China’s burgeoning relationship with Africa is being decried in some quarters, including western observers – and some Africans, too – as a new form of colonialism. Such criticism is largely misplaced. First, after having preached the globalisation tenet of economic liberalisation and free competition, the West cannot really grumble about being outbid by China in the race for natural resources in Africa. Second, even though all is far from being rosy in China-Africa cooperation, Chinese increasing engagement in the region presents real and significant opportunities for the development of African countries.

Interview by Mahmoud Hassan Laota
With the daily business newspaper : Al- EQTISADIAH – Riyadh Saudi Arabia.

The dialogue :

Q1 : In your article “China and the African Front”, do you believe that cheating and fraud were the basic reasons that allowed the Chinese Communist Party to stay in power for so long ? What do you mean exactly

No, I do not believe that it was through cheating and fraud that the Chinese Communist Party stays in power. It did so in conducting a successful communist revolution, in liberating China, and keeping the mainland united with the exception of Hong Kong, now recuperated from the British, and Taiwan   that China vows to recover. If China used cunning and deception in order to retain power, it was to defeat the colonial powers and all its subsequent enemies.

Q2 : How do the African states see China after it became a superpower and went beyond the age of the movement of non-alignment countries ?

China’s activities in Africa have given African countries option to break free from the hold of the former European colonial powers, the western countries and the roller coaster of institutions such as the IMF, the World Bank, and the WTO. We ought to remember that after their independence, African countries were labeled insolvable by the western rating agencies and barred from borrowing in the international capital markets. To raise capital in order to finance their development, they were limited to official development aid (ODA) assorted with conditionality which tied them to a system which, instead of promoting their development, maintained them rather in a web of exploitation and a circle of appalling poverty.

However, the rules governing China’s strategy in dealing with African countries has nothing to do with the politics of non-alignment. Since the “reform and opening up” began, under Deng Xiaoping, in 1978, China’s politics may be socialist within its boundaries, but its economy is hard-nosed and capitalist-driven. It is through its multinationals that China strikes deals all over the world, including Africa. The rule is to make profits and exert world domination. The Bandung spirit is over.

Q3 : Has China actually succeeded in increasing its influence on the Africans to stand to the West as a result of the remnants of old colonial feelings ?

China’s dealing with Africa is based on an integrated package of AID/TRADE/INVESTMENT in opposition to the west, whereby the core of their development policy was articulated around the aid distilled by the Bretton Woods institutions (IMF & World Bank) which imposed on the Africans the infamous and devastating structural adjustment programs which consisted on financial deregulation, economic liberalization, and privatization of public assets (currency devaluation prior to privatization meant that it was proper to speak of liquidation rather than privatization, stricto sensu).  These policies brought about mayhem to the African countries while enriching the west and its institutions. The entry of the fast growing economies into Africa, especially China, gave to African countries development strategy alternatives that could, ultimately, free them from western domination.

Q4 : How do you see the prospects of Chinese investments in Africa in view of the political instability of some countries, like the Sudan for example ?

China’s credo of “non-interference in domestic affairs” and “separation of business and politics” is, not surprisingly, music to the ears of African leaders, who fall over each other to sing the praises of Chinese cooperation with their countries.

Most of these leaders are corrupt, incompetent and undemocratic. They spend their time plundering the resources of their countries. To quote just an example, let’s take Gabon which earns thirteen billion dollars of annual oil revenues, not to mention timber and other export revenues with a population of 1.2 million inhabitants. The Gabonese still live mired in abject poverty. And when the Gabonese president, the late Omar Bongo died, France which is the main beneficiary of Gabon’s riches helped his son, Ali Bongo, to succeed him. So, to be fair to the Chinese, it is not their business to interfere in African politics as former colonial powers do. If there is the correct leadership, China activities will help boost progress and promote stability. China can provide options to the Africans, but it is up to the Africans to exercise good leadership to conduct the right policy that would lift their people out of poverty and put their country on the path of economic development and social justice.

Q5 : Do you think that the narrow economic view and the colonial background influence the various relations with African countries ?

The former colonial powers are fighting hard to maintain their privileges. It is up to the Africans to deny them and take the opportunity of the entry of fast growing economies in Africa in search for resources and markets to reverse western influence for the better.

Q6 : Do you expect that China in the future will control Africa on the economic front and displace the western influence ?

I hope that the Africans have bigger ambition that being controlled by whichever it is.

Q7 : It is known that Africa suffers from economic backwardness, and the infrastructure sees obvious damage. As an ex member of the African Development Bank, how do you see this? And what is the best solution to these problems ?

For the first time in many years Africans have the choice to invest in education, health, infrastructure, to build viable institutions, to abide by the rule of law, to tame corruption, to integrate their economies, etc. This is the recipe for lasting progress and it depends on competent leaders whose agenda is to develop the countries that they govern, and not to enrich themselves.

