Staff Writer Jack Ford examines China’s economic role in Africa, weighing the evidence on firms, lending, and value transfer against the promises of ‘win-win’ cooperation and the charge of exploitation, before ultimately paralleling Chinese and Western involvement.
Within the cavernous enclosure at the heart of Great Zimbabwe – the ancient capital of the Karanga Kingdom – shards of pottery were unearthed. These fragments, under closer analysis, were of foreign origin – a ‘shadow-blue’, translucent character. Their various points of origin are over 10,000 kilometres away: the kilns of Longquan, Zhuangbian, and Jingdezhen. These remnants were once part of complete Qingbai porcelain, a prized commodity traded across the Maritime Silk Road.
Qingbai porcelain, among great quantities of other Chinese commodities, was carried in the vast holds of Arab, Indian, and Persian cargo vessels overseas. The island of Kilwa Kisiwani, off the coast of modern Tanzania, was once the seat of a Swahili trading empire. Goods were received here and then diffused overland – traded for quantities of gold from Great Zimbabwe and Mapungubwe. This mutual exchange of gold for porcelain is but one instance in the almost-2000-year history of Afro-Sino trade.
Over millennia, envoys were dispatched from courts across East Africa; from port cities across the coasts of Egypt, Kenya, Somalia, and Ethiopia. In kind, imperial Chinese diplomats voyaged Westward to Africa. The parallel journeys of the Ming Dynasty treasure fleet and the following Swahili Coast delegation illustrate this dynamic of exchange, with the former engaging in diplomacy, trade, and influence building on the African continent under Admiral Zheng He. Meanwhile, the latter, under the command of Swahili sultans and diplomats, (from numerous city states including Malindi, Mogadishu, and Barawa) carried immense volumes of trade and diplomatic presence into the Chinese imperial court.
The nature of this trade, explored by Dr Herman Kiriama, stands to contrast the attitudes of European contact – particularly with the Portuguese – marked by arrogance and violence. A mutual understanding developed in the years before the fifteenth century. Naturally, this was not without a degree of ethnocentrism, which Dr Li Anshang describes as a ‘characteristic of all isolated peoples‘.
This is the historical framework through which contemporary Afro-Sino relations justify themselves, much in the same context as the Belt-And-Road Initiative (BRI) – a continuation of a pre-existing dynamic. The nature of this official self-justification by Chinese officials is a subject I have covered extensively in the article ‘A China Ascendant – An Imperial Force?‘, particularly with respect to the BRI.
Though supporters herald a claim of mutual benefit, many voices, particularly in the West, claim that Afro-Sino relations are an exploitative affair, particularly with respect to the actions of Chinese firms, as well as wider state policy. This article seeks to evaluate the evidence of Chinese contemporary activity on the continent, and ultimately compare the activity of the West to the activity of China within Africa.
The Role of Chinese Firms
The primary way in which China currently engages with Africa is through the actions of around 10,000 firms, with 90% privately owned. This differs drastically to its actions in other continents; for instance in Latin America, 71% of firms are state-owned, while in Europe there is a mix of private and public. The closest parallel to Africa is South East Asia, wherein tens of thousands of privately owned Chinese firms operate. These firms are not a monolith, and their actions can differ widely from one another. Attempting to differentiate between state-endorsed and solely private action within Africa is very difficult as the label of ‘Belt-And-Road’ can be added following a project’s inception and can be retroactively removed.
Thus, we must look at the actions of Chinese firms on the continent on aggregate, primarily through the work of Dr Linda Calabrese, whose scoping review into over 100 case studies across the continent serves as foundation for this next section.
‘Economic Transformation’
A useful measure of the development of any country is economic transformation: broken down into structural change within the economy, and transformation within economic sectors themselves. The former is the movement of labour and capital into more productive industries, while the latter is increasing the productivity of existing industries. Hence, a measure of the success of Chinese involvement, through firms, is whether it contributes to economic transformation.
On the subject of structural change, we must look at the key areas of trade, investment, and infrastructure.
Trade with China has a mixed impact on African economies. Trade provides capital goods, increased competition, and skills upgrading to increase productivity. However, there is scholarship surrounding the process of Chinese ‘displacement’ having adverse effect on middle-income/emerging industrial economies, pushing them to remain in the primary (extraction-based) sector. How large a role China plays in this process of ‘displacement’ is contested in scholarship – however, it is a potential factor.
Meanwhile, investment and infrastructure are, on the whole, described as catalysts for increasing productivity. Chinese net investment in infrastructure dwarfs overall Foreign Direct Investment. Investment is increasing structural change, while infrastructure is ‘promoting export diversification & supporting the development of many productive sectors’. A real-world example of this Chinese infrastructural success is its support of Ethiopian and Angolan manufacturing, where Chinese infrastructure provides the spine for the manufacture of building materials.
