truth, that maybe to go to US in the West is difficult. It’s much more difficult than you go to invest in Africa. So, those – you can call it so the older sense of solidarity or it’s just a kind of lessons that the people have learned in any way the idea to increase the investment in Africa, become a new momentum.
So, for me, they will become a very important force for Africans’ economic research, and the latest, yesterday, the example opened again and we know that last time the Kenyans already successfully brought their avocado to China to sell in – to be sold in Afri – in China. For me, this is just a example. If African does have a long-term strategy, they want to harness Chinese opportunities. The platform that be PRR and the other initiative that have build up is just there. Ut’s up to African side to work on their strategy and then to harness China and then, you know, all this platform to gain from this collaborations. I think I’ll just stop here as the opening remarks, and then I’ll wait for more questions then and a comment. Thank you.
Dr Alex Vines OBE
Thank you very much, Professor Haifang Liu. Very, very helpful. Some of your comments about China and thinking and wanting the Africans to define their own strategy towards – collective strategy this is, towards China is very interesting, and, kind of, echoes actually what the discussion is within the European Union about preparing for its next summit on the EU-AU relationship and wanting a better defined collective interlocutor. So, there are similarities on some of the themes that you’re raising with what’s being discussed within Europe.
So, please – we have 200 participants, please don’t be shy to put comments or questions. We have three excellent panellists, so use the Q&A opportunity. They’re here and captive for you for the next 30 minutes, and I’m going to, kind of, cluster questions that I’ve seen, and, if there are moments of quietness, I have some questions of my own. Look, we’ve got – I’ll ask all three panellists to respond briefly to these questions. There are several clustering around debt.
So, for example, Katherine Pye has asked, “Do the panellists think it is possible or probable that China and the Paris Club could work together to form a more permanent new mechanism for debt refinancing? There is a lot of talk about how the infrastructure and debt is not fit for purpose and how could it be remodelled, and how can – can China work with the Paris Club and others?” So that’s one question to the panellists.
Another debt question is from Joe Bavier, so Joe asks another question, which is “What can the panellists say about the current and likely future influence of the IMF World Bank and Paris Club in Africa? COVID has exposed their inability to deliver meaningful debt relief. A new [inaudible – 31:15] seems unachievable and Zambia’s debt crisis has shown that the players that countered China and Eurobond holders. Yet, at the same time, many countries have become more dependent upon the IMF and World Bank relief during the COVID crisis because they could not access debt markets.” So, two interrelated questions on debt, and I’m going to go through the panel, starting with you, Eric, for your thoughts, then Jacqueline, and then Professor Haifang Liu.
Eric Olander
There is…
Dr Alex Vines OBE
Eric.
Eric Olander
…a very stark misunderstanding about China’s engagement in the G20 DSSI, that’s the Debt Service Suspension Initiative, and it causes a lot of confusion. Chinese President Xi Jinping came out very early on and said, “We’re going to work with the G20 on the DSSI,” and everybody went, “Wow, that’s amazing,” and Diplomats up and down the continent from Chinese embassies are saying, “We’re working with the DSSI.” Here’s the catch. The Chinese are working bilaterally through the DSSI with different countries. They’re not working multilaterally with the other members of the G20.
That is the reason why people like David Malpass at the World Bank, that is the reason why the IMF and others, are increasingly frustrated that they’re not going the co-ordination, transparency, communication from the Chinese on the DSSI. So you will hear two very distinct narratives going on right now. One is the Chinese narrative, saying, “We are working on the D – working through the DSSI, everything’s great.” You hear this over and over again, and it causes a lot of confusion.
In – technically, yes, they are, but, again, the conversations in Zambia are the perfect example, and in Angola, as well. Those have been bilateral conversations between Chinese stakeholders and Chinese creditors, and Angolan and Zambian borrowers. It has not been through a multilateral process. Meantime, the 19 other members of the DSSI are more – or of the G20 are more or less in the dark, and this is one of the reasons why we’ve not had the kind of communication and resolution to the DSSI that a lot of people have expecting, and it’s a real point of miscommunication, in terms of what the expectations are, in terms of that.