Q8 : Do you see the Chinese economy as cooperating with some Asian countries that need economic support like the African countries ?

China overtook Japan in 2010 to become the second largest world economy behind the USA. China will most likely supersede the USA by 2025 to become the first economy in the world. China is a great power and as such, has to reach out to countries the world over.

Q9 : Can you give us your take on the Sino American relations and the currency war between the two countries ?

The so-called currency war stemmed from the strategy developed by the USA, euro members of the European Union and Britain to print billions of dollars of money to keep their interest rates close to zero. The US central bank (FED), the European Central Bank (ECB) and the Bank of England resorted to quantitative easing (QE) to record artificial productivity gains by engineering low interest and exchange rates at home, while causing interest and exchange rates to rise in fast growing economies As a result, all the billions of dollars released in the world economy found their way in emerging markets such as Brazil, India, South Africa, the Philippines, South Korea, etc. These inflows contribute to increase the interest rates and the exchange rates of these countries, eroding their productivity and competitiveness. China, which has put in place capital controls, is immune from the contagion.

Furthermore, in flooding the world with printed money, the proponents of QE are awakening high inflation everywhere. Increase in food prices is lengthening the list of people falling into poverty, and is destabilizing the world.

Q10 : Do you think that the African countries are still under economic and political oppression ? When will Africa free itself from this control ?

Yes, Africa is still very much under political and economic subjection. However, if African countries spoke with one voice, traded more among each other, and strengthened regional co-operation (which includes keeping the peace), they would go a long way towards overcoming the political frailties and economic fragmentation associated with the borders inherited from colonialism. It is therefore of paramount importance that the African put the building of a pan-African identity and their unity at the top of their agenda for progress. Whatever important the amount of trade is with China, its remains that the bedrock of lasting peace and prosperity in Africa remains in a steady increase in intra-trade among the countries of the region, the respect of human rights and the instauration of democratic rules

Q11 : What is the purpose of the Chinese investments in Africa ? Is it to develop the continent? Or are there other agendas ?

Four objectives underline China’s comprehensive and coordinated engagement strategy in the region: consolidating security of energy and mineral supplies, using African countries as bases to produce and export to the United States under the African Growth Opportunity Act (AGOA)  preferential treatment, curtailing Taiwan’s diplomatic ties in the region, and increasing China’s burgeoning influence around the globe.

This poses a new and substantive challenge to Africa — how can African economies make the most of the opportunities offered by China while minimizing the potentially negative impacts posed by China’s growing presence ?

African countries can respond to this challenge in articulating an African strategy in dealing with China. For the time being, such a strategy is nowhere to be seen.

Q12 : Do you expect an eclipse of the European influence (economic and political) over Africa, even though it was Europe that colonized most of Africa ?

Throughout the 18th, 19th and most of the 20th centuries, European colonizers used Africa as their backyards for their supplies of oil, raw materials and other minerals, and as a market to sell their products. Since the fall of the Berlin wall in 1989, the world economy has been globalized. Africa is in the process of becoming a huge market of over 1 billion people. Besides, Africa is home to 10 per cent of global oil reserves, 40 per cent of the world’s gold, a third of world reserves of cobalt and base metals, and 60 per cent of the world’s total amount of uncultivated arable land. The long-term global demand of these resources is unlikely to diminish. European political and economic influence is still very much alive, particularly in the former French colonies. However, new countries with economic clout in the world such as Brazil, Russia, India, Malaysia, Turkey, South Korea, Iran, Venezuela, and especially China are vying to have a foothold in the continent and will more and more alter the old balance of power in the world and in Africa as well.

Q13 : Do you expect that China and the US will arrive at an understanding over their conflict on Africa ?

China has a long term view of its development. It sees the positive aspect of collaboration between all the major trading and investment actors in Africa and is working hard to establish working partnership between them.

Q14 : Do you think that the Chinese economic intervention in some countries would cause political problems to some regimes ?

No, I can’t visualize such a scenario happening. China is extremely keen to listening to critics of its policies in Africa and prompt on acting to alleviate these critics.

Q15 : Do you think that China will play the same role played earlier by European colonialism during the colonial period, I mean exploiting the resources of Africa, albeit in a different manner ?

No, China, and indeed all the emerging markets entering into Africa have developed a cooperation model based on aid, trade and investment in a variety of sectors whereby the western powers were satisfied exploiting Africa’s resources and investing only on extractive industries.

Q16 : As someone who works in the investment of banks, do you think that the African banks have a role to play in the economic development of their countries ?

Western investment banks were notoriously absent in Africa. This absence is now being corrected by the banking networks of Morocco Tunisia, Nigeria and South Africa which are making headways in the region, challenging the old banking order dominated by western commercial banks.

published in :  http://www.aleqt.com/2011/03/20/article_516774.html

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