Chinese Aid, Trade and Investment in Africa A case study of Tanzania

1. Chinese Aid, Trade and Investment in AfricaA case study of Tanzania International Development Studies Lecture Series 11-11-2010 Sanne van Keulen

2. “China is legitimizing and encouraging Africa’s most repressive regimes, thereby increasing the likelihood of weak and failed states” Brookes & Hye Shin (2006) “China is marking a path for other nations around the world who are trying to figure out not simply how to develop their countries, but also how to fit into the international order in a way that allows them to be truly independent, to protect their way of life and political choices in a world with a single massively powerful centre of gravity” Joshua Cooper Ramo (2004) “China is both a tantalizing opportunity and a terrifying threat for Africa“ Moeletsi Mbeki

3. “Much of the commentary on China in Africa focuses either on assessing how Western capital’s interest might be affected, or on denouncing China for practices that have for centuries been the norm for US and European powers – support for dictators, callous destruction of the environment, exploitation of minerals, and complete disregard for human rights. Lost in the cacophony has been the voice of independent African analysts and activists […] There is no single ‘African view’ about China in Africa […] .” Firoze Manji in Manji & Marks (2007)

4. Theoretical background • China’s re-entrance in Africa • China’s motives and goals • Conjuncture between aid, trade and investments • Competitive versus complementarity • Infrastructure and development

5. Trends in Chinese Investment (FDI)

6. Trends in Chinese Investment (FDI)

7. Trends in Sino-Tanzanian Trade

8. Trends in Sino-Tanzanian Trade

9. Trends in Chinese Aid • Pattern of Sino-Tanzanian agreements 1960-present • Cooperation in the area of infrastructure (roads and railways, communication, energy, water supply), agriculture, medical assistance, industrial development and cultural cooperation • China’s role in Tanzania’s donor community • Aid for trade ‘deals’ • The big unknown

10. Infrastructure development “Admittedly, Chinese enterprises have contributed to swift improvements in infrastructure and hence to economic growth in Africa, generally acting in the context of projects negotiated at an intergovernmental level. There is a risk, however, of domestic construction companies being crowded out, and there are sizable shortfalls in the transfer of know-how and employment of local workers.” Asche and Schüller (2008) • Two perspectives: economic development through infrastructure assets and impact on the construction market • Public versus private investment • Chinese market share in civil works • Market entry strategy

11. Stakeholder Perspectives From friendship to business The informal economy How Chinese companies operate in the market Lack of understanding Organization of work and work ethics The role of the Tanzanian government Threats and opportunities for economic development

12. Conclusions Complex and contradictory effects Competition and complementarity Role of the Tanzanian government Lack of understanding and dialogue

13. Questions, Comments? S_vankeulen@hotmail.com http://www.ccs.org.za/wp-content/uploads/2010/05/China_Monitor_APRIL_2010-SCEDIT.pdf