China in Africa, Ka-Ching

by Cat Spencer

China’s ties with Africa date back to the 15th Century, so to speak of Sino-African relations as something new would be shortsighted. In fact, China’s involvement in the economies of numerous countries in Africa today is changing the face of the continent.

Through arrangements between the Chinese government and various African countries, China is becoming a new type of global power, increasing its ability to compete in a global economy, and sustaining its economic growth rates and access to natural resources.

China has looked to Africa as the stage upon which it may increase its economic prowess and expand its global presence. Why? China faces little competition with Western nations in Africa, and it is willing to participate in what other nations might deem risky business deals.

On October 2, 2006, the International Herald Tribune reported, “In the first half of 2006, China imported 522,000 barrels a day of crude oil from Angola.” China is currently importing 40% of its fossil fuel needs and is number two on the list of Angolan oil importers; the U.S. is ranked number one.

In exchange for the oil, China has supplied $2 billion USD worth of credit to Angola, and Chinese firms have implemented numerous infrastructural projects and services such as roads, bridges, public buildings, and homes.

Mike Green, an analyst at the Center for Strategic and International Studies in Washington, said of China’s controversial oil deals: “These are unstable countries, and if I was a shareholder in Chinese oil companies, I would be asking if it's worth the risk.”

Only, oil’s not the only game in town.

China is the second largest importer of wood in the world. Much of the timber China imports so cheaply is done so illegally, and some is imported in violation of international sanctions.

Given the U.N. sanction of Liberian timber, all wood imports from Liberia to China in 2004 were illegal. Though these sanctions were imposed in 2001, Chinese imports of Liberian timber increased by 35% between 2000 and 2003. Unfortunately, these sanctions, meant to cease all trade of Liberian timber, made this indispensable resource cheap, as sanctions severely lowered competition for Liberian timber.