Investment with no strings

AP

President Jacob Zuma shakes hand with his Chinese counterpart, Hu Jintao, at the 5th Ministerial Conference of the Forum on China-Africa Co-operation held at the Great Hall of the People in Beijing, last week.

Chinese Foreign Minister Yang Jiechi said at a joint press conference in Beijing last week that China and other countries should co-operate rather than compete as development partners for Africa.

He was speaking at a joint press conference with South Africa’s International Relations and Co-operation Minister Maite Nkoana-Mashabane after the fifth ministerial conference of the Forum for China-Africa Co-operation.

“We hope China and others will learn from each other to jointly contribute to the development… of Africa,” Yang said.

Chinese President Hu Jintao had the day before announced a new package of measures to boost African development, including $20 billion (R165bn) in soft loans for developing infrastructure, agriculture, manufacturing, smaller businesses and training for professionals.

China has already invested heavily in Africa’s infrastructure, building roads, railways, bridges and other construction useful for economic development, as well as a few less useful, showcase projects such as stadiums and government offices.

African governments almost universally prefer Chinese development aid to that of the West, because it comes with no political strings attached.

African politicians naturally love it that China just builds the stuff without making them tick a thousand boxes on good governance and so on, the way Western development partners do. This is in line with China’s policy of non-interference in the internal affairs of African countries.

Recently, Chinese ambassador to South Africa, Tian Xuejun, said China was driving 20 percent of African economic growth.

That must largely be because of its purchase of vast amounts of African raw materials. But Chinese infrastructure has contributed.

Yet the impact of this infrastructure over time needs to be monitored. Infrastructure has to be put to use and maintained. This is not always happening.

Maybe it is not happening much at all.

In Nigeria, for example, China has built schools which are standing empty with grass growing in the gutters because the Nigerian government has not appointed teachers to use them.

Nigeria, of course, offers a much more dramatic example of a government squandering the bounty, not only of Chinese aid, but of nature.

It is Africa’s largest oil producer, sitting on some of the highest-grade crude in the world, yet it currently has no functioning oil refinery and so has to import petrol.

And that is simply because the government can’t get its act together; it certainly has more than enough revenue from its oil to build refineries, but the money gets siphoned off by corrupt officials.

It is abysmal governance that is wasting what the country has been given. If it was properly using its oil, it would not need Chinese schools at all, since it already has all the money it needs.

But, of course, governance is not something the Chinese government addresses in its aid to Africa, because of that policy of non-interference.

Back in the early days of African independence, Western donor countries and development institutions like the World Bank also focused on building infrastructure.

But they moved away from that precisely because the infrastructure eventually crumbled for want of maintenance.

That was partly the fault of bad planning by the donors, who hadn’t provided for the long-term cost of normal maintenance in their aid packages.

However it was also the result of corruption and ineptness by the governments receiving the aid.

Which was why Western governments started moving away from hard infrastructure and into soft infrastructure, including training, but also trying to encourage good, clean governance.

Which makes you wonder about Foreign Minister Yang’s suggestion that China and Africa’s development partners – including Western ones – should learn from each other about how best to help develop Africa.

Is this something that China will learn from the West about aid conditionality and imposing some sort of control on their investments? On the point that matters most, they seem to be irreconcilably opposed.

Perhaps Beijing has already studied the history of Western aid to Africa and concluded that the governance conditionalities that Western governments imposed have not really worked either.

Whereas non-conditionality at least wins you friends.