• Paula

What is the relationship between Chinese investments in Africa and jobs for the African youth?...

Updated: Feb 10, 2020


Image: Africa is changing China as much as China is changing Africa (Quartz Africa, 2018)

... and what should that relationship look like?


I heard about the China in Africa podcast about 2 years ago and it has since become my favorite podcast. In many of the episodes the hosts Eric Olander and Cobus van Staden, both excellent scholars in China-Africa relations, address a constant controversy surrounding the relationship between China and African countries - the question of whether China's interest in Africa is truly a "win-win" diplomacy as China often states in its foreign policy on Africa or whether China is simply pursuing its self-interest as aggressively as any of the past powers have done. One of the episodes in the podcast that addresses this issue is titled "Is China a partner or a predator in Africa (or both)?". A different episode on the same topic is titled "Chinese and Africans are having totally different conversations about their relationship".


At a time when it feels like the balance of power is shifting from the US and Europe--the devil we know :) to China--the devil we don't know :/, it comes as no surprise that this contention should arise. China is a new player in the game but with different ideologies and with a different approach to investing in the developing world. On one hand, this debate stems from a place of both caution and curiosity where the world is not used to this "new power" just yet and is therefore cautious of its moves. But "little" time has passed to truly know the nature of the new player, and therefore we speculate. On the other hand, China is already involved in development and their undertakings thus far provide relevant grounds for the various acclaims or criticisms that it receives.


Over the past few years I have been exploring the issue of youth unemployment in Africa. Youth unemployment is a huge problem in many parts of Africa and could become even worse. The UN projects that Africa's youth population will double, and Africa will be on the path to having the largest population (mostly youth) in the world in the next 50 or so years (sooner than you might think). I find it hard to imagine how big a problem unemployment would be then compared to what it is now. Youth unemployment is such a fundamental problem because we cannot expect to end poverty when young people do not have jobs. Jobs are sources of income which pay for a myriad of life necessities. By jobs I do not mean only formal employment opportunities but also opportunities for entrepreneurship and sustainable informal employment. As a pragmatic African youth, China's increasing investments in Africa seemed like a potentially great solution to unemployment at first glance. I reckoned that Chinese infrastructure projects would employ many African engineers, architects, construction workers, data analysts, create indirect employment opportunities in education, manufacturing, and in the food industry, and result in long-term employment and economic growth for the region. However, after reading a bit more on the topic and listening to many episodes of the China-Africa podcast, I have learned that there is more to the story than a simple action-result expectation, and that a lot more needs to be done to realize such outcomes.


To begin with, a simple internet search reveals a ton of research and material that talks about how Chinese investments in Africa have been instrumental in creating job opportunities for Africans. To mention a few, surveys of employment in Chinese projects in Africa by the HKUST Institute for Emerging Markets found that more than three-quarters of workers were local. Professor Deborah Brautigam from John Hopkins also published research showing that out of the 8 countries in Africa that China had infrastructure projects in between 2010 and 2011, 6 of them employed more than 80% local workers and the remaining two employed between 50% and 70% local workers.


Yet another simple internet search also produces a ton of material on why Chinese investments in Africa are not providing employment opportunities for Africans. For example, in an article by Ariel Gandolfo of prosper.com, he talks about how Chinese construction companies have been known to ship in Chinese laborers rather than hiring local Africans. For instance, in Cameroon, low-skills construction jobs in the construction of a Seaport in 2013 largely went to Chinese workers. In Ghana, a public outcry in 2014 over the flying in of 50,000 Chinese laborers on a gold mining project led to deportations of many of the Chinese miners.


A related point on the issue of jobs is harsh working conditions and low-pay for unskilled African laborers which deter Africans from working on Chinese projects. Ariel points out that in Kenya for instance, labor disputes between local laborers and Chinese management are usually around salaries below the minimum wage, poor working conditions without holidays, housing, or medical care, and unfair termination. He mentions a case where 10 Kenyan employees were fired without notice by a Chinese company after requesting for protective gear to use when removing sewage.


Given all of these different positions on the matter, my take is that while there is credible evidence that Chinese investments do indeed provide employment opportunities for Africans, China needs to invest in tech-transfer processes to facilitate more managerial positions and long-term development for Africa. To truly involve Africa as a partner and to embody the essence of the "win-win" diplomacy that they claim to care about, China needs to re-evaluate its investment strategy for Africa and African leaders need to learn to negotiate for better deals with China. Most of the jobs that China offers young Africans are low-wage, unskilled positions. In an era where artificial intelligence and machine learning are changing the world's economic outlook, this is simply not good enough. It is particularly inadequate considering that China specifically revels in the fact that their approach to investing in Africa, takes a stab at Africa's long-term economic growth and stability as opposed to the short-term "in-and-out" module that's typically been used by the West.


If a true partnership between China and African countries is to result in mutual gains for both parties, there is need for investing in tech-transfer processes. This could be education exchange programs for Africans to study in China or to learn about Chinese technologies used in African projects. It could also be on-the-job apprenticeships to train African laborers to acquire skills that would enable them to maintain installed infrastructure projects long after China is gone or to be able to start their own projects. It could also involve contracts to share patented or intellectual property. Furthermore, if China is looking to have any return on investments from their projects, then they need to look into technology transfers. Rising debt in Africa due to Chinese investments is a real issue that they should be concerned about and institute long-term debt management strategies such as tech-transfers. Finally, China after all forces other countries that want to do business in China to share intellectual property before they are allowed to conduct business. Why shouldn't the same rules apply to China when conducting business with Africa?





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