LESSONS FROM CHINA FOR AFRICA – SIPHESIHLE SKWEYIYA

Image: Macau Photo Agency (Unsplash)

The global political economy is premised on democracy, free trade and the self-regulating market and these principles are taken to be the prescription for political and economic growth. The global political and economic stage is also characterised by acute power asymmetries between the Global North and Global South countries and consequently, rising powers are attempting to challenge these existing power asymmetries. In this highly interdependent world, a country with rising power status has multi-faceted implications that transcend the material economic and military dimensions but tumbles over to the social and political dimensions such as, being a vanguard of norms and values in the international society. As is the case with the rise of China, being the second largest economy in the world, with its rather hybrid economic structure characterised by socialist and capitalist features, sometimes coined as a ‘socialist market economy with Chinese characteristics’ brings to the fore pertinent questions and lessons for Africa as to the path for economic growth and development.

The agenda for transformation of the International Political Economy (IPE) has also been exacerbated by the 2008/9 Global Recession which has sparked and compelled critical reflection about the nature and efficiency of neo-liberalism as we know it. Some scholars also argue that the Global Recession is an indication of the relative decline and transformation of Western (United-States led) hegemony. As China’s engagement with the African continent grows steadily year by year through bilateral trade and multilateral platforms such as the Forum for China-Africa Cooperation (FOCAC) and the collation of like-minded states across the Global South such as the Brazil-Russia-India-South Africa (BRICS) alliance. With the endemic challenges of underdevelopment and political instability faced by many African countries, these platforms open up opportunities for knowledge building and sharing among Global South countries overall.  

As the majority of African states face the pressure of integrating into the global economy and value chains in order to attract investment and bolster economic growth. The liberalisation and opening up of domestic markets to foreign trade and financial flows is a complex process that requires stable political and economic (and judicial) infrastructure in order to bulwark against market shocks. A large number of African regimes are mired with fragile political and economic institutions and this plays a major role in hindering growth and integration. Taking stock from China’s state-coordinated economy, despite its many controversies, such as, domestically, the limitations of press freedom which is a cornerstone of liberal democracy. Internationally, the discriminatory practices of Chinese multi-national corporations’ abroad .i.e. high-skilled labour is reserved for Chinese nationals whereas low-skilled labour is taken from the locals of that particular country. The main takeaway ought to be that a well-consolidated state machinery, cohesion and clear policy direction and commitment from the leadership are the prerequisites and fundamentals for a successful economy and the ability to control delinquent behaviour from foreign companies.  

In many African countries, the informal sector is the principal driver of the economy however, it is a sector that is grossly neglected by the state and remains undeveloped. For the sake of clarity, the informal sector can be defined as jobs (casual, temporary, non-paying) and businesses functioning in a wide array of industries such as entertainment, transport, agriculture, manufacturing, building, arts and crafts, and personal services. The informal sector is characterised by non-compliance with legal requirements, procedures and standards that are parallel to the formal sector such as, labour regulations, business registration, contribution to taxes, etc. Nevertheless, the informal sector happens to be the lifeline to the majority of citizens in African states and is thus, a major contributor to the economy because it provides employment and helps reduce poverty.

The hybrid nature of China’s economy can be described by how the country inculcated a duality of governance, with a top-down (state-lead economy) command structure whilst concurrently cultivating and incentivizing (bottom-up) entrepreneurship at the local level. They have done so by opening up barriers and subsidizing small enterprises, creating cooperation and integration between the local and national networks which helped unleash the country’s productive capacities and integration into global value chains. Development for African economies needs to be an endogenous and inclusive process involving fostering and investment in local, small businesses and the informal sector before branching out. The local/informal sectors of society are abundant with groups of people and individuals who are ambitious and driven, not only for the sake of survival, but also to thrive and prosper in their lives and in the economy. Herein lies wells brimming of untapped innovation and ideas which could be exactly what the continent needs to provide ‘African solutions to African problems’ but that will not happen automatically. It requires systematic and concerted efforts from governments to invest in their own people and incorporate indigenous knowledge systems within the political and economic institutional infrastructure. This will also build the self-reliance and sufficiency that the African continent strives so much for. 

The rise of China is perceived with a lot of skepticism by the rest of international community because of the country’s socialist leanings and lack of democratic spirit. That does not mean we have to throw the bath water out with the baby. The Chinese story provides an opportunity for Africa and the rest of the Global South to learn about the pros and cons of state intervention in the economy and gives a glimpse into the complex interplay between the State and the Economy in a society. The African continent overall is still grappling with the legacies of colonialism and the chronic poverty, dispossession and underdevelopment brought on consequentially. The most significant take home from the Chinese story is that transformation and development begins from within, no one is coming to save us. We are all we’ve got. 

Siphesihle Skweyiya is currently doing her Master of Arts (MA) in International Relations at UNISA. She aspires to be a researcher and practitioner within the Political Sciences discipline. Her research interests include African politics, International Political Economy, the Brazil-Russia-India-China-South Africa (BRICS) alliance,foreign policy and history.  

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