Africa: Take another look

Africa - Revisited

A few years ago, I came across what is now known as a strange map of Africa. Not so much about Africa itself but putting it in a kind of perspective in comparison with other countries in order to disabuse the view of Africa being out there, out of sight and homogenous.

The blog Africa Is A Country attempts to send up the impressions that tourists and workers to Africa, especially from NGOs give about Africa, but there comes a time where some basic enlightenment is useful.

In terms of size, Africa is the second largest continent in the world with 54* countries. [Source: WorldAtlas (Size)]

Continents

Continent	Size (km2)	Size (mi2)	Population	Countries
Asia	43,820,000	16,920,000	4,164,252,000	44
Africa	30,370,000	11,730,000	1,022,234,000	54
North America	24,490,000	9,460,000	542,056,000	23
South America	17,840,000	6,890,000	392,555,000	12
Antarctica	13,720,000	5,300,000	0	0
Europe	10,180,000	3,930,000	738,199,000	47
Australia/Oceania	9,008,500	3,478,200	29,127,000	14

*There are 54 fully recognised African states that are members of the United Nations with Algeria being the largest by size. [Source: Wikipedia]

However, this detail is hardly effective if one does not catch a visual side of the real comparisons which is where the map below comes in.

[Original Source: ThinkBig – 35 The Size of Africa now inaccessible.]
[Updated with a picture grab from WhiteAfrican on 23-11-2015]

Why it matters

The map is quite apt for many reasons because most of the people I have heard from that say they have visited Africa even though it might have one of three major destinations being Egypt, South Africa or Kenya have hardly seen Africa.

It was the Europeans that colonised most of Africa, Americans that do get to travel besides their economic or military influence are likely to be missionaries if they go off the beaten path or belong to some NGO helping fight one of Africa’s many ills.

The Chinese have been coming to Africa and it is estimated over 1,000,000 have set up home in Africa, the reception of the Chinese varies between great excitement and serious foreboding.

India, Incredible India just allows for those who have been there to know that it is just about a tenth of the size of Africa though with a similar population size.

In the end, I hope that this map just helps put Africa in perspective, it is not a country and even within the 54 countries there are nations, tribes, languages, traditions, cultures and much else that might be the topic for another write-up.

Just take in the wonder of the size of Africa for starters. Thank you.

Africa: Surveying the ruins of Made in China

Let’s say Sino-reticence

I wrote a bit about China in Africa in December and January that I almost turned into a Sinophobe, I even was invited to share my views on a proposed podcast that did not get published for whatever reasons that the other party did not care to share with me.

However, I have not taken my eyes off the topic per se, it only seems others have done a better job of covering the issues from apologists to anthropologists and everything you stick between them.

I must state that I welcome in general the presence of China in Africa but my concern is with the kinds of deals, contracts and arrangements we build with the Chinese that appear not to benefit Africans as much as it should appear to.

The level of investment by China in Africa is watering sums of money that they seem to have excess of and at pains to know what to do with the stash.

Made in China

A recent report in the Economist [1] however brings to light a concern that has been a problem in China and Asia with regards recent reports of tainted milk [2] for instance, then the 2007 melamine pet food recalls [3] in Europe and the United States, the Chinese toys tainted with lead paint [4] that peaked in 2007 but was still an issue into 2010 and now the African version of houses of cards covered later in this blog.

The “Made in China” tag or maybe even the "Made by the Chinese" tag has people questioning whether they are getting value for money or being ripped off; a lingering suspicion about sharp practices and a number of projects built by the Chinese that seem to have lost their presumed durability and purpose like putting up a woollen umbrella in torrential rain.

Yes, rain apparently swept away a 130km (81 miles) road from Lusaka to Chirundu in Zambia and hospital built in Luanda, Angola soon became unsafe to inhabit because of cracks that appeared in the walls within months of its opening.

Fantastic fireworks

It gets worrisome if the seemingly gold-plated and fanciful turn-key projects majorly run and manned by the Chinese are edifices of papier-mâché awaiting the right conditions to reveal shoddy, sub-standard and slap-dash practices that adhere to no rules or standards.

The fantastic pyrotechnics and fireworks only last for the duration of the burning up of the active ingredient and then we are left with just a memory of the spectacle – God knows, Africa needs more than firework displays.

Some of my previous blogs talk about poor human resources management and labour protections such that the difference between the influx of the West and the Chinese was one trying to raise the bar and the other looking for the basement or lower that they can get away with.

Armies of terracotta

The Chinese are beginning to leave indelible footprints around Africa with Africa and Africans taking the brunt of the abuse and lack of care, whilst governments in need of the easy money abdicate their responsibility to the governed leaving the oppositions in many countries an opportunistic galvanising message of showing how the leadership has been derelict in their core responsibilities.

