Feature

When China Met Africa

It seemed a perfect match: A growing country looking for markets and influence meets a continent with plenty of resources but few investors. Now that China has moved in, though, its African partners are beginning to resent their aggressive new patron. What happens when the world's most ambitious developing power meets the poverty, corruption, and fragility of Africa? China is just beginning to find out.

"Ni hao, ni hao." I had been walking along a street in Brazzaville only 10 minutes when a merry band of Congolese kids interrupted their ballplaying to greet me. In Africa, white visitors usually hear greetings like "hello, mista" or "hey, whitey," but these smiling kids lined along the street have expanded their repertoire. They yell "hello" in Chinese, and then they start up their game again. To them, all foreigners are Chinese. And there's good reason for that.

In Brazzaville, everything new appears to have come from China: the stadium, the airport, the televisions, the roads, the apartment buildings, the fake Nikes, the telephones, even the aphrodisiacs. Walking through this poor capital city in West Africa, a visitor could be forgiven for assuming he was in some colonial Chinese outpost.

No one knows more about China's reach in Congo than Claude Alphonse N'Silou, the Congolese minister for construction and housing. In fact, in Brazzaville, the Chinese are building more than a thousand units of housing designed by N'Silou, who is also an architect. They are also building the minister's house, a Greco-Roman palace that makes the U.S. Embassy next door look like a small bunker. I meet the minister at nightfall in the habitable part of his construction site, while, outside, Chinese workers from the international construction company WIETC have turned on spotlights so they can keep making concrete and hammering in scaffolding.

"Have you seen how they work?" N'Silou says jovially, gripping the arms of his leather chair while a servant serving French sparkling water glides along the marble floor in slippers.

"They built the Alphonse Massamba Stadium for us, the foreign ministry, the television company's headquarters. Now they are building a dam in Imboulou. They have redone the entire water system of Brazzaville. They built us an airport. They are going to build the Pointe-Noire to Brazzaville highway. They are constructing apartment buildings for us. They are going to build an amusement park on the river. All of it has been decided. Settled! It's win-win! Too bad for you, in the West, but the Chinese are fantastic."

The story of China's quick and spectacular conquest of Africa has captured the imagination of Europeans and Americans who long ago considered the continent more charity case than investment opportunity. From 2000 to 2007, trade between China and Africa jumped from $10 billion to $70 billion, and China has now surpassed Britain and France to become Africa's second-largest trading partner after the United States. By 2010, it will likely overtake the United States as well. The Export-Import Bank of China, the Chinese government's main source of foreign-investment funds, is planning to spend $20 billion in Africa in the next three years -- roughly equal to the amount the entire World Bank expects to spend there in the same period. For the Chinese and the Africans, the partnership does seem to be "win-win": China gains access to the oil, copper, uranium, cobalt, and wood that will fuel its booming industrial revolution at home, and Africa finally sees the completion of the roads, schools, and other keys to development it desperately needs. Most analysts think it is only the beginning. With its basic but reliable technology, its ability to mobilize thousands of workers to building sites anywhere, and its phenomenally large foreign-cash reserves, China has the opportunity to assume a leadership position in Africa and to transform the continent profoundly. And why not? The Chinese have created a true economic miracle at home, so they more than anyone should be able to pull off the same magic in a place where the rest of the world has failed.

And yet, there are cracks in the facade. China's profits and influence may be on the upswing in Africa, but China is beginning to run into the same obstacles the West has faced for years: financial and political corruption, political instability, lack of interest -- even resistance -- from the local population, and sometimes a simply miserable climate. Several of the head-spinning contracts the Chinese signed throughout the continent have been canceled. Those cheap sneakers the Chinese are sending in by the shipload are infuriating the local manufacturers and storeowners they undercut. And the Chinese, with their laissez-faire attitude toward workers' rights, may be earning themselves more enemies than they realize. What's more, China, unlike its Western counterparts, is attempting to operate in a region that is, by and large, more democratic than it is. What happens when the world's most enterprising business people run up against the hard truths of a continent that has known more poverty than profits? Might China be just another mortal investor, subject to the same problems, inefficiencies, and frustrations every other global power has faced in Africa? If so, it may mean that, for Africa, the Chinese "miracle" is nothing more than another lost opportunity.

