Chinese investments in Africa beneficial to local communities

China’s economic engagement in Africa has been attracting widespread attention, generating debates across the continent, and beyond, more so regarding the implications for Africa.

Others view this engagement as an act of solidarity that offers African countries and their people the opportunity to create jobs, increase trade, and expand their manufacturing capabilities and thus generating benefits to local communities.

Skeptics, however, hold a different view, describing China as a rising power keen to exploit the African people and their resources for her own benefit.

What is incontestable, however, is the fact that Chinese investments in Africa have grown tremendously over the last few years. And if research findings recently released by SOAS University of London are anything to go by, then Chinese engagement in Africa has been of great economic benefit to the local communities.

According to the institution’s survey, Chinese construction companies are currently providing large numbers of employment opportunities in Africa. In a report titled “Chinese firms and African labor are building Africa’s infrastructure”, SOAS University of London particularly noted that Chinese companies involved in Africa’s infrastructure projects hire more African workers than Chinese expatriates.

“On the question of job creation and the proportion of national workers in the labor force, we find that workforce localization rates are substantially higher than usually assumed in media perceptions.” The researchers noted in the report.

The report further indicated that the researchers had found evidence that sampled Chinese firms contribute to training and skill development at least as much as other firms in the same sector, but it is in the manufacturing and infrastructure sectors where training is widespread and considered as much more necessary by firms.

The researchers gave an example of Ethiopia and Angola where these rates have grown significantly in the previous 10 years as Chinese firms settled in the two countries. Indeed, with a majority of contractors in their construction sector being Chinese, they have been the main contributors to job creation in absolute terms.

Add this to the McKinsey report, also released recently, which revealed that African employees made up 89 percent of the Chinese firms’ combined workforce. This finding was based on a survey of 1,000 Chinese firms and factories spread across the continent.

These reports vindicate China’s mission in Africa. It provides a succinct response especially to concerns regarding the East Asian country’s employment practices for large infrastructure projects its companies have been undertaking in the continent.

This is particularly logical seeing as to these companies, hiring Chinese expatriates has become an increasingly expensive affair due to the demands for higher wages and better living conditions.

“Given the rise in living and working standards in China, most Chinese companies find it increasingly unprofitable to bring Chinese workers to projects in Africa because expat workers expect more” the report stated

A case must also be made on these companies preferring to have their own people in management posts. It points to a lack of an adequate number of trained local employees with appropriate skill sets in Africa. The few who have advanced in their studies have had their place in the top seats of these companies.

This is not only about the Chinese companies; the report cites a similar scenario in European and American companies operating in Africa.

This shows that when all factors are taken into account, then irrespective of where the investments originate from, it is highly unlikely that this will impact workers’ pay.

It then means that African governments and other stakeholders should invest more in educating their people to gain skills necessary for the management and technical roles. Both reports also allude to this.

It is also worth mentioning that the majority of workers employed by Chinese companies (Particularly in the construction sector) have their accommodation and meals taken care of by the companies they work for. These workers manage to save more from their wages than workers employed in other firms, who leave away from work stations where living costs are high.

“In Angola and Ethiopia, even the lowest-paid low-skilled workers receive wages that are above the extreme and moderate international poverty lines. In Angola, all workers earn wages that are above the sector minimum wage and a majority of workers earn well above minimum wages.” The report, released in early April said

To address the issue of severe skill shortages in Kenya for instance, the Chinese firms’ contribution to skill upgrading, whether through formal or informal means, is beyond doubt. Most of these firms train on the job even as a good number of Kenyan students benefit from scholarships from the Chinese government to advance their studies. This is replicated in a majority of African countries.

There is no doubt that the nature of Chinese investments in the continent is one that provides tangible benefits to the local populations. Their engagement is contributing to the fight against poverty in the continent.

Over and above this, infrastructure projects are benefiting the common citizen by opening up the region, and in so doing increase access to transportation services. This has aided farmers, the majority of them practicing small scale, to get their products to markets in good time compared to the situation in the past.

Eric Biegon is a Multimedia Journalist with Kenya Broadcasting Corporation, KBC.


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