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Using a two-stage analytical framework and drawing on a wide range of secondary data, this article attempts to assess the likely impact of aid from China and India on the development of Africa. The framework treats aid as one of four main channels through which China and India influence the shape and performance of particular sectors and, through them, development outcomes. The first stage of analysis examines the varying patterns of Chinese and Indian aid and the multiple impacts such aid has on one key sector: manufacturing. The main findings from this level of analysis have to do with the differing patterns of Indian and Chinese aid, differences between Chinese and Indian aid, and aid from western countries, and the interconnections between the impact channels. India and China have different patterns of aid. India concentrates on nonmonetary aid mainly in the form of technical assistance and scholarships, while China offers a wider range of monetary and non-monetary aid packages,which include grants and loans for infrastructure, plant and equipment, as well as scholarships, training opportunities, and technical assistance. Chinese monetary aid is tied to the use of Chinese goods and services, and requires adherence to the 'One China' policy, but does not carry the 'good governance' conditionalities that currently characterise western donors. The impact channels of trade, FDI, aid, and migration overlap to some degree, especially in the case of China. The line between FDI and aid is often blurred, as is the line between aid and trade. The second stage of the analysis looks at the implications of Chinese and Indian aid to manufacturing for development outcomes such as growth, distribution, governance, and environment. The analysis shows clearly that the potential impact of Chinese and Indian aid on Africa is significant, but that the actual effects of these emerging donors on particular countries depends to a large extent on the institutional and structural conditions of the recipients.China and India are Africa's new donors. Both countries have recently established development cooperation programmes that particularly target Africa. India's 'Focus Africa Policy' has involved high level visits, economic and technical cooperation, and an Indian contribution to peacekeeping operations in several African countries (India, 2004). China also has a high-profile Africa Policy, adopted in early 2006, that serves as the political foundation for significant engagement with Africa.A growing literature describes these policies and analyses their motivations (e.g. Alden, 2005;Servant, 2005;Tull, 2006), but there has as yet been little attempt to assess the actual impact of Chinese and/or Indian aid on the development of the countries of Africa. Carrying out such an assessment would require detailed empirical work in a number of countries. The purpose of this paper is to lay a foundation for that empirical work by developing an overall conceptual framework and illustrating how it might be applied in a specific case. The case c...

The failure of structural adjustment programmes to promote industrialisation in Africa may be at least partly explained by the fragmentation of African business systems. In Africa, the parastatal, foreign-dominated formal and indigenous informal sectors are poorly integrated, largely as a result of the institutional environment in which they have developed. The lack of supportive financial, state and social institutions inhibits trust and accountability, and impedes the access to capital, labour market flexibility, and sub-contracting, which are needed for modern industrial development. More research is needed, both detailed studies of business systems in individual African countries, and cross-country comparisons of the linkages between the economy and the wider social and institutional environment.

While providing essential access for large portions of city populations, the quality of paratransit services in Sub-Saharan African cities is poor. Poor quality of service can be attributed to two features of the paratransit business operating model: driver remuneration on the basis of a daily 'target system'; and cash-based business management in which vehicle depreciation is ignored as an operating expense. In Kenya, the voluntary organisation of fragmented inter-city matatu businesses into Savings and Credit Cooperatives (SACCOs) has resulted in improved service, regulatory compliance and technology adoption, but little is known of how they operate. The aim of this paper is to gain insight into how the Kenyan inter-city matatu SACCOs are organised and have improved services, and to explore the transferability of this experience and the lessons it offers. The exploratory nature of the study, and constrained resources, necessitated that the research adopt a qualitative case study method. It was found that most of the case study SACCOs have addressed the root causes of poor service quality by shifting the remuneration of drivers from daily cash targets to salaries, and by requiring vehicle depreciation costing through compulsory contributions to the cooperative's capital savings from which vehicle acquisition and repair loans can be derived. Due to the particular shuttle-like nature of inter-city services and the considerable institutional support that exists in Kenya for cooperatives, the direct transfer of successes to other contexts is likely to prove difficult. Identifying the features of the inter-city SACCO model that have led to paratransit service improvements, and attempting to replicate these, may therefore be more effective than attempting to replicate the model in its entirety. These features are argued to be operator consolidation, accompanied by salaried drivers, systematic vehicle monitoring and compulsory vehicle depreciation costing. They can be adopted in other forms of paratransit organisation and regulation, but will require considerable adaptation to context.

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