Secondly, the area of within-sector analysis must be analysed through the processes of capacity building, spillover, and innovation.
Largely, attempts of Chinese firms to enhance the ‘capacity’ of African employees and firms have been failures. Chinese firms do attempt to make inroads into knowledge transfer through ‘on-the-job training’ and vocational schools, but these are hindered by a high turnover rate for employees. This high-turnover rate is a dynamic of the labour market, not a result of Chinese action. Moreover, a structural inequality exists in Chinese firms themselves: Chinese executives often fill the high-skill roles. African managers who are hired often act as mediators, not production managers. Hence, little capacity is transferred.
Spillover refers to the spread of knowledge and economic results beyond their initial targets. This is measured at both the sector level and the level of the firm. At the sector-level, the primary question is whether Chinese clients and firms benefit from spillover more than African countries themselves. A trend is particularly evident in the construction sector, wherein China occupies over half of all internationally contracted construction.
Structural barriers to entry for African investment, namely ‘too high of a price’, are evident across a few examples. These barriers are not purely the result of Chinese firms, but of African government policy: the Ethiopian ‘Special Economic Zone’ involved local firms barred from entry by high-tariff entry costs, as the government desired the investment of Chinese capital. Even if potentially raising local productivity, the benefit actually received by locals is a subject of debate.
Other barriers to entry for domestic firms erected by African governments include Angola’s oil negotiations with China, and the standard-gauge railway project in Kenya: the former creating an ‘enclave economy’ bypassing local firms, and the latter creating essentially a monopoly for Chinese construction. These barriers place emphasis on structural change, rather than within-sector transformation.
Meanwhile, smaller Chinese firms make very little impact on sector spillover, and transfer of knowledge proves inconsequential.
Research into innovative investment yields mixed findings: trade can contribute to innovation through the introduction of appropriate new technology, thus increasing productivity. However, the impact of this phenomenon is contested.
Mining in Zambia
Another work crucial to understanding the dynamic of ‘China in Africa’ is Dr Ching Kwan Lee’s ‘The Specter of Global China‘, which focuses on the mining and construction industries in Zambia in a comparative ethnographic study between Western and Chinese firm involvement.
The conclusion Lee reaches is that Western and Chinese firms differ across ‘three moments of capital’: driving motives behind action (accumulation), styles of production, and different philosophies of management. This ultimately yielded the result that ‘Chinese state capital, rather than being more dominant and influential, has made more compromises to accommodate Zambian state and labour demands than global capital has’
The Zambian emphasis is on the synergy of state and society, not bureaucratic autonomy and capacity, to leverage Chinese state capital.
In regards to the inherent differences in the actions of Western and Chinese firms, Lee notes that global capital seeks profit-maximisation exclusively, while Chinese SOEs seek other strategic goals & forms of ‘capital’ (political capital and resource access in the long term).
The pair also have different production regimes. The Chinese operate under a long term ‘productionist orientation’, which emphasises stability. Meanwhile global capital works in a ‘trader mentality’, that pursues short-termism for processing copper for sale as soon as possible. Despite these differences, cross industry variations in Zambia itself mean that workers in mining are better off owing to unionism, organisation, and state emphasis (unlike their counterparts in construction).
Lee makes emphasis on the different ethoses of production with the image of the ‘China House’ – a dorm where Chinese employees live together as a counterpoint to global capital’s individual careerism, in the form of a ‘collective asceticism’ – a disciplined, group-oriented work culture to fulfil a notion of national duty. This ethos is not without conflict with Zambian workers.
A further comparison between Western and Chinese engagement on the continent (beyond the single case study of Zambia) will be continued over the next few sections.
Ultimately, Lee also argues against the mainstream liberal position that China engages in ‘neo-colonialism’ in Africa, stating there is neither economic incentive, nor empirical evidence of such a process.
Mining in the DRC
The nature of Chinese ‘concessions’ in Africa is also reflected in the events in the Democratic Republic of the Congo between 2008 and 2024.
The overarching case is the renegotiated ‘Sicomines’ agreement between the DRC and China. The initial deal in 2008 was regarded as the ‘contract of the century’, giving Chinese investors a 68% stake in the copper and cobalt mining in the DRC. This ultimately yielded $10 billion in profits for Chinese companies, and only $822 million in infrastructure.
In 2009, the IMF/World Bank pressured the Congo to renegotiate the terms of Chinese loans in the Sicomines deal, forcing Western terms onto a Chinese deal, even if as a result of legitimate concerns surrounding debt sustainability.