The – let’s be very clear hear about the language we use ‘cause it’s very important here. The G – the World Bank, the IMF, the Paris Club of lenders, have been unwilling to make this happen. It’s not they’re incapable of doing it. They have been unwilling. It’s an active point that the United States has not expanded the special drawing rights at the International Monetary Fund. That is not by accident or some passive thing, that is a conscious decision by the United States Government to not expand the special drawing rights. That’s been a key request of African governments and finance ministries to provide them liquidity, which is a major, major problem.
The fact is that African governments have been asking for two to $300 billion of support and also, debt cancellation, none of which has come forward. What the D – the G20 and the DSSI has done is literally nothing more than the bare minimum, and for that, all of the parties are responsible for that, so deferring debt for another six months really is pathetic, and they’re all accountable for that. And if there is the crisis today, it’s in part because of some African mismanagement, as we’ve seen in Zambia, but so much of what’s happened, in the past six, seven, eight months, is not the fault of African finance ministries because they, in many cases, were managing their finances quite well. This is things that are far beyond their control, and the fact that the World Bank, the G20, the IMF, the United States, and the Paris Club of lenders have not found the political will to do something, to me, they should be held accountable for that.
Jacqueline Musiitwa
And private lenders, but I really do think, at the end of the day, because it is African countries that are suffering this debt, they will have to do what is required to get over this hurdle. And so, if it means negotiating bilaterally with China, that’s fine, but I do think parallel conversations need to be happening with the US, as well as other members of the G20. Because, besides them negotiating in a group, I do think that this does come down to bilateral relationships with individual countries and making sure that individual countries are convinced of what the African plan is, and once the debt is either, one, delayed, or forgiven. I think most countries right now are going for the delay just because right now COVID has hit so hard, but there are also conversations about debt forgiveness, and I do think that that becomes a country’s relationship matters with the country it’s negotiating with, and so I do think African countries will need to increase that engagement.
Now, having said that, there’s also a – there’s also, kind of, this, I don’t know, dynamic, if I can call it that, between the mistrust of the Paris Club lenders, and I do think that, at one point, we will need to get to a point where everybody is sitting behind the same table, to the degree possible, and just have a conversation about what next? A lot of the private lenders, so the Eurobond holders, have not revealed their cards as much as China hasn’t revealed their cards, but, at the end of the day, going back and forth really doesn’t help anyone. And African countries need to come to some resolution quickly, in order for them to also deal with other pressing health and economic issues that COVID has exacerbated.
And so, right now, I think there just needs to be more transparency in general, to the degree possible, to make sure that Africa finds a solution, not only for the short-term, but also for the long-term, because all of this is going to reverse Africa’s development in many ways. A lot of the progress that was made on the SDGs is already being reversed, a lot of the issues around climate change are only getting worse, and so, I think we just need to go ahead, set deadlines for negotiating debt, and try to find solutions and next steps for moving forward.
Dr Alex Vines OBE
Quick question to you, Jacqueline. The Presidency of the G20 next year is Italy, and the G7 Presidency is the UK. What do you think they should be doing in their Presidencies around this issue?
Jacqueline Musiitwa
I think in particular for the UK, that has very strong relationships across Africa, I do think it’s an opportunity, after we’ve, kind of, dealt with the debt issue, to really talk about what next for development? And I do think a key for what next is really around trade and strengthening trade relations between Africa and the rest of the world. Eric earlier said that, you know, Africa is not significant to China from an economic perspective, and I think that we need to change that. I think that there is an opportunity for African countries to become greater trade players around the world, and I think, now that we have the African Continental Free Trade Agreement, that is the opportunity really for Africa to demonstrate its strength with trade moving from only raw, natural resources, and, kind of, moving up the production chain.
