Is the strained SINO-European Relationship Africa’s Gain?

Olukayode Iwaloye - Lecturer and PhD Candidate in International Marketing, School of Management Leadership & Government, USJ

The intention of the European Union (EU) to play a larger role in international affairs is not in doubt; even the rejection of the Lisbon Treaty by Ireland cannot stop its integration program. On the other side of the world, China’s recent rise has created opportunities and threats to developed, developing and underdeveloped nations.   
China and the EU enjoyed an economic and political honeymoon in the 1990s. The Taiwan and Tibetan issues, the recent EU hard line on human rights issues in China, the continuing arms embargo against China, fallout of the Olympics torch relay, the extension of honorary citizenships to the Dalai Lama and Chinese political activist Hu Jia by the Paris City Council, honorary degree to Dalai Lama by London Metropolitan University and his invitation to Chancellery by the German chancellor strained the relationship between China and European nations.
The implications of the strain between the EU and China have benefits to African countries. The “legitimate right” of European nations to continue dictating the affairs of their former colonies is in danger. European nations are not pleased with China sabotaging their efforts to improve governance in many African nations. Many African nations are becoming more resistant to Western policy proposals; a good example is the rejection of the Economic Partnership Agreement proposed by the EU at the latest EU-Africa summit in 2007. The presence of the Chinese has provided a better alternative to African leaders.
While the Chinese relationship with Africa is blossoming, the relationship between EU and China is characterized by economic and trade disputes. These disputes include trade imbalances, pressure for appreciation of the Chinese currency, product safety, intellectual property rights and China’s market economy status. This friction in EU-Sino relations has led China to focus attention on African countries in order to solve some of its problems. China’s growth in the manufacturing sector demands constant provision of input materials to meet the demand. As major exporters of raw materials and importers of Chinese made finished products African nations provide China with the opportunity to solve a number of problems.
The presence of China in African nations has brought intense competition and jostling for its natural resources leading to increased prices. Invariably, it has helped increase welfare and standards of living in most African nations rich in natural resources. China’s gains will take some benefits away from the EU. It will lose its place as the biggest trading partner of most African nations.
European investment in Africa has come from privately-owned corporations’ focus on profit maximization but Chinese investment comes from firms that are state-owned with direct access to low-cost capital and a longer time-horizon. Although a unified market, the EU is still perceived as a difficult place to do business as it is complex and characterized by low economic growth. Chinese investors are more attracted to Africa, abundant in energy and resources, as these are the priorities of Chinese State-Owned firms. EU has markets, technology know-how and brands to offer which are not primary needs of the Chinese Central Government.
European countries will gradually review their perception of Africa. The black continent is not a burden to any country; it is a child of circumstance finding solutions to the mess created by colonial masters. The jostling for opportunities in the most backward regions by developed countries will account for Africa’s economic upturn, increase the political power of African leaders and upgrade African nations to the status of attractive economic partners.

©MDTimes/University of Saint Joseph