In 2017, the DRC ordered Sicomines to cease exporting unprocessed cobalt and copper, and to refine it within the country, mandating value-addition within its own borders. Though ultimately this served as a political ‘warning shot’, it is part of a long-standing DRC precedent to assert its sovereignty through leveraging government regulation. This assertion allows renegotiation of investment and existing deals with partners (such cases also occurred in the 2013 ‘blanket ban’, the 2020 ‘indefinite waiver’, and in the August 2026 ‘ban on copper and cobalt concentrate exports’ and further legal audits of Sicomines).
A 2023 settlement was reached between Chinese conglomerate CMOC, and Congolese state-owned ‘Gécamines’, wherein the former paid $2 billion to end a dispute over the ‘Tenke Fungurume’ mine.
In 2024, more substantively, a Congolese state investigation into the Sicomines agreement produced a renegotiation with Chinese firms pledging infrastructure investment to $7 billion, $324 million for road construction, and 1.2% royalties per annum for the Congolese government.
Ultimately, the terms of the deal are still controversial, with critics arguing it lacks transparency, and remains unfavourable to the DRC. Meanwhile, supporters claim that it is a case of ‘win-win’ diplomacy, financing infrastructure in a country emerging from civil war that would not be able to access such financing via traditional means.
Overall, the picture of Chinese firms in Africa is extremely complex. Evidence points toward an overall positive impact on structural change thanks to both firm activity, and the pressures of individual African governments. However, despite repeated action by specific African governments (namely the DRC), within-sector transformation has largely been a failure, owing to labour market dynamics, government barriers, as well as shortcomings at the level of the firms themselves. In the case of Zambia, Chinese investment is evidenced as a preferable alternative to the character of Western capital, while the various negotiations in the Congo complicate this picture.
Wider Policy Dynamics
FOCAC, or the Forum on China-Africa Cooperation, is the primary Chinese-driven platform for dialogue and economic collaboration with Africa. It is driven by a number of claims familiar to those who have read my other articles: ‘win-win’ diplomacy, people-to-people exchange, non-interference, and a ‘reform of global governance’ in providing an ‘alternative path to modernisation’ for African states. These ideological goals of ‘South-South cooperation’ are driven through tangible economic/diplomatic channels, which involve closer alignment of long term Chinese plans with the African Union’s planned continental growth.
In practice, this cooperation mostly entails loans: China is the largest official bilateral creditor to Africa. Between 2000-2024, 1,319 loans were made to 49 African governments and 7 regional institutions at a total commitment value of $180.87 billion. As of 2022 this was 64% of the World Bank’s $264 billion (2000-2022), and five times the African Development Bank’s sovereign lending to Africa. The majority of this funding went toward energy and transport, while the largest recipients are Angola, Ethiopia, Egypt, Nigeria, Kenya, and Zambia.
The nature of Chinese loans is a subject I explored in the article ‘A China Ascendant – An Imperial Project?’. It is important to note that loan practices are not fixed and vary greatly on a case-by-case basis. However, some stipulations of Chinese lending include: loans carrying commercial interest rates, demanding repayment following significant policy changes, and restricting collective loan restructuring via the Paris Club. These practices are self-justified through the process of ‘risk-management’ – lending to debtors no others will.
A ONE Data report (‘The Great Reversal’) also found that African nations have become net payers, not net recipients of loans from an inflow of $30 billion between 2015 and 2019 to an outflow of $22.1 billion between 2020 and 2024. This is owing to ‘fewer new loans, and previously lent money being serviced.’
Essentially, the presence of Chinese loans is diminishing, meanwhile the continent shifts back toward World Bank and IMF lending (increased net financing by 124% in the same period). A shift ultimately driven by necessity over preference.
As a wider potential hypothesis – under distress, partly from the pressure of servicing Chinese debt, African nations are compelled to take the route of IMF restructuring. This restructuring is made ever more complex owing to the ‘creative design‘ of Chinese loans, with Chinese creditors often sitting outside of the restructuring process altogether.
This is embodied in the example of Zambia, whose wider sovereign debt crisis (not only due to Chinese debt servicing) in 2020 led to a turn to the IMF in 2022. Over the following period, neoliberal structural policies were enforced, including the building of forex exchange reserves, and pro-cyclical budget cuts, before a process of ultimate joint restructuring by a committee co-chaired by both China and France in 2023.
This diminished Chinese sovereign lending, however, has been replaced with a record investment into infrastructure via the Belt-And-Road Initiative in its campaign of ‘small and beautiful’ projects, of which Africa is the largest recipient.
