Soft Power. Hard Money.
By Global Journalist Staff Posted Sep 20 2012
International headlines from recent years show that it’s no secret China is looking to form a stronger alliance with Africa, particularly for the country’s rich natural resources. The nation is honing in on Africa’s financial opportunities, especially after the economic downturn that spread across the globe in 2008 left many African nations looking for support, according to the Huffington Post. But there are conflicting reports about whether the Chinese have become a welcome presence or a detriment to the continent.
Nearly 900 Chinese companies were involved in African investments. Since 2007, China’s government has invested over $20 billion. The World Bank has contributed $17 billion.
Africa’s mineral reserves account for a leading majority of the world’s reserves. According to a 2011 study, more than half of the world’s reserves of platinum, diamonds and cobalt come from Africa. Platinum is used to produce various technological products and vehicle parts. Africa has almost 90 percent of the world’s platinum reserves. Africa accounts for more than half of the world’s supply in diamonds and cobalt. China is seeking to gain a competitive foothold in obtaining these reserves.
China’s trade with Africa has sparked a geopolitical interest as well.
In July during the Forum on China-Africa Cooperation in Beijing, China announced that they are offering Africa $20 billion in loans over the next three years. This is the fifth China-Africa forum, according to the Huffington Post. China’s President Hu Jintao says these loans will go toward medium-sized businesses, infrastructure and agriculture.
China says Africa is also benefiting from this new trade alliance. As China builds African infrastructure, Africa will in turn ship goods to China. However, Africa is not entirely pleased with Chinese trade. Some Africans have protested against Chinese companies saying their help does not lead to better wages or jobs, according to the Huffington Post. Some African attitudes are negative toward China, and some cite that Chinese goods are examples of shoddy work, according to an Economist article. Other sources have said that the Chinese style of business is unfair.
In recent years, Africans have become less welcoming of Chinese influence. China argues that they are aiding Africa through trade. The East Asian country is currently Africa’s biggest trading partner and buys more than a third of Africa’s oil, according to the Economist. Money from China has paid for new schools in Africa, as well as hospitals.
Good or bad, one thing seems certain: Chinese officials have said that their presence in the continent will continue to grow.
Explore China's history in the African continent with our interactive timeline