The Impact of Chinese Investment in Africa

Abstract

The purpose of this paper is to explore the increasingly important economic and business relationship between the People's Republic of China and the countries of Africa. Our focus is on how this partnership manifests itself in investments. The research questions are: first, how has the relationship changed over time and second, from an African perspective has this relationship been beneficial? Finally, how has the recent economic downturn affected their partnership? Our investigation shows that Chinese investment has been motivated by a desire to access critical resources (oil, bauxite, etc.). The Chinese approach was been to downplay political issues (e.g., human rights). Although recipient African nations have received investment inflows, they have come with certain drawbacks. For instance, they have negatively impacted local trade and commerce. Also, in some cases African labor has not benefited from Chinese investment.

Consumer involvement and marketing in Africa: some directions for future research

“…Although there are differences in economic activities between countries in Africa with some countries like South Africa doing better than others, it has been noted that the African collective gross domestic product (GDP) reached $1.6 trillion in 2008, and Africa, as a continent, and Asia are the only two economic regions where GDP rose during the global economic recession experienced in 2009 (Dörr et al ., 2010). In fact, evidence suggests that Africa has the highest return on foreign direct investment with figures ranging from 29% in 1990 to 40% in 2005 (Sautman and Hairong, 2007 in Adisu et al ., 2010). Bringing the foregoing to the level of consumer marketing in which consumer involvement is embedded; it could be argued that there is a promising avenue for a variety of marketing activities in the continent.…”

“…It has been noted that in 2005, the EU contributed to the United Nations's project on ‘Advancing Capacity, Partnership and Knowledge to support Climate change Adaptation in Africa and Asia’ through funding by the European Development Fund (Scheipers and Sicurelli, 2008). Similarly, the economic and political relationship between Africa and China cannot be ignored in terms of scale and significance (Gbadamosi and Oniku, 2009; Adisu et al ., 2010). The movement of Chinese companies into African countries is remarkable especially in the areas of oil extraction, construction and mining (Broadman, 2007 in Adisu et al ., 2010).…”

“…Similarly, the economic and political relationship between Africa and China cannot be ignored in terms of scale and significance (Gbadamosi and Oniku, 2009; Adisu et al ., 2010). The movement of Chinese companies into African countries is remarkable especially in the areas of oil extraction, construction and mining (Broadman, 2007 in Adisu et al ., 2010). The trade between China and Africa has been noted to have grown from US$3 billion in 1995 to US$55 billion in 2006 (Adisu et al ., 2010).…”

“…The movement of Chinese companies into African countries is remarkable especially in the areas of oil extraction, construction and mining (Broadman, 2007 in Adisu et al ., 2010). The trade between China and Africa has been noted to have grown from US$3 billion in 1995 to US$55 billion in 2006 (Adisu et al ., 2010). The implication of this is far‐reaching for marketing and economic activities in these regions.…”

Tokunbo and Chinco economies in Nigeria: rethinking encounters and continuities in local economic transformations

“…Akinrinade and Ogen (2008) argue that China has been pursuing a policy of de-industrialisation in the Nigeria, maintaining that there exist forces of exploitative Chinese neo-liberalism masquerading as South-South co-operation. Chinco is believed to be based on poor labour practice, and the goods circulating within it are perceived to be in competition with local goods, having consequences for the survival of local factories (Adisu, et al, 2010). The Chinese have also been accused of stealing job opportunities from the local population (Burgis, 2010;Morning Whistle, 2012) and criticisms of "dumping" is common (Michael, 2014).…”