Op-Ed: Chinese investors’ protection in Africa: a recipe for economic boom

The relationship strength developed over the years between China and Africa has sent a clear message that the West has stopped being Africa’s only option when it comes to aid and development.

China's "no-strings attached" development assistance and promises of growth has caused a good number of African countries becoming increasingly drawn to these realities.

Two female engine drivers gesture before the operations of the Standard Gauge Railway (SGR) in Mombasa, Kenya, on May 31, 2017. Kenya began operations on the Chinese-built Standard Gauge Railway (SGR) Wednesday. (Xinhua/Sun Ruibo)

Protecting investors is amongst key important elements of a flourishing market economy or financial investment institution. This is mainly because investors are important to the financial markets, and so therefore it is very important to protect their interests. 

Investors protection involves various measures established to protect them so as to safeguard them from malpractices, bad laws and other forms of insecurities, etc.

Investors protection requires investors to be fully informed about available market opportunities, conditions, challenges, their purchases, transactions, affairs of the company that they have invested in and the like.

These are most (if not all) of the opportunities good Chinese investors have been yearning for in Africa over the years after they have succeeded in pumping billions of US dollars to revitalize the battered African economy.

The so-called colonial masters in the West have not helped Africa that much, this has resulted in most African countries turning to China, not for recolonization as alleged, but to create a better partnership to increase trade and investments, enhance socio-cultural and economic advancement and for the overall aim of bettering the lives of people.

China’s Foreign Minister, Wang Yi, said in a 2015 tour of Kenya that "China absolutely will not take the old path of Western colonists, and we absolutely will not sacrifice Africa's ecological environment and long-term interests."

Chinese President Xi Jinping is always assuring that China aims to develop infrastructure, improve agriculture and reduce poverty on the continent.

The relationship strength developed over the years between China and Africa has sent a clear message that the West has stopped being Africa’s only option when it comes to aid and development.

China's "no-strings attached" development assistance and promises of growth has caused a good number of African countries becoming increasingly drawn to these realities.

Hence, the protection of Chinese investors in African countries will not only promote economic gains but also become a clear pointer to the fact that China will be more than willing to encourage more of its citizens to invest in the continent. If there are good policies and institutions in place, African countries can use Chinese investment well to grow their economies.

The reasons as to why the West is not much comfortable with the rapidly developing Sino-Africa relationship is a topic for another day, but by all indications their misconceptions have not in any way hinder the forward-looking relationship.

Many Africans now believe that China is a major partner than their colonial masters in mostly Europeans Countries, some of which would want the resources China is pouring in Africa’s development to be selfishly diverted to them.

There has been an increase in trade volume alone from US$10 billion to over US$100 billion between China and Africa over the last decade. With Chinese trade, people now have values for monies. Most Chinese Investors are willing to transfer skills to Africans, create employment, willing to pay and providing opportunities leading to economic prosperity.

Most Chinese companies operating in Africa believes in skills transfer mainly because they want to reduce the cost of hiring the services of expatriates who mostly require bumper pay, flight ticket, work permits, etc. Training locals and paying them salaries saves lots of resources that could be used to increase investment.

Africans see Chinese as hardworking people who have no time to rest, and they (Africans) want to follow this good path to better off their own societies.

The existing trust between Africa and China must not be allowed to be hampered by the so-called Western misconception of Chinese colonialism in Africa.

It therefore behooves African Countries to further strengthening the tie for greater opportunities ahead. Protecting Chinese Investors could be an important tool in this path.

China’s Deputy Director General of Department for African Affairs in the Ministry of Foreign Affairs has disclosed that African countries should put in place good reforms for the protection of Chinese investors and to open the way for more investment opportunities.

Addressing African journalists on Tuesday, Dai Bing said in a meeting with African journalists in Beijing that "one of the setbacks to the existing bilateral cooperation is the frequent change of mandates and leadership in African Countries. It sometimes hinders the bilateral cooperation. At times we have to scrap a whole agreement and delay investment plans when such issues occur. Some African countries lack favorable policies like good taxation and investment policies to protect foreign investors, which results in some companies finding it difficult to operate in the continent for a longer period."

Speaking on some major challenges affecting bilateral cooperation between African countries and China, Dai said although inter-country wars have reduced drastically, some countries have internal security problems whilst others have the problems of piracies and criminals that are giving headache to some investors, thereby affecting the bilateral cooperation.

"African countries have a long way to go, especially in building their infrastructure. The infrastructure in Africa is a problem, as some countries could not provide good electricity, roads, railway and water to attract investments," the Deputy Director General said, noting further that China is always looking for common developments that will enhance a win-win situation for the two economies.

China and Africa have succeeded in maintain good friendship, brotherly and good partnership in development. Although issues do emerge from time to time, but there has not been a major one for over 50 years which disturbs the relationship.

China does not pursue any unilateral interest when pursuing development in Africa, which is why the issue of having a comprehensive partnership came up at the 2015 Johannesburg Summit of Forum on China-Africa Cooperation, where a $60billion pledge was made by President Xi Jinping for ten cooperation projects that are geared towards building very good development systems in Africa, such as infrastructure, agriculture, education, health, etc.

China has trained thousands of talents from various fields in Africa, which helps capacitate local talents, and hopes to give experience and expertise to managerial experts.

China and Africa need to be pragmatic in seeking for key development results. There are lots of Chinese companies operating in Africa, with services provided at low rates. China and Africa should be close and deep-down in heart and should see each other at equitable feet.

What has emerged in recent years is that fact that China’s enterprises are major players in investment, which is why the country has shifted its cooperation from trade in commodity to industry capacity cooperation.

China is ready to open up more cooperation with African countries for the benefit of both people, and its investments in the continent need to be better protected.

Note: Abu Bakarr Kargbo is a Senior Staff Writer of Standard Times Newspaper in Sierra Leone and an intern at People’s Daily Online.