Why do Chinese companies invest so much in African countries?

In itself, the question seems simple, but the answer is rather complex.I am trying to sketch one and the other. As another answer has already indicated, there are geopolitical reasons for China to invest in African countries, in addition, there are also historical and even cultural.

The direct reason to invest in the African continent, is the Chinese Belt & Road Initiative, also known to us as the new silk route.It is true that, in October 2013, President Xi Jinping announced this initiative to establish new trade routes through gigantic investments and to strengthen existing ones to and from China. These routes should ensure that the whole world can trade with China and vice versa.

The size of this project is gigantic for the following reasons:

  1. There are 68 countries involved in the project
  2. In 2017, this was about 65% of the world’s population and 40% of global GDP
  3. Total investment is estimated at 6 to 8 trillion USD.

Let that amount settle

It is clear that China, through investment in Africa, can gather not only raw materials but also workforce, for its Silk Road.In the meantime, this is controversial because the idiot has led large investments to make a number of countries in Z-O Asia dependent on financing from China. (Which in itself is strange, because a whole number of countries are financially dependent on the US and there does not scratch a rooster). But well, I confine myself here to Africa.

What is the underlying cause of this initiative now?

Here it becomes really interesting.To understand what’s going on, we need to look at the history of China.

During roughly 5000 years, several civilizations, within what we know today as China and Mongolia, have developed, they have fought with each other, with neighbors, what is trade driven,… But NEVER has China, in all that time, had the tendency to conquer the world with its armies or trade caravans.

Through all her contacts with the outside world, China (for the most part) has been convinced that they had a superior society and that the world outside of them was actually not so relevant.In itself you can blame them, China is a huge country, so such a vast area with a lot of different cultures, comes with its own challenges and problems.

Yet they managed to set up a fairly advanced society long before the ‘ West ‘.On many points in the last 2000 years, they were even on the rest of the world. Chemistry, medicine, physics, art, engineering innovation, all this led to a mentality of introspection. It was acted with the outside world, but during a great piece of history, China considered the rest of the world to be ‘ barbaric ‘, in the absence of a better word.

Over the millennia, this idea has become rather firmly anchored, so the switch that makes China under Xi Jinping is not to be underestimated.For the first time in thousands of years China is looking over the proverbial wall. They have resources, a vision and they have a plan. Africa is part of it. After all, it is much harder for China to enter India as they can do it in Africa.

Also, don’t forget that African countries often have less to deal with China.They have been exploited by Western powers over the past centuries (until today that is still the case) and China is not only bringing them money but, above all, another possibility of shaping their own future. That China is not 100% clear in its objectives, them will often be sausage orphans.

For China the raw materials and ports give an advantage, but above all geopolitical gives them weight.Africa is still too often considered to be the weak brother of world trade, while they will know and create a lot of growth in the coming decades. China knows this.

Moreover, it gives both continents access to rapidly growing markets of young consumers.So it’s a win-win, though the balance weighs heavier for China. As a final point, I would like to say that India may seem like a better partner, but there are too many diplomatic and cultural issues between the two power blocks. In addition, India is much less easy to ‘ conquer ‘ in economic terms, as I mentioned earlier.

The next 100 years will be signed by China anyway, which the USA also says or does.The question is, what will the EU do?

Hopefully this outlines a bit of an image that can serve as an answer to this difficult question.

What do you need for a vibrant economy?People and infrastructure. If you can transport cheaply, and the laws work with it, the rest will follow.

Why did many UK companies invest in the permanent country at the time of the Industrial revolution?Because it was cheaper to build there, and because the market made it much more. If you are a moderate specialist at home, however, you are a pretty good specialist in a country that is empty of them. Africa is going to be a lot of jobs for Chinese who have nothing to look for at home but are going to pump money into the economy.

It is also so that politics there is easy to bend to your will.If the VOC brought samurai to beheaded Dutch citizens on the Dam, they would be dragged the same day before the wall, but when you do it in the Banta islands, nobody gives a nut. The Africans are accustomed to war, corruption and exploitation, that it is done by the Chinese fascinates anyone. If they try it in China, then they are facing internal problems.

Also it is of strategic importance that China now extends sea.The United States and the rest of NATO are scattered all over the world. For China, this is a threat, because, for example, if there is conflict between China and Japan or China and Australia, then the rest of the world is integrated into the American globalisation system and China must then be opposed to it. Countries are going to depend on their own interests, and so they would help us because they have so many American companies. China can now make African countries dependent, and it can now also establish military ports and facto rows, and thus, at the time of war, these strategic points would be of great importance, not only to fight defensively but also to be European-American Goals.

These are the reasons why China is expanding to Africa.

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