Turning the Coin in Africa – The Chinese Way

Africa ChinaTurning the Coin in Africa – Chinese way
A.K. Enamul Haque PhD.

with Philip Shaw M.Sc
The last time I wrote this column was in May, 2011.  After this, I was silent and I apologize to you for this failure.  Meantime, Phil and I had discussed this issue several times and decided to start writing again but this time without any podcast.  From now on, podcast will be optional because it has been dragging me most of the time.  This month I would like to talk about Kenya, a place that I visited last month in connection with my professional works at UNEP.
Kenya is an equatorial country located in the east coast of Africa, a member of East African Community. It is more known for its tourism and in particularly for its great tourist destinations like Masai Mara National Reserve, Nakuru National Park, etc.  Kenya gained independent from UK in 1963 and has become a Republic in 1964.  The country is divided into 8 administration regions with a total population of 41 million.
This was my second trip to Africa. Last time, I went to Senegal, which is on the west coast.   There is a huge difference between these two countries (of course, the time period is different too), as I see them.  They are also different in their history.  Senegal was under several colonial rules since 1000 AD.  Its national language is French and Arabic – Kenya’s is English and Swahili.
Kenya had a large community of Indians (mostly from Gujrat), who emigrated during the British rule to build the Railways.  These people are now quite powerful in terms of business and trade.  Because of these groups and also because of several different linguistic groups living inside Kenya, English is well spoken here.  This was a pleasant surprise for people like me.
Africa has been a supply source of resources to the world and unfortunately they never could fully take advantage of their vast natural resources.  It was always exploited by the powerful nations.  Colonial masters took it for granted and changed the rules of ownership (from communal / common property to private property) and it benefitted only those who understood the regime change in property rights.  Individuals and companies of the West or of the past colonial rules with knowledge advantages in extraction of mineral resources took control of these resources.  After independence, most of their colonial masters backed corrupt and undemocratic governments so that the flow of benefit continues. Moreover, bankers around the globe facilitated the corrupt officials of these governments (taking advantages of loose financial rules in these countries) to transfer billions of dollars out of Africa to Europe and America in their personal accounts.
These practices would have never changed but when China and India, specially China, started showing economic strengths inside Africa using their purchasing power in minerals resources, the Western world understood their faults.  Chinese involvement inside Africa has been a tricky one.  Instead of controlling the governments and officials, China decided to engage them in building infrastructure of these countries in close cooperation with government agencies (not private companies owned by rulers/officials).  As a result, money began to stay within the country (despite corruption) and also income of the governments started increasing.
Some might argue that this too will benefit China, as it would strengthen their resource trading ability with China.  However, new infrastructure (particularly transportation infrastructure) in the country literally unleashed economic activities within their economies.  One cannot imagine the highways being built by Chinese to link Mombasa to Lagos (of course, under a UN plan).  As I was talking to my taxi driver – he was saying – Chinese builds better roads. He was referring to the new highways built by Chinese and he was pretty happy with the quality.  Clearly, you can see the mindset of people.
Trends in Sino-African relationship are different than that of Afro-European or Afro-American relationships.  China (also India) sees Africa both as a supplier of resources and as a potential buyer of cheap Chinese products.  Europe and America never developed their relationship in this way.  So, their investment was mostly resource-centric while Chinese and Indian investment in Africa is market-centric.  Both China and India see a benefit with growth in Africa economies, which was not the case while Europe and America was building their relationships.
Finally, China and also India are less involved in the local political game plan of dividing nations, or creating new nations or changing governments.  They have built their relationship based on pure economic interest and who ever in power it should continue to grow.  I do hope the western world understands the tipping point clearly and change their rules of engagement with Africa and poorer countries in Asia. If you want to know why do I want this?  The answer is simple – values like democracy, human rights and liberalism are still cherished social targets of any nation, and in this the West has shown the path to the world.

Chretien, Africa and The Willing Partners

By Philip Shaw MSc.

Years ago (1987) I took Dr A.K. Enamul Haque to a lecture at Peter Clark Hall at the University of Guelph (Ontario).  The guest speaker was a Canadian private citizen by the name of Jean Chretien, a lawyer from Shawinigan, Quebec.  Dr. Haque of course is still a close friend today, but back in those days, he was green to Canadian life.  He was with me everywhere, trying out the nuances of our world.  He said you me, “Who is Jean Chretien?”  I told him quickly, he’s going to be the next Prime Minister of Canada!  He said what!  I told him, just come with me.
Long story short, I took Enamul to the lecture that night and a few short years later Jean Chretien became the Prime Minister of Canada, serving from 1993 to 2004.  He was a private citizen at that time and remarkably, Enamul and I got time to chat with him after his speech was over.

Fast-forward several years.  Jean Chretien was in Africa speeding down a dirt road with his delegation along with his Nigerian hosts.  The destination was a Nigerian village where Canada was providing funding to ensure clean water for some villagers.  He made a speech at the village where he talked about providing clean water for the area.  His thinking was 1st things 1st, and clean water goes a long way to curing a lot of problems.

We all know how water is important.  However it was the 2nd part of the speech that resonated with me.  Jean Chretien talked about if we raised Africa up that eventually they would turn around and buy the products that the Western world is producing. He wanted to turn around the chronic problems that Africans have and was throwing it back on the West by saying if we help them now they will help us later and in a very big way.  Is so true.  I’ve never forgotten that statement.

You might say that Jean Chretien took a page from the market centric approach that China and India are taking with Africa.  It is true; we are a long way away from Africa being a world superpower buying goods from the West.  However, it is entirely reasonable to look at the Chinese and Indian investment as a very good thing for Africa and something that may pay dividends down the road.  Jean Chretien was talking about the same types of things, but in a different way.  Canada continues to invest in Africa but with very paltry aid budgets.

It is not only China and India, which are investing in Africa.  As part of the Pro-Savana deal signed last year, Brazilian farmers are headed to Mozambique to help that country increase its agricultural production.  News of that kind jilted me, as I’ve always known about African agricultural production potential but this venture seem to add up.  The Brazilians and the Mozambicans have a shared colonial and common language as well as climate and terrain.  For instance, northern Mozambique and Brazil’s vast central savanna, the Cerrado, are very similar.  The Brazilian Cerrado, once a pioneer region has been transformed into an agricultural powerhouse over the last 30 years.

The Pro-Savana deal signed by the Brazilian and Mozambican agricultural research institutes will cede 6 Million hectares of land in the northern regions of Mozambique to Brazilian farmers for $13 per hectare. There will also be some assistance from a Japanese international cooperation agency.  The bottom line for the Mozambicans is to boost agricultural production in a very big way, Brazil style.

Does that mean someday southern Africa may be just like Brazil agriculturally?  I know.  That’s a stretch, but years ago I was standing on the other side of the world in an Australian soybean field, asking the same things about Brazil.

It’s interesting when Dr Haque says, “I do hope the western world understands the tipping point clearly and change their rules of engagement with Africa and poorer countries in Asia.  It’s a great theory, but with the West’s current economic problems, will it happen?  Or will countries like Brazil, Argentina, Russia, India and China fill the void?  From Africa’s perspective, would it make a difference?
That’s where democracy, human rights and liberalism come in.  It probably does make a difference, but when you have so far to go, like Africa does, you’ll take the willing partner, wherever that may be.