HOLLOW VICTORIES

It isn't hard to see why Chinese immigrants would be attracted to Africa. With wages rarely exceeding $150 a month on the farms and in the factories of China's remote provinces -- and with the eastern cities becoming overrun with migrant labor -- Africa looks like a promised land. According to Huang Zequan, vice chairman of the Chinese-African People's Friendship Association, there are now 550,000 Chinese nationals in Africa, compared with 100,000 French citizens, and 70,000 Americans. Beijing sent some of them to build dams, roads, and railroads. Other Chinese simply hope to get rich in some of the poorest countries on the planet.

For many African governments, China's interest in the continent is most welcome. African leaders have not hesitated to hand over the responsibilities of public office to China. It's China that these leaders turn to when they want schools, housing, or hospitals -- often just before elections in order to gain as much profit as possible from these projects. They rely on the efficiency and ambition of the Chinese in hopes of having their own shortcomings forgotten.

"The Chinese are incredible," says Omar Oukil, an advisor to the Algerian Ministry of Public Works. "They work round the clock, seven days a week. It would be good for us if a little bit of their rigorous work culture rubbed off on us." I was politely shown the door when his workday came to a close at 4 p.m. The hallways of the ministry were empty when I left. At the same time, on the Mitija plain in southern Algeria, Chinese workers from the Chinese construction firms CITIC and CRCC were putting night crews in place. They would have a little more than 3 years to build a large portion of a 750-mile highway full of tunnels and viaducts. To do so, they had to bring 12,878 workers from China to Algeria.

But these immense projects also highlight the competing interests of Chinese-African cooperation. Take, for example, the dam being built at Imboulou in Congo. Officially, it's a huge success: It's expected to help double national electricity production by 2009. Ten years ago, the World Bank had deemed the country too indebted to warrant financing of the project. China, however, dedicated $280 million to it in 2002. Congo plans to pay that sum back in oil.

"The Chinese drive me crazy," says an engineer from Fichtner, the German company that oversees the work. They are building the dam at a discount, and he worries it might not hold up very long. He claims that the quality of the cement being used is sub-standard, that the Congolese workers are so poorly paid that none of them stays longer than a few months, and, above all, that the drilling has been so poorly done that half of the dam sits on a huge pocket of water that continually floods the site and could cause it to collapse one day.

It's difficult for Wang Wei, the Chinese engineer in charge, to respond to these accusations, and not only because he's been knocked out by a bout of malaria. "It is my first trip to Africa," he says, his eyes shimmering with fever. It is also the first time that his company, CMEC, has built a dam. Its previous business had only involved importing and exporting construction vehicles. Wang blames the company's problems on the sub-Saharan climate. "The rainy season is too long here," he says. "We have gotten a little behind, but we will emerge victorious from our battle with nature." The Chinese boss is particularly angry with the workers he pays three to four dollars a day. "They treat the site like a school. They have hardly learned something before they go somewhere else to use it." He would like to ask the Congolese government to make some prisoners available to him so he could be sure his workers wouldn't flee.

Angola, long held up as China's most spectacular success in Africa, is also beginning to question China's commitment to the country. In 2002, after 27 years of civil war that brought the country to its knees, Western countries refused to organize a conference of donors, citing a lack of transparency and the disappearance of billions of dollars in oil revenues. The government turned to China, which offered between $8 billion and $12 billion of credit to rebuild the country (and to make Angola its main supplier of oil, ahead of Saudi Arabia and Iran). At least, that was the plan. But you have to expect some surprises when you attempt to rebuild a railway connecting the coastal city of Lobito with the inland border of the country formerly known as Zaire. This vital artery of colonial Angola was entirely destroyed during the war. The Chinese promised to rebuild it by September 2007. By November, however, they had abruptly dismantled their base camps along the line.

"The Chinese spent months getting their camp together and bringing in brand-new bulldozers," says a security guard at Alto Catumbela, an old industrial center in the Angolan plateau that was devastated by the war. "Then, instead of beginning to repair the line, they dismantled it all, ate their dogs, and left." You can still see the spot in the middle of the big field where the sheds used to be. The vegetable plots where the Chinese cooks grew cabbage and other vegetables are still visible. But, except for a few antimalarial tablets on the ground, everything has vanished.