And so, I think the same for Italy, Italy may not be as sympathetic to some of the debt woes in Africa because of its own issues, but I do think that, moving forward, it is a good time for Africa really to step up on a trade perspective. Especially I hope that, if Dr Ngozi Okonjo-Iweala becomes the Head of the WTO, we will start to see a shift in conversations around trade for LDCs. So, not only African countries, but LDCs in general, and how to strengthen them within the global trade regime.
Dr Alex Vines OBE
Thank you, Jacqueline. So, Haifang, you’ve heard the discussion, and Eric, right at the beginning, reminded us that, in terms of really serious debt exposure to China, it’s probably ten African countries, of which obviously a very significant one is Angola, which has 2.2 billion at least debt to China. So, I wonder if you could reflect a little bit, in terms of those ten, and how China’s going to handle them, and also, obviously, Angola? You are the only Chinese scholar that has written a book in Chinese on Angola, so where do you think that relationship is developing, in terms of the debt exposure and its importance for supply of oil to China? Thank you.
Professor Haifang Liu
Thank you, Eric, for really guiding or, you know, specific – specifying my questions and my answers to this bigger questions about that. I think, yeah, just as you said, to reflect about how China does think of or not – if not, when China or maybe different kind of a Chinese stakeholder perceive this kind of a debt issues. I want to add, for number one, I think, generally, from Chinese governmental perspective, it’s quite vulnerable, why this suddenly such a big debt narratives pop up and then, like, form bomb in China, you know, and then trying to, sort of, stop this kind of a co-operation. Yet China wasn’t, you know, involved in any kind of Africans debt issue before, before even – not too early, at least, like you suggested, Angola’s case, only since they won their case, a little bit more their case ago.
So, in terms of Africans’ debt issue, it’s quite a long problem, since 70s up ‘til, you know, such a long time, and then China wasn’t there, and why China should observe, should really follow what Paris Club have suggested. So, there are lots of this kind of a debate, this kind of a discussions, and then, if you are trying to look at the structures of each countries, the ten countries that Eric’s just suggested, for the structures, even China’s new – so-called new debt, and maybe – for that country, maybe a bit shocking, but the larger portion is still mainly coming from traditional donors, traditional lenders. So, in that way, China failed just why I am taking – I – why only talked about the China’s role, if we find a solution, there should be a joint reflection – joint responsibilities, so that has been in the – within China, what the people have discussed.
And then, the government attitude currently has been really trying to encourage for those what they suggested to be forgiven really quickly finished, and for the rest that could be suspended, also need to be suspended, gradually. And I know yesterday, the day before, we – a group of Chinese scholars, we have very in-depth discussions with the Chinese officials, some also touch upon this debt issue. I think this is quite clear that the policy was very obvious. If China has promised to use this G20 suspension platform, then China will definitely fulfil this responsibilities.
So, even though, as Eric suggested, that there are, kind of, a bilateral way, but if we also reflect on what China feel it was quite vulnerable, as a so-called southern country, started in 2000 to work in a new way, a new relationship with African country, it’s totally different kind of collaborations. And then, even with Angola, after the Civil War, to try to test, to try to find some new way of, you know, helping West Africans that really post-conflict of reconstructions.
And then China definitely very much believe in the philosophy that China has passed itself, the so-called [mother tongue – 44:25], Eric understood very much, obviously you only have to have road and before you get richer, and also, the peace, finally, will only come in from economic development. So, China, so far, the – in terms of financial issues, lots of this kind of mechanism you can say that really learn from its own experience. Firstly, to encourage lots of companies to use this kind of mechanism incentives to come in, to build up infrastructure.
So, I want to just suggest it’s not only for Chinese Government, also for those Bankers, for those Chinese companies, they are also learning. They need really to take the lessons from their experiences for two decades in Africa, as well. The Bankers now reflect a lot about, you know, the – when government suggests that you have to suspend enough, suspend the debt, and then, the – lots of companies, construction companies, with those kind of incentive, coming to Africa, they now, sort of, attract because there are lots of a project who couldn’t be implemented at all. So, for nearly a year’s time, they had nothing to do, and they detracted there.
