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“China’s Growth: Implications for Poverty Reduction in SADC”. Presentation to SARPN Dr Martyn J. Davies
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“China’s Growth: Implications for Poverty Reduction in SADC” Presentation to SARPN Dr Martyn J. Davies Director, Centre for Chinese Studies, CEO, Emerging Market Focus, Senior Lecturer, Gordon Institute of Business Science 29th March 2006
Some questions to ponder this afternoon: • How will China’s growth impact us? • What are China’s motivations in Africa? • Can Africa compete commercially? • What drives development? • Is Africa’s approach to development flawed? • What is China’s economic destination? • What if China ran Africa? Centre for Chinese Studies
“I see growing on the horizon the greater peril than Germany or Japan ever were…our terrible enemy, America” Enoch Powell (1912-1998), British MP Centre for Chinese Studies
China’s Impact on the Global Economy • Shift of manufacturing • Consumer market • Commodity “super cycle” • Emerging multinationals • China and the global value chain • Intense competition • Marginalization of SEMs Centre for Chinese Studies
“Is Africa a continent that shuns rather than embraces foreign competition? Centre for Chinese Studies
China’s Emerging Multinationals Centre for Chinese Studies
But Chinese SOE firms are largely non-collaborative in nature. Why? • Politically determined business models • Do they seek profit? • A mercantilist approach to business Centre for Chinese Studies
China’s Growth Trajectory Source: www.gs.com Centre for Chinese Studies
Questioning the WBM…. A new model for development Q. What if the Chinese ran Malawi? Q. The role of the state as a driver of development? Q. Reaganism vs Dengism Centre for Chinese Studies
China’s “Marketized” Economy Free Market • Open to foreign investment • Full competition • Limited state involvement Government controlled • Closed to foreign investment • Limited/no competition • High state involvement Consumer electronics Light industrial manufacturing Government agencies Finance, insurance Electronics, telecom equipment Real estate Radio, film, TV Automotive Wholesale/retail trade, catering services Postal, telecom services Apparel, textiles Size of circle indicates sector’s contribution to GDP 3% 5% 15%