In Lobito, the assistant director of the Benguela Railway Company confirms that 16 Chinese camps were dismantled and reveals that the $2 billion contract has been canceled. "I don’t know anything else about it; the negotiations are taking place at a very high level," he says.

This very high level, on the Chinese side, is a mysterious holding company in Hong Kong called the China International Fund (CIF). Its job is to coordinate funds and projects in Angola, as well as deal with reimbursements in oil. Its Internet site boasts about 30 gigantic projects, none of which appears to have broken ground. On the Angolan side, the very high level is the National Reconstruction Office, headed by Gen. Manuel Helder Vieira Dias. He is considered a possible successor to the president. Neither side agreed to respond to questions, but there are numerous signs of a major crisis brewing between the two countries: A $3 billion contract for an oil refinery in Lobito was canceled by the Angolans, and $2 billion allegedly disappeared into Chinese accounts.

It all brings a smile to the faces of the 20 or so Western diplomats in Luanda who send cryptic messages to their capitals detailing the Chinese-Angolan dispute, even as they try to make up ground in a country thought to have been lost to China.

"The Chinese promised an awful lot, [and] the Angolans demanded an awful lot," says a Western diplomat. They were both "out of kilter with reality." Says another: "The Chinese do not have enough experience in Africa. They did not realize that the kickbacks in Angola would be so high." A European diplomat sticks the knife in deeper: "We say to our Angolan friends, 'It's great that you're taking a little walk with the Chinese. Enjoy yourself. But when you're ready to play in the big leagues, pay your debts and come and see us.'"

THE BACKLASH BEGINS

Despite the arrogance and condescension in such words, they do reflect some hard truths. China may be a willing partner to many of the regimes and countries the rest of the world won't touch, but that hardly means Africans are always satisfied with their arrangements. In a country like Angola, which has raked in $100 billion in five years and has posted one of the highest growth rates in the world since 2002, newfound economic success often means they can begin to dictate the terms of their own deals. And often, those new deals don't include the Chinese. Ironically, because of early help from the Chinese, Luanda may now have the means to avoid getting trapped in a relationship with a partner as voracious and demanding as China. The oil refinery in Lobito is expected to be awarded to the American firm KBR, and the regime of José Eduardo dos Santos has just reconciled with France after an eight-year tiff.

And Angola isn't the only country beginning to feel comfortable saying no to China. In Nigeria, an April 2006 agreement in which China would have paid $2 billion for first access to four oil blocks was canceled. A similar agreement that involved CNOOC, the state-owned Chinese oil company, fizzled out. In Guinea, a billion-dollar financial package involving a bauxite mine, an aluminum refinery, and a hydroelectric dam was called off.

In some cases, such contracts have been canceled or failed to materialize as a result of a deliberate strategy on the part of African rulers. Spectacular announcements of Chinese contracts have been made with the intention of frightening Western partners into offering better terms. In meeting after meeting with African officials, I heard the following plea: "Write in your magazine that the Chinese do not have a monopoly here, and we would love to have the French or anybody else doing work here, if they make a competitive offer." Niger, for instance, dangled uranium rights in front of Chinese companies and even went so far as to expel an official from the French nuclear concern Areva in an apparent effort to persuade it to increase its bid for a mine in Imouraren, which has one of the world's largest untapped deposits of uranium in the world. Areva signed the contract in January 2008, and it was considered a triumph for the regime of President Mamadou Tandja.

When China feels betrayed by African governments, it can't easily fall back on public opinion. Despite all its talk of brotherhood and lack of a colonial past, China remains unpopular. From Congo to Angola, taxi drivers, street sellers, even locals working on Chinese construction sites complain about the influx of Chinese. "They are like the devil," "They do not respect us," "They are here to take everything from us" are the common refrains. Perhaps the relationship is too recent -- and one that really only exists between officials -- to have given personal ties the chance to form. It's rare to see Chinese and African workers at the same construction site go and drink a beer together at the end of the day.