So, as long as they still stick with the older way to using this kind of a Chinese Government incentives to use this kind of a – what we call like the Angola model, to really just to make sure the Chinese concession alone can guarantee their profit, then they will still attract there. So, those are smarter ones, smarter companies, be it state-owned or those SEZs, the private one. They have learned very quickly, they trust for a – several years ago already trying to invest differently, and they very diversified their existence in Africa. So, for me, each stakeholder now learning and then trying to identify some solutions for this issues.
Dr Alex Vines OBE
Thank you, Haifang, we’ll come back. Wo, we’ve got about 15 minutes more and lots of questions, so I’m going to try and get through a few clusters. There’s one – well, there are two questions that hover around the issue of local content, basically, so, employing Africans. So, for many years, a criticism has been of Chinese investments that they have often been about creating employment for Chinese. You mentioned, Haifang, Angola-mode, you know, so exporting oil and resources from Angola in exchange for infrastructure from China, which was built by Chinese. So, the question remains is, “Are Chinese companies learning from those past mistakes of engagement in previous decade, to now provide much more opportunity to create African jobs?” And we had a question around this from Matino Chachuwa, who’s in Botswana, for example.
I also have another question, which is about the quality of data, so Muthoni Wanyeki, who’s – who, I think’s in Kenya at the moment, Muthoni was asking “What’s the best source of information, figures on public lending to Africa, plus also figures on comparative Chinese migrants to Africa, and African migrants to China?” So, that’s another question. And then, Laura Morrison, who is in the United Kingdom, I think, or may be in Ireland now, Laura is asking, “Which African countries would cite – would you cite as being particularly effective in relat – in their relationships with China politically and economically?” So, which African countries have agency and actually impact China more than maybe China impacts themselves? So, those are the questions that I have. One is about local content, one is about data, and one is about African agency and China. So, let’s go to the panel again. If you can be concise this time, so we might have one more round of questions after this. Eric, over to you.
Eric Olander
I’ll take one of those, which is just…
Dr Alex Vines OBE
Yeah.
Eric Olander
…the labour issue. This is a myth that just simply will not die and, despite the fact that researchers from SOAS, from Development Reimagined, from – I can give a – there’s reports that are coming out every year that have been scouring the continent looking at Chinese labour populations in Chinese SOEs, in Chinese construction sites, and what they consistently come up with is that 85 to 95% of the labour that exists in Chinese factories and Chinese companies is locally hired. The labour that is brought in from China today is generally, you know, specialised technical talent, for the most part.
It is simply too expensive now to bring a Chinese worker over to Africa. This is something that happened in the early 2000s, when it was cheaper, when China was still feeling its way, it didn’t know, but that has stuck in the imagination, and, just like the questioner said to – about it, always it comes down to, “I saw, I heard,” it’s always anecdotal. But the data simply isn’t there to back up the assertion that the Chinese bring massive amounts of labour.
What most people make a mistake is they hear that China’s a country of 1.3 billion people, so they think it’s overpopulated, and they need to export people out because it’s getting too crowded in China. The truth is, is that, just as Africa is facing demographic challenges because it is a growing population, China’s biggest challenge that it faces bar none is demographic as well, and that it’s a shrinking population. There are simply not enough young people in this country to support all of the older generation. So, labour costs are going up, which is why, in countries like where I am in Vietnam, the factories are coming here because the cost of labour’s going up.
So, very important that when the question of labour comes up, you always ask for data. Carlos Oya at the School of Oriental and African Studies, did an excellent survey on this in Angola, in Ethiopia, Development Reimagined, which is a Beijing-based consultancy run by Hannah Ryder. They did research on this. I can – go to my website, chinaafricaproject.com, we have all of the data out there. The evidence just isn’t there, this is more perception than reality.
