Staying on the Sidelines: China’s Limited Role

Both allies and opponents of China’s presence tend to assume that it has an important political impact.

Claude Kabemba's picture

Director of the Southern Africa Resource Watch (SARW)

October 5th, 2012

Both allies and opponents of China’s presence tend to assume that it has an important political impact.

For friends, it provides a welcome source of support in contrast to the perceived disdain of the West, with its constant demands that Africans conform to its values – we noted earlier, for example, how China’s willingness to invest in the DRC was seen as a confidence booster in contrast to the denigrating attitudes in the West. China, it is argued, has prioritised Africa as a strategic partner at both the political and economic levels, while seeking to link African commodity and consumer markets to China’s growing economy. Its development assistance is said to be expanding as its investment footprint increasingly covers key economic sectors. Those who take this view argue that China's push into Africa provides several of the continent's states with a new and hugely influential trading partner to drive up prices and increase the bargaining and leveraging power of African governments when courting foreign investment. Another major advantage of China as a development partner in Africa is the speed with which Beijing is able to make and implement decisions. Africa-China relations are said to have increased Africa’s strategic importance, and therefore its ‘power influence index’ value in the global context.

For critics, its immediate impact is to provide protection for dictators. Thus China’s non-interference policy has been criticised as support for undemocratic rule and corruption – in, for example, Sudan and Zimbabwe. In the case of the DRC, concerns are that China’s presence with big cheques will render President Joseph Kabila’s government arrogant, and start to reverse the democratic gains brought about by western encouragement. (Its supporters reply that the West has also turned a blind eye to undemocratic regimes – in, for example, Angola, Congo-Brazzaville and Gabon – when its interests were at stake). Critics also suggest that China is developing a sphere of influence in Africa, just as colonial powers once did. Our Zimbabwe study notes the view that China’s new engagement in Africa is part of a long-term strategy, aimed at displacing the traditional western orientation of the continent by forging partnerships with African elites under the rubric of south-south solidarity. From this perspective, this is a process that will ultimately result in some form of political control over African territories.

Both supporters and critics see China’s role as a symptom of a wider geo-political shift. Thus one of our research studies notes that consensus abounds that the world balance of power is changing at both the political and economic levels, especially the latter. The ascendance of China to the number two slot in the world economy as measured by gross domestic product (GDP) leaves little doubt that the world economy is being redefined. This vindicates predictions by The Economist in October 1994 that the biggest shift in economic strength for more than a century would occur in 2020. Using the data provided in this issue of The Economist, and using the GDP at purchasing power parity (PPP) as measure, five current developing countries will be part of the G8 (with China leading the group) in 2020. It was further foreseen in this Economist issue that China will surpass the US to become the world’s largest economy in 2025.

This is seen as part of a wider shift in power towards emerging markets. It is noted, for example, that the number of trans-national companies from developing countries (such as Brazil, China, Hong Kong, India, Russia, Singapore, South Africa, and Taiwan) that are generating outflows of foreign direct investment (FDI), mostly into other developing countries, has increased remarkably. While only 19 such companies featured among Fortune 500 in 1990, 47 did in 2005. These companies generated FDI outflows of US$120 billion in 2005, the highest level ever recorded. In similar vein, our Democratic Republic of Congo study argues that the rise of China and the decline of the USA will be accompanied by tension, distrust, and conflict. In Africa, this conflict might well be fought in the DRC, which became a battlefield during the Cold War because of the need to control mineral resources, and because of geographic positioning. The coming battle between China and the west will be fought in the DRC for the same reasons, it argues. It does not predict an armed conflict – it believes that this time economic preoccupations will take pre-eminence over political considerations – but it does suggest that Africa is becoming the scene of a struggle for control.

This impression of a global conflict is heightened by obvious Western antipathy to China’s role which has at least once become an overt attempt to curb it. Thus China’s US$9 billion concessional loan to DRC, the biggest financial agreement ever signed by China in Africa, was reduced following International Monetary Fund intervention. The IMF threatened to disqualify the DRC from debt cancellation if the deal was allowed to proceed without adjustment. In the initial phase of the agreement, before the IMF and World Bank intervened to try to stop it, the two Bretton Woods institutions argued that the DRC could end up increasing its debt. Criticising the Angolan model, World Bank head Paul Wolfowitz, the UK government and the IMF argued that Chinese activities would plunge Africa into deep debt, and the US Treasury termed China a ‘rogue creditor.’ For the west, the China-DRC deal was not acceptable. If the DRC was to benefit from the Poverty Reduction and Growth Facility (PRGF) programme, the deal needed to be reviewed. Critics of the West argued that, although this criticism saved the DRC from what could have been a problematic deal, it exposes the hypocrisy of the West in its relations with Africa; Africa remains trapped in debt not because of China but because of past dealings with the West, and the recent cancellation by the West of debts for certain African countries has come when the countries concerned have already undermined their development due to a decade of debt repayments.

