China Vision by Wagner Daniel

Author:Wagner, Daniel
Language: eng
Format: epub
Published: 2019-02-15T00:00:00+00:00

Why China is Betting on Africa

As China is in essence running circles around the rest of the cross-border investment world vis-à-vis diving into Africa and making long-term commitments to the continent, the US, major European nations, and much of the rest of the world are looking in awe at what Beijing is doing there. Long believed to be the world’s last ‘frontier’ investment destination, to China’s credit, it is not waiting to see what other of the world’s powers will do in Africa but is instead leading the way. While the Americans and Europeans agonize about human rights concerns and environmental considerations, Beijing has set its sights on its, and the continent’s, future.

In addition to Africa’s incredibly rich vein of natural resources, one of the most important considerations driving China forward there has to do with population growth. With few exceptions, sub-Saharan Africa is one of the few places in the world where citizens continue to have large families. Though family sizes will decrease as the continent becomes wealthier, Africa is still expected to continue to experience much more population growth than just about anywhere else.

By the end of this century a third of the world’s population, and a greater fraction of its young people, will be African. The future of Africa is therefore synonymous with the future of the human race. As the continent becomes more populous, those companies with an established presence there will be better positioned to sell into African markets, which will continue to grow.

Several other trends contribute to making investment in Africa a tempting prospect. Literacy rates and the percentage of citizens with access to the Internet have increased rapidly, which should unleash vast pools of previously hidden talent. In addition, democracy is proliferating, governance is improving, and local business environments are becoming more competitive, with each other and other parts of the world. Part of that is due to the cumulative transformative impact of Chinese investment there. The hundreds of millions of young, wealthier Africans of the future will all need places to live, energy to power their homes, and they will have rapidly increasing infrastructure requirements.[113] China is ensuring that it is extremely well positioned to provide all of it.

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