Dr Alex Vines OBE
Thank you. Jacqueline, would you like to take a tilt at one of the other questions? Either source equality data or the one about where’s the best practice of Africans modelling and having agency over the relationship with China?
Jacqueline Musiitwa
Okay, I’ll go ahead and talk about the agency question.
Dr Alex Vines OBE
Yeah.
Jacqueline Musiitwa
And this is also based on my experience, rather than, kind of, what has been written in research. For many years, I was negotiating on behalf of African governments, so commercial agreements and the like, and my experience was that Rwanda was excellent in engaging not only China, but other foreign investors. The Government of Rwanda is very clear about what development objectives, what investment objectives, they were looking for, within what timeframe, and they were also not afraid to tell investors that were misbehaving that they were misbehaving and kicking them out.
I think the result of that is that Chinese investors that went in both public and private definitely abided by local laws, so whether it was mining manufacturing, you never really heard of any labour law infractions and the like. So, I think, because the message came from the top, that the Rwandan Government was going to have an equal level hand, as far as enforcing their laws. I didn’t really see a case of China really taking advantage of that, and I think Chi – if we look at it, China is like any other country, or like air. If there is space, you know, China will get into that space, and so I do think that the onus is on the respective African countries to enforce their laws, and if they don’t have the appropriate legal framework, as Rwanda realised in certain cases, they said, “Wait, we would like the investment, but we don’t have the necessary law, we will go ahead and enact that.”
I also think South Africa, which has a fairly advanced legal system, has done a better job than other African countries, as far as making sure that Chinese, both public and private, that are in the country, are abiding by local laws. But, at the end of the day, I do think that the power needs to come from the respective government to enforce their own laws, and whether it’s against the Chinese or against any other foreign investors in a country.
Dr Alex Vines OBE
Thank you very much, Jacqueline. Haifang, so the quality data, where do you get your best data in China from, in terms of debt and in terms of migration, too? So, where should we look?
Professor Haifang Liu
First, I want to say I’m not trained on the eCommerce, so I don’t…
Dr Alex Vines OBE
Yeah.
Professor Haifang Liu
…really, as a expert, as Eric has suggested, has shown, then lots of that issues already. I personally haven’t, and I wish I could have, but, generally, I want to say the similarly still, people still would to get this issues, this numbers, this data, from like Aid Action and like the John Hopkin, their publications, so on and so forth, for this – that issues. And I also feel very needed or the scholars need to go to dig the informations from both the Chinese Government, as well as the African individual countries, if you really wanted. So that’s my suggestion, so, like…
Dr Alex Vines OBE
Okay. Thank you, Haifang. I’m going to do one more round to try and get in before the clock defeats us, and so, the next question I’m going to take is one from Hishowa Tsutsumi, and his question is basically about “Where does China stand – now stand on its policy of non-interference? So, is China going to get more involved in African politics, as its strategic interests and engagements deepen?” So that’s one question.
A second one, which is also about politics, is by – is from John, excuse me pronouncing your surname Tomazwezki, and the question is, “Is it possible for the US and China to find a more balanced approach to co-existing peacefully and beneficially as partners to African states?” Obviously, that’s slightly, I think, tied to the results of the US elections. And then, the final question that I’ll take is from Jukka Pahta, which is, “Is there a mechanism for the African private sector to access Chinese technology directly, especially in the agro and food processing sectors?” So, those are three questions that have been asked, and we’ll, again, go to the panel for the final time. Please try and answer one of the questions at least, and if you have any final remarks. Eric, first to you.
