The New Scramble for Africa

The nations of East Asia have been seeking inroads into Africa over the past couple of decades in order to secure raw materials and business contracts. Their scramble for economic power on the continent has added a new wrinkle to the politics of Africa and its relations with the rest of the world.

What the nations appear to be interested in is what they can carry away. According to the annual report of the World Trade Organization released on July 23, fish, forestry, fuels and mining products were the primary targets. Fuels represent 75 percent of that trade, growing rapidly since 2000. In 2008, Africa shipped US$406 billon in commodities, primarily energy commodities, overseas. Intra-regional trade in Africa remains at extremely low levels – an average of 5 percent, an indication of the continent’s continuing inability to get its industrial act together.

Japan started with an advantage over its neighbors by getting there first. Africa in the decades following World War Two was dominated by anti-colonialism, post-liberation strife and Cold War rivalries. The fall of the Soviet Union in 1991 and the emergence of second generation African leaders (who stressed economic development over liberation ideology) made it possible for the Japanese to effectively pursue a new model of foreign policy on the continent. One result was the Tokyo International Conference on African Development (TICAD). Under TICAD, and in bilateral relations with African states, Japan stressed economic cooperation over humanitarian and military aid.

China has made up for its comparatively late entry, going at Africa with gusto. China's Forum on China-Africa Cooperation (FORUM), China's counterpart to TICAD, only started in 2000. However, Chinese trade and investment in Africa has grown rapidly.

Chinese loans can be more appealing to African leaders for several reasons. First, they tend to be at a lower interest rate than those from other sources. The Chinese also tend to be less worried about what local leaders in Africa will do with the money, raising concerns that low-interest Chinese capital that can easily be siphoned off for personal use, which makes them function more as bribes to African government officials and business people than as legitimate financial development aid.

Another downside to Chinese business deals is that, too often, the Chinese provide the labor as well as the capital: "Not too long ago, the governments of Cameroon and China made a deal in which China would build roads and infrastructure such as stadiums and sports fields," according to Marie Tamoifo Nkom, spokesperson for the African Youth Diaspora Forum (AYDF) in Cameroon, an organization aimed at engaging young African emigrants in their continent’s social, economic, and political development.

"Everyone was happy, first of all because Cameroon is in great need of sports facilities for the youth. Second of all, this project would mean job creation. Unfortunately, the latter did not happen as the Chinese brought their own laborers."

That is the disadvantage of accepting economic assistance from a country whose subjects are just as poor as your people are.

China's easy money, along with its support of repressive regimes like those in Sudan and Zimbabwe, has been beneficial in the short term but may cause long term problems.

The power plays that have come with China's rise on the continent have also set moves in motion to balance its current advantage. Japan and India have begun talks aimed at countering Chinese inroads on the continent. Japan and India's combined investment in Africa roughly equals that of China's.

Meanwhile, Korea's attempts to be a player in the scramble to secure rights to African resources have had as many misses as hits. Perhaps Korea's biggest blunder in Africa occurred in the island nation of Madagascar in 2008. The Korean conglomerate Daewoo secured a deal in which they would lease half of the island nation's arable land for 99 years.

The company would in turn hire local workers to grow food for the world market. The deal, smacking too much of neocolonialism, was a major contributing factor in the coup that ousted Madagascar President Marc Ravalomanana. One of the first actions of the coup's leader was to terminate the Daewoo deal.

Korea also made a major land deal with Sudan in 2008 that has yet to bear fruit.

Despite these missteps and the comparative small size of its investment potential, Korea can find a niche for itself in Africa by giving Africans a way of avoiding economic domination by the larger Asia nations (not to mention the US and the former colonial masters in Europe). That potential was realized in a recent agreement between Korean President Lee Myung-bak and

Gabonese President Ali Bongo Ondimba. Ondimba was blunt on the matter when he told reporters: "Gabon has drawn up a strategy to diversify not only its industry but also its partner country."

In any case, Asia's great scramble for Africa is on and it is not yet clear who will come out on top.

Andy Jackson blogs for Asian Correspondent, which with which Asia Sentinel has a content-sharing agreement, under the title Flying Yangban, which can be found at http://asiancorrespondent.com/flying-yangban.