China in Africa
2. Africa in the Context of China's Resource Acquisition Requrements
Fundamental
structural
economic
reforms
undertaken
by
the
Chinse
government
duringthe
1980s
and
1990s,
transformed
what
was
an
essentially
stagnating
agrarian
economyinto
the
worlds
fastest
growing
economy
third
in
size
only
to
Japan
and
The
united
States(US).
Since
the
1980s
China
has
consistently
enjoyed
an
average
economic
growth
rate
ofover
8
percent
per
annum.
A
signal
of
China’s
growing
economic
strength
was
its
rising
need
for
oil
imports.
In
1993China
became
a
net
importer
of
oil,
and
in
2003,
overtook
Japan
to
become
the
world’ssecond
consumer
of
oil
behind
the
US.
Between
1978
and
2000,
energy
demand
inChina
grew
at
4
percent
per
year;
but
since
2001,
demand
has
soared
to
13
percent
peryear,
outpacing
annual
economic
growth.
China
consumed
an
estimated
7,8
millionbarrels
per
day
(bpd)
of
oil
in
2008.
However,
during
that
same
year,
China
produced
onlyan
estimated
4
million
bpd
of
total
oil
liquids,
of
which
96
percent
was
crude
oil.
China’snet
oil
imports
were
approximately
3,9
million
bpd
in
2008,
making
it
the
third-largest
netoil
importer
in
the
world
behind
the
United
States
and
Japan.
EIA
forecasts
that
China’s
oilconsumption
will
continue
to
grow
during
2009
and
2010,
with
oil
demand
reaching
8,2million
bpd
2010.
This
anticipated
growth
of
over
390
000
bpd
between
2008
and
2010represents
31
percent
of
projected
world
oil
demand
growth
in
the
non-OECD
countries
forthe
2-year
period
according
to
the
July
2009
Short-Term
Energy
Outlook.
On
6
October,Dow
Jones
Commodities
News
Service
quoting
Comex
stated
that
China’s
oilconsumption
in
the
first
quarter
of
2010
would
reach
8,36
billion
bpd.
US
crude
oilconsumption
is
roughly
21
million
bpd.
Not
surprisingly
China
considers
oil
procurement
a
matter
of
“national
security,
using
allstate
resources
to
satisfy
the
nation’s
need
for
energy.”
An
indication
of
the
potentialenergy
crisis
China
faces
is
illustrated
by
the
projected
growth
of
motor
vehicles
in
thecountry
from
27
million
in
2004
to
an
estimated
300
million
in
2030.
By
2030,
China
willneed
an
oil
“supplier
the
size
of
Saudi
Arabia
to
meet
demand,
and
even
this
may
be
aconservative
assessment.
China's Oil Production and Consumption, 1986-2006
Source: EIA International Retroleum
The
bulk
of
accountability
for
the
enormous
energy
demands
in
China
rests
on
its
renewedfocus
on
energy-intensive
industry
–
led
by
China’s
obsession
with
the
manufacture
ofsteel
and
related
metal
products.
Industry
in
China
consumes
up
to
70
percent
of
totalconsumption,
followed
by
residential
at
10
percent,
transportation
7
percent
andcommercial
at
just
2
percent.
But
industrial
production
also
generates
some
of
the
highestprofit
margins,
outstripping
the
more
labour
intensive
but
less
energy
intensive
lightindustries
like
textiles
and
electronic/computer
machinery
and
production.
Not
only
doesthe
industrial
base
deliver
so
many
of
the
manufactured
goods
for
the
rest
of
the
world
butit
also
must
support
the
enormous
urbanization
movement
which
now
accounts
for
over
39percent
of
the
population,
and
the
infrastructure
and
building
that
will
support
it.
Consequently,
China
is
the
number
one
steel
manufacturer
and
exporter
in
the
world,accounting
for
34,6
percent
of
the
world’s
share
of
production.
Iron
and
steel,
alone,account
for
16
percent
of
china’s
energy
consumption
(total
heavy
industry
accounts
for
54percent
of
total
consumption).”
The
growth
of
the
industrial
base
coupled
with
increasing
individual
household
wealth,places
a
great
demand
on
China
for
sourcing
both
more
raw
resources
and
exportmarkets.
China
now
imports
20
percent
of
the
world’s
fuel
and
mining
products.
It
is
theworld’s
largest
producer
and
consumer
of
coal,
the
worlds
largest
importer
of
iron
ore,
theworld’s
largest
importer
of
coking
coal,
and
so
on.
It
has
displaced
the
US
as
the
world’slargest
consumer
of
raw
materials
as
a
whole.
[Note:
According
to
the
Chinese
Ministry
of
Land
and
Natural
Resources,
by
2010domestic
crude
oil
production
will
only
be
able
to
meet
50–55
per
cent
of
demand
falling
to34–40
per
cent
by
2020;
while
domestic
iron
production
will
be
able
to
meet
38
per
cent
ofdemand
by
2010
and
only
29
per
cent
by
2020.
It
is
estimated
that
by
2010
and
2020
theshortage
of
coal
will
reach
250
million
and
700
million
tons
respectively.
So
China
islooking
to
Africa
to
address
some
of
its
short
to
long-term
needs.]
2.1. The Defining Pillars of Foreign Policy
David Zweig and Bi Jianhai writing in an article, "China's Global Hunt for Energy," in theSeptember/October 2005 issue of Foreign Affairs , state that China’s foreign policy has hadto increasingly reflect the domestic policy imperatives of ensuring a smooth uninterruptedflow of raw materials imports to satisfy its burgeoning economic growth path. This it hasdone by encouraging state-controlled companies to seek out exploration and supplycontracts with countries that produce oil, gas, and other resources. At the same time,Beijing aggressively courts the governments of those countries with diplomacy, tradedeals, debt forgiveness, and aid and security packages – an effective combination notseen in Western countries.
