China is building foundations in Africa for almost 50 years now. More than a decade after China began extending its economic and political relations with countries throughout the continent, the Biden administration is pushing hard for American corporations to invest in Africa despite their challenges.
China Is Clearly a Bigger Economic Player in Africa
China is Africa’s two-way commercial partner, with a projected $254 billion in commerce in 2021, outpacing US-Africa trade by a ratio of four. China is Africa’s greatest foreign direct investment source, generating hundreds of thousands of employees. This is approximately double the level of foreign direct investment in the United States. While Chinese credit to African countries has recently declined, China remains the continent’s top lender. With China’s spectacular development to become the world’s second-largest economy, it is to be expected that its economic involvement in Africa will increase, especially given China’s need for raw resources to maintain its extremely large manufacturing base. However, this expansion also reflects a persistent Chinese government-led push to make considerable inroads into Africa.
The USA Should play to its strength
American corporations are not competitive with Chinese and other firms in certain industries, such as road and bridge construction. Chinese companies have cheaper cost structures and have decades of the African experience. However, certain American companies are competitive, particularly in the health, financial technology, and renewable energy industries. The United States benefits greatly from its huge and thriving African diaspora, many of whom maintain trade ties to Africa. The event is engaging and profiling the diaspora smartly.
The United States also continues to inspire the vast majority of Africans who seek democratic governance. Washington should continue to back African democrats, civil society, and the media in their fight for transparent and inclusive governance, even when they suffer repression.
China kept its investments to a very visible and economical level. Making sure they build proper infrastructure for a solid economic partnership with Africa, leaving such democratic aspirations out of the equation.
China has rooted itself in Africa. The United States’ current policy to Africa appears to be more of a reaction to China’s ascent than a coherent structure. It is clear that the US initiatives were designed to undermine Chinese global development. Why launch such audacious efforts if you don’t even have a clear framework in place? So, the crucial question remains, can these efforts phase China’s robust African presence?
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