Should African governments welcome Chinese investment?

October 11, 2021 454 views 10 comments 2 minutes reading time
Should African governments welcome Chinese investment?

Chinese investment in Africa has been increasing since 2003. It has been estimated that US$2.96 billion was invested in the continent in 2020, thus exceeding the Foreign Direct Investments (FDI) of countries such as the United States.

Chinese investment has provided numerous benefits to Africa. It has resulted in several telecommunications, infrastructure, and manufacturing projects that have in turn led to job creation. In the Ethiopian garment sector, for example, Chinese firms employed 4395 locals. Other notable projects include the construction of railway lines in Nigeria, Zambia, Ethiopia, Djibouti, and Kenya.

However, there are many who view the increase in Chinese investment with skepticism. The lack of accountability and regulatory measures for governing the use of investments results in mismanagement of Chinese-funded projects by corrupt local actors.  In addition, many argue that Sino-African trade benefits China more than it does Africa, raising the fear it could lead to some form of colonialism.

What do our readers think? Motso says “I really don’t know, because I have no idea what their intentions are, if they do invest though it should be with scrutiny because Africa has been through a lot in terms of colonization so we can’t afford to be under other countries when we can implement our own ways to save Africa.”

We spoke to the entrepreneur, and founder, and chairman of the Mo Ibrahim Foundation, Mo Ibrahim for his perspective.

We also spoke to Dr. Frannie Léautier, a leading international finance, and development expert.

Should African governments welcome Chinese investment? Is the relationship between China and Africa exploitative or beneficial? Let us know your thoughts and comments in the form below, and we’ll take them to policymakers and experts for their reactions!

Image by GovernmentZa via Flickr



Top Comment

They can invite the investment but it is equivalent to courting trouble. 😅

Here in Kenya the 80% Chinese-financed railway from Mombasa to Nairobi has already gone four times over budget, costing the country upwards of 6% of it’s GDP! Is this really value for money? Who's truly benefiting?

Chinese investment is far more honest than European.

Countries across Africa are chasing dreams of a better economic future while burying themselves in massive amounts of infrastructure-induced debt that they may not be able to actually afford.

We should learn to stand on our own two feet! All they want are our resources. They should invest in our knowledge.

Yes they should! We give them access to our markets, they build infrastructure. It's far better than just receiving donations from the West.

How much of this investment is actually finding its way into the public purse? I suspect our leaders are getting very rich off these deals, but we the people not so much.

Ask yourselves why China's investing across Africa. They need natural resources and we have them. The true question is whether African countries are getting a good deal. Somehow I doubt it...

Yes, but only if it's in a fair and transparent fashion. There too much corruption surrounding the current investment.

The best form of investment is the human capital type of investment. The old saying that is better to teach people to fish rather fishing for them will forever remain relevant in terms of helping Africa. Therefore, any investment whether from the East or West as long as Africans remain spectator, end-users and spectators, it is not helpful for the continent.