Africa News blog

Weapons of war

Has Clinton visit helped offset China’s clout in Africa?

U.S Secretary of State Hillary Clinton’s 10 day trip to Africa ends this week with many commentators viewing it at least partly as being aimed at offsetting China’s growing economic clout on the African continent. In public, Clinton has delivered Washington’s traditional messages on the importance of fair elections and of fighting corruption and human rights abuses.

But the fact that top oil producers Angola and Nigeria are both on the tour has made clear the importance of the visit from the perspective of ensuring access to resources – an area of huge importance to China too.

China’s trade in Africa hit $107 billion in 2008 and there are now 750,000 Chinese workers living and working in Africa. Sources in both Washington, D.C. and Africa confirmed that Clinton’s subtle diplomatic strategy is to offer African leaders infrastructure assistance in exchange for oil resources and increased energy investments on the African continent.

China, meanwhile, may be marshalling reserves to help kick start African economies and fuel demand as well as to secure access to its resources.

In the past, Beijing has always argued that it is still a very poor country on per capita basis so cannot afford foreign aid. China’s foreign aid was only 0.04 percent of its gross domestic product, only a fraction of the U.S. percentage of 0.4 percent and Europe’s 0.7 percent.

But the financial crisis has changed this. While the downturn has crimped U.S. and Europeans companies’ ability to expand overseas, Chinese firms, awash with cash, are keen to look for new growth opportunities in new markets.

Has Hillary’s visit helped to offset the Chinese push? What value can her words carry against Beijing’s ready cash? Should China be concerned that Washington  may be catching up with its own push into Africa?

Can U.S. trade help Africa?

Sudath Perera has every reason to be content. He started up his textiles factory outside the Kenyan capital Nairobi nine years ago; today, he employs 1500 workers and turns over between 18 and 20 million U.S. dollars a year.

“We are contributing to the local economy by creating employment,” he says. “And indirectly there are a lot of local suppliers also relying on us.”

Perera’s factory is one of thousands of businesses on the continent that are taking advantage of a U.S. trade programme under which certain goods from around 40 sub-Saharan African countries can be imported to the States duty-free.

It’s known as AGOA – the African Growth and Opportunity Act – and was one of the main reasons for U.S. Secretary of State Hillary Clinton’s visit to the continent.

“The ingredients are all here for an extraordinary explosion of growth, prosperity and progress,” said Clinton at the AGOA forum in Nairobi last week. “I know how important it is to translate legislation like AGOA into daily changes that people can look to.”

Many on the continent say they’re already feeling those changes. Textiles factory worker Christine Mwende didn’t have a job before Perera employed her; and though the 120 dollar-a-month salary she makes is low by Western standards, she says it’s made all the difference.

“This job has really helped me,” she told Reuters Africa Journal correspondent Vivianne Mukakizima. “When I started working here, my child had not started school – but he is now in class 4.”

China shunts U.S. into second place in Scramble for Africa

A presidential visit followed by U.S. Secretary of State Hillary Clinton’s African tour cannot conceal a stark reality: China has overtaken the United States as Africa’s top trading partner.

That is one of the main problems facing Clinton on a seven-nation jaunt meant variously to spread Washington’s good governance message and shore up relationships with its key oil suppliers on the continent.         

U.S. officials are keen to trumpet a 28 percent jump in 2008 in trade with sub-Saharan Africa to $104 billion, even if the increase is attributable mainly to the high price of oil, which accounts for more than 80 percent of U.S. imports from Africa.

However, there is another statistic that says more about the direction of development on the poorest continent: this decade’s tenfold increase in trade with China to $107 billion last year, narrowly eclipsing the United States.

The financial and then economic crisis that has pushed U.S. and European economies into recession and forced their companies to crimp overseas expansion is only likely to accelerate the trend despite the regional goodwill towards U.S. President Barack Obama, whose father was Kenyan.