The IMF and the World Bank delayed the implementation of the project, requesting that the amount be reduced, and that the agreement be presented as a commercial contract where the DRC government is not a guarantor to repay the debt in case the profit from minerals cannot repay China’s investment. The IMF argued that in order for the IMF and the World Bank to be able to go ahead with a new three-year Poverty Reduction and Growth Facility (PRGF) programme (which would eventually make way for substantial debt relief for the debt-laden DRC), the Sicomines contract (Sicomines is a joint venture company owned by Gecamines and a Chinese consortium) had to be re-negotiated so that it was not structured as government debt. The IMF would not proceed with a multi-billion debt relief programme only to see the DRC contract new debt with China. The Chinese and Congolese stakeholders argued that the financing provided by China EXIM Bank for the Sicomines joint venture was not to be seen as government debt since it is mineral-backed and taken on by a joint venture, even though there were certain clauses in the contract (articles 10.3, 13.2 and 13.3.3) which stated that the Congolese state guaranteed the repayment of the loan. China, in an effort not to delay the implementation further, agreed to the IMF and WB requests. The amount was reduced from US$9 billion to US$6 billion, and the contract was restructured to read as a commercial one. In 2010, the DRC benefited from the PRGF despite Canada lobbying against it (due to the Congolese government decision to cancel the mining rights of a Canadian company, First Quantum).

The evidence, however, suggests that judgments which read important political intent into China’s presence are premature. In reality, China’s promises of non-interference have been kept. There clearly are issues to which it is extremely sensitive. Recognition of Taiwan is an obvious one. South Africa’s decision in 2011 not to grant a visa to the Dalai Lama to allow him to attend Archbishop Desmond Tutu’s birthday celebrations was also seen as a concession to China. But beyond this there has been little evidence that China wishes to secure political conformity from its African partners. Our studies, even where they were very critical of China’s role, reported no evidence of attempts to secure African support for its international positions – it is not even clear whether China asked South African to bar the Dalai Lama or whether the South African authorities simply decided that this is what China would want. Some analyses linked the South African attitude to the SA Communist Party’s relationship with the CCP, which is unique in our case studies. China has not yet tried to play a similar role to that which India once sought through the non-aligned movement – to gain influence by becoming a champion of the interests of the global South. Its interventions have been rare and have been limited to making it clear that it does not want its economic partners making common cause with those it believes pose an immediate threat to it at home. Our DRC study thus notes that President Joseph Kabila’s regime has been able to see China as an economic but not as a political partner – the USA remains the guarantor of regime stability (as long as the US has not asked for regime change, Kabila’s rule is protected), and China has become the hope for the DRC’s economic development.

It remains possible, of course, that China will become more politically assertive in the future, and that it may feel that its economic relations with Africa entitle it to demand political loyalty. But that has not yet happened. For now, China’s political ambitions seem extremely limited – it is yet to emerge as either a new colonial master or as a powerful friend of African interests. Its chief political role now is to provide African governments with an alternative to the West which is available without surrendering sovereignty (which often seemed under threat by the Soviet Union as well as the US in the Cold War). Where African governments are not democratic, this can undermine efforts by citizens to win democracy. But it also, of course, leaves the fates of countries in the hands of domestic politics, in contrast to relations with the West.

But, if China is no new hegemon, it is no partner in solidarity either. The rhetoric of co-operation agreements notwithstanding, its current role in Africa is best summed up by the observation of our Zambia country study that China does not have a political agenda save for that which will ensure that its economic gains are not jeopardised – it finds that the current arrangement between China and Zambia is more of a capitalist co-operation, based on the profit motive. The same observation can be made of the other arrangements – the evidence shows that China’s interest in Southern African is maximising economic advantage. As other chapters also point out, the difference between China and other investors is often an illusion. The following section will provide evidence from our country studies to support our contention that the relationship between Southern Africa and China should be seen as an economic one, not as an exercise in South-South solidarity or as a new form of colonial control.

About the author(s)

Claude Kabemba is the Director of the Southern Africa Resource Watch (SARW). In 2006, the Open Society Initiative for Southern Africa (OSISA) asked him to spearhead the formation of SARW. He holds a PhD in International Relations (Political economy) at the University of the Witwatersrand (Thesis: Democratisation and the Political Economy of a Dysfunctional State: The Case of the Democratic Republic of Congo). Before joining SARW, he worked at the Human Sciences Research Council and the Electoral institute of Southern Africa as a Chief Research Manager and Research Manager respectively. He has also worked at the Development Bank of Southern Africa and the Centre for Policy Studies as Policy Analyst. Dr. Kabemba’s main areas of research interest include: Political economy of Sub Saharan Africa with focus on Southern and Central Africa looking specifically on issues of democratization and governance, natural resources governance, election politics, citizen participation, conflicts, media, political parties, civil society and social policies. He has consulted for international organizations such Oxfam, UNHCR, The Norwegian People’s Aid, Electoral Commissions and the African Union. He has undertaken various evaluations related to the work of Electoral Commissions and civil society groups interventions in the electoral process in many African countries. He is regularly approached by both local and international media for comments on political and social issues on the continent. His publication record spans from books (as editor), book chapters, journal articles, monographs, research reports, and newspaper articles.

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