As the Chinese continue to
expand their African activities,
there is vast opportunity
for Africa to develop
production facilities locally
– but rather than try to go it
alone, they should do so in
conjunction with their Chinese
partnerships.
That’s the view of Hannah
Edinger, a research and
strategy specialist with Frontier
Advisor, who believes that
as China matures and its
interest in Africa’s resources
grows there will be major
opportunities to have offshore
production hubs for the
Chinese on the continent.
Most experts agree that
true development only comes
when you can measure the
true extent of manufacturing
and service delivery in the
economy rather than just
looking at resource extraction.
But, said Edinger, it was
time that African countries
started thinking out of the box
to find ways of benefiting for
far longer than what the current
situation will allow.
Peter Draper, director of
Tutwa Consulting, agrees
saying there is less optimism
now around China’s growth
than several years ago.
“There is a shift taking
place in China where they are
moving away from exportled
industrialisation to a
greater focus on domestic
consumption. That means the
cost structure in China is rising
and low wage, labour-intensive
factories are moving offshore
to Bangladesh, Sri Lanka and
Vietnam. The question arises
why not also to sub-Saharan
Africa? Why can we not look
at developing these hubs for the
Chinese right here? We should
be encouraging this as it offers
major opportunities.”
Both Edinger and Draper
agree that the East African
countries are leading the way
when it comes to extracting as
much benefit as possible from
their Chinese contracts.
“If one looks at the EAC one
can see how they are far ahead
of SADC and Comesa in terms
of policy and implementation
when it comes to working
together as a region and
finding beneficiation. They are
extremely proactive in terms of
infrastructural development.”
According to Edinger,
the countries in this region
are committed to working
together to create an enabling
environment to attract
investors.
“If one looks at countries
such as Zambia and Ethiopia,
even Nigeria in the West,
they are negotiating – with
the help of China – economic
zones in their countries where
production facilities can
be erected.”
Ultimately, she said, it
made sense for the Chinese
as well to extract resources
locally, manufacture them
here and then sell the final
product on the continent rather
than moving it back and forth
to the East.
CAPTION
Hannah Edinger ... ‘China
moving away from export-led
industrialisation.’
