Chinese drivers for African Development

Start date
January 1, 2008
End date
December 31, 2011
Project code
932-DIIS
Countries
Total grant
2,221,924
Contact person
Peter Kragelund
Description

Development aid alone cannot finance Africa's development. Other external sources are needed. Important among these is foreign direct investment (FDI), which may fill a resource gap in Africa and at the same time generate local development via transfer of skills, access to markets and employment augmentation. ‘New players’, most importantly Chinese companies, have entered Africa in the last decades. Investments in oil fields have received most attention so far, but while these investments may bring along much needed capital they seldom bring along economic benefits for the majority of the populations. FDI to sectors characterised by numerous linkages, by being labour-intensive, and by large export potentials potentially bring about more economic benefits for the population. Chinese investments in Africa are far more numerous in these sectors. This project sets out to analyse the effects of Chinese investments in three non-oil sectors in Zambia: mining for its importance in economic and political terms for China and Zambia, textiles for its considerable spin-off potentials for the Zambian economy, and construction for its close link between Chinese FDI and Chinese aid. In relation to this, it seeks to analyse how the presence of ‘new’ investors is used politically in Zambia. Thereby, the project contributes to an improved understanding of how African countries can maximise the developmental benefits of Chinese FDI. Zambia is perceived as strategically important to further our understanding of the upsurge in Sino-African relations as Chinese investments target several sectors of the Zambian economy, which makes a cross-sectoral study possible. Moreover, Zambia is a key destination for Chinese investments and China is about to become the most important investor in Zambia.