When Lenovo doled out $1.75 billion to purchase IBM’s PC unit in 2005, it did much more than become the third largest PC seller in the world. The deal effectively announced that China has arrived on the global scene, and that it is not only ready to be the largest recipient of foreign investment – it is also ready to invest elsewhere.
This month’s two week tour of Africa by a Chinese delegation headed by President Hu Jintao was another among an increasing number of signals that China’s global influence is growing strong. Cameroon, Liberia, Sudan, Zambia, Namibia, South Africa, Mozambique, and Seychelles aren’t global economic superpowers. So, although there is little talk about Lenovo-like deals, there are many discussions about the vast natural resources these countries have to offer – natural resources that China desperately needs to keep its booming economy going strong.
But China’s tour means something else. China’s commitment to contribute to resolving Africa’s development woes – by improving hospitals, providing medicines, building schools, writing off debt, and offering interest-free loans and development grants – presents a unique set of challenges.
Development assistance has been increasingly tied to good governance and anti-corruption commitments. The Millennium Challenge Corporation is one example. But if China is ready to offer an alternative – funds that come without good governance constraints – what does that mean for African countries?
Published Date: February 14, 2007