Friends and Interests: China's Distinctive Links with Africa

Many Chinese work in Africa under labor service contracts.33 They are paid much less and live more frugally than Western expats doing comparable work. In 1992 Africa employed one hundred thousand developed country expats at a cost of $4b per year, that is, $40,000 per individual or nearly $800 per week (Kollehlon 8c Eule 2003). Even now, Chinese wages are not nearly as high. Chinese employees (i.e., managers, engineers, and skilled craftsmen) of one construction firm in Angola receive $500 a month, live two to three to a room, and cook for themselves, while Europeans each rent a house and eat in restaurants. Chinese supervising African workers on construction sites dig along with them (Donnelly 2005; BBCRF 2006). China's largest contract in Africa, worth $650m, is the building of Sudan's Merowe Dam, which in 2003-5 employed eighteen hundred Chinese and sixteen hundred Sudanese. A PRC firm won the bid because it kept expected profit margins and Chinese staff costs low. All project managers, 90 percent of engineers, and 75 percent of technicians are Chinese; locals make up 20 percent of skilled workers and all of the general laborers. Expats earn $220-$600 per week, Sudanese $22-$350 {Xinhua 2006f; Reina 2004). Chinese firms in Africa "reportedly provide good quality projects at a price discount of 25-50 percent compared to other foreign investors," due not only to lower profit margins and access to cheap capital, but also to low wages and living standards for Chinese employees (Kaplinsky 2006:18-19).

While many Chinese now live in Africa, a growing number of Africans live in China. Guangzhou had ten thousand or more Africans in 2006, mainly China-Africa traders and students (BusinessDay 2006; Zatt 2007).34 Beijing in 2005-6 was said to have at least six hundred Africans, Shanghai five hundred, and Shenzhen one hundred (Simpson 2006). Most were students of medicine, engineering, or natural science, and expected to return to Africa in four or five years. That small brain gain contrasts with Africa's brain drain to the West, which originated with SAPs that required deep reductions of state expenditures. Before 1980, Africa had a dozen high-growth countries, averaging 6 percent. One-third of African states had savings rates higher than 25 percent, a level that sustained human resource development. But then SAPs curtailed state funding, including for universities, and costly expats had to replace local intellectuals. Savings rates plummeted to 10 percent, too low for industrialization or adequate education (Mamdani 2002). Now Africa yearly produces eighty-three engineers per one million people; China graduates seven hundred and fifty and developed countries one thousand (NMI 2006; New African 2006). Many African engineers emigrate to the West: more are in the United States than in Africa (ACBF 2004:15). From 1985 to 1990, sixty thousand African professionals emigrated. In 2000, 3.6 percent of Africans, but 31.4 percent of Africa's emigrants, had a tertiary education. By 2005, three hundred thousand to a half million professionals, including thirty thousand doctoral degree holders, had left and twenty thousand more emigrate each year to the U.S. or Europe. If the half million figure is correct, fully one-third of African professionals had left. On average, each represents a loss of $184,000 to Africa.36