Eric Olander
Wonderful. I’ll take the US question very quickly. I feel like I’m playing Jeopardy here. The – no, at this point, there is – it’s not going to be – there’s no visibility for the United States and China to work co-operatively in places like Africa or anywhere else. Even with the Biden Presidency, there is very little appetite in the United States to engage China in these matters. It’s – there’s just – we’re in a very – a period of contentious relationship, and there’s no constituency in the United States that is lobbying for a more constructive relationship right now. So, I wouldn’t expect that, and that’s as true on the left in the Democrats as it is on the right. It’s one of the only issues that unifies Americans today, is the distrust and the frustrations with China, so I wouldn’t expect that.
Very quickly, just before we go, I want to thank you for the opportunity to speak here today. I want to recommend that everybody go to China loan data, that is – chinaafricaloandata.org, that is – as Professor Liu mentioned, that is the China Africa Research Initiative’s interactive loan database. It is the best resource for Chinese loan data anywhere, so that’s chinaafricaloandata.org, and, of course, if you have any questions about China-Africa, come to my website, chinaafricaproject.com, I’d love to engage. We have a podcast, we have newsletters, we do everything in non-partisan, so I welcome everybody to reach out and say hello.
Dr Alex Vines OBE
Thank you very much, Eric. Jacqueline, have you got any thoughts about this idea of is there a mechanism for African private sector to access Chinese technology directly?
Jacqueline Musiitwa
Don’t, I’m just not sure, I don’t know that much about…
Dr Alex Vines OBE
Okay, fine.
Jacqueline Musiitwa
…Chinese technology, but I think what I will say, as far as solidifying power in Africa, I think, moving forward, a lot of African countries have found a lot more agency and really are negotiating on their own terms. I mentioned Rwanda, and I also think, following Kagame’s Chairmanship of the African Union, you’re starting to hear a lot more discourse of African solutions to African problems. So, I think, moving forward, as Africa – as China engages Africa, you will see more African leaders really spelling out what they need, and that could be as far as aid, it could be as far as trade. So, I think, moving forward, just I would say anticipate stronger African voices coming out to the rest of the world, as far as what they want and not really bowing down as much as they have in the past. Thank you for the opportunity to speak.
Dr Alex Vines OBE
Thank you, Jacqueline, and, finally, the last word to you, Haifang.
Professor Haifang Liu
Okay.
Dr Alex Vines OBE
And there is…
Professor Haifang Liu
Thank you.
Dr Alex Vines OBE
…the question also of…
Professor Haifang Liu
Finance…
Dr Alex Vines OBE
…the policy of…
Professor Haifang Liu
…and non-interference.
Dr Alex Vines OBE
…China’s non-interference.
Professor Haifang Liu
Yes.
Dr Alex Vines OBE
You know, does that continue…
Professor Haifang Liu
Yes.
Dr Alex Vines OBE
…or is that changing?
Professor Haifang Liu
I think it’s strongly continue, though there are lots more flexibility. So, like, one scholar raised the idea about creative involvement, that has been very much used as, kind of, a readjustment for how China need to really play more role, though you still play no interference. The Chinese Special Envoy has been as a mechanism since 19 – since 2006, that for issues. Now it has been really rather full-flighted. We have seen lots of issues that we have seen Chinese Special Envoy with a Judge and join the – like, the South Sudan issues lately, the IGAD, to increase China’s participations. But I just ask – discussed a lot with the Chinese Special En – the current lady, the Envoy, she – about this mechanism, what China specifically should play a role? She insist we only participate and increase the oppo – the possibilities about the African solutions. So, when our China participate for all this hard issues to China incre – emphasise that this is the Chinese standing point.
Dr Alex Vines OBE
Thank you very much, and, on that note, it is 14:00 GMT, so I want to thank everybody for having followed this, all 200 participants from around the world, from Africa, Asia, Europe, and North America, and particularly to our panellists. So, Eric Olander, Jacqueline Musiitwa, and Haifang Liu, thank you very much for spending this last hour with Chatham House to discuss the future China-Africa Relations – Short-term Gains and Long-term Goals? Thank you very much, and I hope everybody is safe and remains healthy, and I look forward to seeing you again very soon. Thank you very much. Goodbye to everybody.