A second influence on China’s foreign policy rests with a different aspect of its economicgrowth – increasing its global competitiveness and reframing its pattern of growth. SinceChina’s accession to the World Trade Organization (WTO) in 2001, and the establishmentof the official “Go Out” and buy strategy for Chinese businesses, China has beensupporting the growth of its multinationals in the international arena. The goal is toincrease domestic consumption and alleviate the constraints of export-led growth. For thisit needs to engage with global markets.
The “Go Out” policy selects 30-50 of the states best performing state-owned enterprises,which will then receive government benefits to help “develop these corporations’”technological skills and know-how, exploit China’s comparative advantages, gain accessto key inputs, open new markets abroad, create global Chinese brands, and help Chinaavoid becoming over-dependent on export-led development. A critical component of thispolicy is to “lock-in” resources that China would otherwise have to purchase on the openmarket. This is done be securing long-term supply contracts with host countries andcontrolling the chain of supply from source to end point user in China. [See below.]
Chinese banks (backed by government policies) have encouraged businesses to investand develop outside the mainland. Much of China’s foreign policy in Africa has reflectedthe strategies outlined above. The establishment of the $5 billion China-AfricaDevelopment Fund (CADF) to assist businesses willing to invest in Africa, for example, is atestament to its reevaluated economic focus on transitioning to an economy based onexpanding domestic consumption. Chinese businesses investing outside the mainlandhave been aided by the creation of Sinosure, which offers export credit insurance to helpChinese businesses obtain cheaper loans from private banks, and by offering reduced rateof loans from the China Export Import Bank and the China Development Bank (CDB). Infact, outward foreign direct investment (FDI) to Africa grew 327 percent between 2003 and2004 and there are now over 900 Chinese companies operating on the continent.
The final determinant of China’s foreign policy is diplomatic. There are two stated goals:one, to support the One China policy and further isolate Taiwan; and two, to helprebalance the hegemony of the US in international relations. In its role as “anti imperialistcounterweight to the West,” China has brokered diplomatic ties with resource richcountries that bear pariah status, but bring much needed resources to China. Here Africaagain plays a crucial role.
A secondary aspect to China’s diplomatic outreach is to reinforce a new developmentmodel for developing countries, one mirrored on its own focus of economic growth beforedemocratic growth. Explained by Professor Yang Guang at the Africa-China-US TrilateralDialogue held in Washington DC in 2007, there must be a balance of reform, stability anddevelopment…that democratization should not be precondition to development.” Instead,this is allowing for countries to seek their own models applicable to their unique conditions– a strong corollary to its non-interference policy.
In Africa, this diplomatic offensive is given a measure of coherence within the politicalframework provided by such institutions as the Forum on China Africa Cooperation(FOCAC) and the China-Arab Cooperation Forum (CACF). Established in October 2000,FOCAC has taken center stage in symbolizing the new political engagement that Chinahas forged with Africa. Linked to its formation has seen an emerging consensus aroundcrucial foreign policy considerations salient to China’s geo-strategic views on resourceacquisition and the desire to change the hegemonic influence enjoyed by the West inshaping the characteristics of the current economic world order.
These include the recognition of “non-interference” as the corner-stone of bi-lateralrelations between countries, and dealing with radical Islamism, debt relief, reductions intariff barriers, immigration, peace-keeping missions and challenging the “WashingtonConsensus” which dominates the thinking of multi-lateral agencies such as theaInternational Monetary Fund (IMF) and World Bank.
Embedded in this overarching policy construct are specific institutions dealing with Africandevelopment issues such as CADF and the China-Africa Business Council (CABC) toleverage Chinese economic influence on the continent within the context of its “go-out”policy. All this is supported by a synergistic approach towards Africa coordinated in themain by the National Reform and Development Council (NDRC) and the InternationalLiaison Department (ILD) of the Chinese Communist Party (CCP) in conjunction withorgans such as the Ministry of State Security or Guangbo (MSS) and the all-powerfulMinistry of Commerce (MOFCOM), linked in turn to China’s banking behemoths. All thisprovides massive institutional backing to Chinese state owned enterprises (SOEs)breaking into African markets
Buttressing this diplomatic offensive is the principal of “non-interference” – the cornerstoneof China’s engagement with the developing world. This enables China to engage withunsavoury regimes not courted by the West. China’s strategy enables the continent’s mostdubious regimes to build up a rentier economy based on the massive exploitation ofnatural resources with very little real fixed investment flowing into that country and nopressure put on the regime to change. This is particularly so in a place like the DemocraticRepublic of Congo (DRC) where there is minimal fixed investment in mining – givenChina’s priority to beneficiate raw materials in China.
目次
- 1. Introduction
- 2. Africa in the Context of China's Resource Acquisition Requrements
- 3. The Origins of China's New Africa Policy
- 4. The Role of FOCAC
- 5. China's New Resource Acquistion Business Model
- 6. The Role of Chinese Institutions in the Acquisition of Business Intelligence
- 7. China's Energy Footprint in Africa
- 8. China's Mining Footprint in Africa
- 9. China's Telecommunications Footprint in Africa
- 10. China's Infrastructure Footprint in Africa
- 11. The Role of China's Financial Institutions
- 12. Implications for Japanese Investors
- Annexure I: The Focac Fuc Structure
- Appendix II: The Forum on China-Africa Cooperation
- Annexure III: Ministry of Commerce
- Annexure IV:Profile Chen Yuan and Chi Janxin