Grass-roots resistance to the Chinese has sprung up. In 2004, in Dakar, Senegal, the powerful lobby of Senegalese and Lebanese shopkeepersorganized several protests against the Chinese boutiques, whose prices they said were undercutting them. Shops were set on fire. President Abdoulaye Wade was given an ultimatum by the shopkeepers' union to kick all Chinese nationals out of the country. Although he didn't go that far, he forced through a near total moratorium on visas issued to Chinese citizens from his country's embassy in Beijing. He then finagled a more open policy toward visas from the Chinese Embassy in Dakar. This enabled Senegalese storeowners to establish connections in China and maximize their profit margin on Chinese imports to Senegal. In October 2007, China's state-owned news agency had to admit that "the Senegalese doing business in China far exceeds the number of Chinese doing business in Senegal."

Undoubtedly, though, the country with the most intense anti-Chinese sentiment is Zambia. When an April 2005 explosion in a Chambishi copper mine killed at least 50 people, the Chinese owners were accused of ignoring basic safety regulations. The miners demonstrated against their employer, and their protests struck a chord in the capital, Lusaka. Opposition leader Michael Sata made the Chinese the focal point of his presidential campaign in September 2006 by accusing them of destroying the country. He even charged the Chinese Embassy with supporting his opponent, incumbent President Levy Mwanawasa. Although he briefly led in the polls, his bid was unsuccessful (and likely the result of voter fraud). Five months later, while touring the continent, Chinese President Hu Jintao was forced to abandon plans to visit the "Copper Belt" due to fears that the workers would revolt again. Never before had a Chinese leader experienced such an affront in Africa.

Generally, China seems to have difficulty maneuvering in countries more democratic than itself. Zambia is not a perfect democracy, but, unlike in China, its press is relatively free, unions exist, and public opinion matters. During a major China-Africa summit in Beijing in November 2006, organizers at the Chinese press center distributed the short book, China and Africa 1956-2006, by historian Yuan Wu. It presents democracy as a scourge because it "exacerbates" tensions inside African countries. "Fortunately," the author concludes, "the wave of democratization has started weakening."

OUT OF AFRICA?

For all the tensions between Africa's need for development and democracy and China's need for resources and riches, however, there is one sector where the interests of both Africa and China seem to be in sync: oil. It's the most important commodity that China wants from Africa, and the oil-producing countries in Africa also happen to be the ones that receive the most Chinese investment. So, many experts consider oil to be the principal indicator of whether China will have succeeded or failed on the continent. And it's not the African oil that China buys at market price, which makes up around 20 percent of its imports, that's so important, but the oil that it manages to produce there. Oil-producing African countries have lured most of the Chinese investment, which was supposed to create "goodwill." So far, the harvest has been thin.

It has been a major handicap for Chinese companies that they lack almost any expertise in deep offshore oil production. It has prevented them from participating in bidding on the most attractive fields in the Gulf of Guinea. These companies have used Africa’s east coast as a fallback location, though deposits there have turned out to be much less abundant than those in the west. Because four of CNOOC's six oil blocks proved too difficult to explore, the company returned them to the Kenyan government, which graciously took them back last July.

As a result, the only real success that the Chinese have had with oil in Africa has come in Sudan. International companies had to leave Sudan in the 1980s because of civil war and U.S. sanctions. China took advantage of the situation and invested massively, building oil wells, a refinery, and a huge pipeline to Port Sudan. Thanks to China, Sudan has been able to export oil, and Khartoum is experiencing an economic boom that makes it seem like an African Dubai.

Of course, this situation captures perfectly the problems inherent in China's approach in Africa. On one hand, China has an interest in convincing Khartoum to put a definitive end to the massacres occurring in Darfur, so as not to sully its reputation as a peaceful power. On the other hand, China wants to keep political risks high enough to ensure that Chevron, Total, and Shell -- companies that once had operations in Sudan -- do not jump back in. All this is not quite a failure, but it's hardly a "miracle," either. It's proof that what's good for China may not be good for Africa, and what's good for Africa may be something no foreign power, even one as ambitious as China, is able to deliver.

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