Chinese and Western multilateral loans fundamentally differ from one another. The former uses commercial rate lending, without the infamous neoliberal ‘policy conditionality’ of Western loans. Meanwhile, the latter uses concessional rates with the stipulation of broad policy change.
Explored in detail by Dr Folashadé Soulé, agency in the face of this seeming lending dilemma is widespread and across all levels of African societies, all the way from presidential offices to non-organised civic actors: President Kenyatta of Kenya’s personal championing of the Standard-Gauge Railway project, successful negotiation by Ethiopian bureaucrats to reduce the interest rates for Adama wind projects, Zimbabwean Environmental Law protests forcing a ban on Chinese coal mining in national parks.
This agency is not a reactive process, but is an active process of resisting constraint, and is inherently non-monolithic – highly dependent on the material circumstances from which it is birthed.
A Comparison of Unequal Exchanges
The question of Unequal Exchange is also vital to parse the relationship between Africa and China. In the first part of this exploration, I made particular note of the extent that Western nations act as beneficiaries of Unequal Exchange. The data from the work of Andrea Ricci once again becomes of vital importance: in the single year of 2017, Ricci states that 38.6% of North African domestic GDP was drained by Unequal Exchange to the ‘Centre’, with the same true for 8.7% of Sub-Saharan GDP (the latter a smaller figure owing to reduced integration into the world economic system). The primary beneficiaries within this ‘Centre’ are named as North America, Western Europe, and the European Monetary Union.
Some academics claim that China is emerging as a ‘semi-periphery’ nation – in a grey area between core and periphery. Naturally, in this position, China is entangled in the web of Unequal Exchange to some extent. The scale of the particular Africa-China drain remains mostly unexplored. However, a paper by Dr Komala Dzigbede tackles the subject: between the years of 1995-2015, Dzigbede estimates that 2.5% of African total gross GDP was lost to Unequal Exchange with China.
The two methods used by the respective authors are of the same family, both focusing on exchange-rate deviation, while both also adjust for labour productivity. However, Ricci adds ‘global value chain decomposition’ to his method, which shows how value is captured at specific stages like manufacturing and marketing. There is a vast gulf between the two figures of extraction: 2.5% of total cumulative GDP extracted by China over the span of 21 years, while the Global ‘Centre’ extracts 8.7% of Sub-Saharan African GDP and 38.6% of North African GDP in a single year (2017). To render this in comparative terms, this is China extracting 0.118% of African GDP per year (not accounting for change in the drain), while the ‘Centre’ extracts 8.7% and 38.6% respectively.
With respect to China, 83.2% of its extraction has occurred in the final six years (inclusive) of the window between 2010-2015: an acceleration of drain. If we account for this acceleration, in the first 15 years, the intensity of loss was approximately 0.028% per year, while in the 6 years following the financial crisis, the annual loss jumped to 0.347% per year.
The value extracted by China per year, even in the ‘accelerated period’ is still 25 times smaller than the same extracted by the nations of the ‘Centre’ (comparing the 0.347% and 8.7% figures).
This accelerated drain is explained through a number of factors following 2008 including China’s status as a net importer of goods, ‘large appetites’ for African national resources, and the necessity to export its industrial overcapacity abroad. Though generating foreign exchange for Africa, Dzigbede claims that rules of engagement favoured China, producing larger aggregate unrecorded value transfers to China. This drain as ‘net importer’ was deepened by China’s rising productivity, and advantage in exchange rate deviation, which is the the gap between exchange rate and purchasing power. Meanwhile, Ricci still positions China as a net loser of value, with 4.6% of its GDP drained to the centre, further complicating the picture.
Evaluation of Character
The modern dynamic between China and Africa is not the exchange of works of Qingbai porcelain for gold, but of loans and infrastructure for natural resources. The defining feature of this dynamic is African nations’ active leverage, resistance, and shaping of policy to their own developmental ends. These nations are neither passive ‘victim’ nor pawns in a ‘game between great powers’.
Paralleled with the paternalistic offer of the West, Chinese foreign policy toward Africa stands as a radical alternative, not because it is benevolent, but because it is transactional. Chinese capital, despite its numerous pitfalls, offers tangible infrastructure, a larger degree of non-interference, structural economic change, and a drastically lower rate of Unequal Exchange. This flawed pragmatism is a fundamental shift when compared with the policy conditionality and inherently unstable neoliberal financialisation of Western counterparts.
Looking ahead, the future of Chinese-African relations, and for that matter the relations between Africa and the West, is not determined by the angling of foreign lenders, but the active shaping of the continent’s future on its own terms as we enter the era of global multipolarity.
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