In another area, the Chinese have cornered local markets with better production facilities and cheaper goods that have literally put local traders and manufacturers out of business. For the African customer, this appears to be good news but it leaves Africa at the opposite intent of that age-old proverb about giving a man a fish to feed him a day and teaching him to fish to feed him his whole life.

The Chinese are doing all the fishy business and no one is learning how to fish to be about to compete on any terms. Armies of terracotta cannot fight real battles.

We need to play our friends

Africa is far becoming the Eldorado for the Chinese and they are coming to fulfil their dreams whilst Africans must begin to ensure they share in some dream rather than face a recurring nightmare.

Rather than allow the Chinese to play Africans against each other, it is important for Africa to man-up on their deal-making and gain the backbone to say like the President of Angola once said to his Chinese counterpart, “You are not our only friend.”

Source

[1] The Chinese in Africa: Trying to pull together | The Economist

[2] Latest Tainted Milk Fatalities Rock China | East Asia and Pacific | English

[3] 2007 pet food recalls - Wikipedia, the free encyclopedia

[4] CHINA Chinese toys tainted by lead or made by child labour - Asia News

Africa: China in the minds of impressionable African kids

We are going to ABC school

My less than salutary views of China’s apparent invasion of Africa are continually reinforced with the bits of news that seem to show that China’s activities in Africa are not entirely for the long-term good of Africans.

I was irked this time by a tweet that came into my Twitter stream minutes ago.

It started with this tweet

@eolander If you don't think #China is moving to a soft-power strategy in #Africa: read this - they plan to build 1000 schools: http://bit.ly/g6x3Es [1]

To which I responded

@eolander Building primary schools is commendable http://bit.ly/g6x3Es but that is hardly the vehicle for knowledge transfer, is it?

I got this response

@eolander @forakin Africa's development needs extend beyond pure knowledge transfer. Building schools seems to be a wonderful price of entry to the African market.

There are so many strands of discourse with this development, the idea that the Chinese would build 10 ICT driven model primary schools in Kenya is quite commendable and must be applauded, and this intent would be scaled out to 1,000 such schools across Africa giving the lucky pupils a basic educational grounding in life.

One basic context

This however throws up a host of issues, one of which was exemplified in Oprah Winfrey’s Leadership Academy for Girls [2] (OWLAG) in South Africa, the benevolent lady shelled out $40 million of her own money to build that school and it drew a number of plaudits and condemnations.

In my view, I felt building one $40 million school where she had complete control of quality, management and oversight was something she could well do and it might serve as a model for schools that the government and other philanthropists might build in the future.

The other view was that she should have contributed the $40 million for 40 $1 million schools and that would have spread the opportunity but depreciated the quality because spread so thin we would have had to rely on the failing governments who are not making adequate provision for schooling in the first place to provide infrastructure, staff, support, inspection, monitoring and all.

It would have had all the makings of a logistical nightmare and prone to failure if standards could not be synchronised across the whole franchise compared to focus on a single school.

Extrapolating this view, for governments to welcome this idea at this level of the education ladder shows obvious and probably unforgivable failings of African governments to address the need for good primary school education.

Another Sino-African job imbalance

The standard of those schools might well be such that the staffing would not be by Africans but the opening for another influx of the Chinese of another profession – this time, teachers rather than engineers and entrepreneurs. To the million add another 50,000 Chinese ready to mould the minds of our dearly impressionable children.

In the meanwhile, we all think our children are getting a good education which they are, but whose minds would they have when they have finished?

Africans in the Chinese mould

The next stage to this is the building of model secondary schools that would take in the graduates of the primary schools, those who fail to make the grade would be a ready under-skilled workforce for the many Chinese industries that are growing around the continent.

Having been imbibed with the “Chinese Work Ethic”, they would be sophisticated sweatshop fodder for scandal-prone FoxConn-like [3] organisations, herded, kettled, run like the typical country folk of China that man the manufacturing lines of Chinese industry, living in atrocious bomb shelter conditions [4].

{Foxconn has seriously improved its human resources management in China but would Chinese companies have that kind of scrutiny in Africa? Where they do would we trade-off the opportunities they bring for the welfare of our people?}

Indeed, we need our African children at work, the good primary school graduates are 6 years away, then the secondary school intakes have another 6 years of reinforcement to make up the probably shift-leader and foreman class of the industry.

The risk of higher education

One would suppose universities would be the next stage but that is the dangerous part, that is where real knowledge and technology is transferred, that is where the spirit of independence is cultured, that is where ideas, solutions and entrepreneurs will emerge from and that would be the stiff competition to the Chinese Industry Complex [5] that is laying foundations as solid as pyramid bases all around Africa.

Again, on the surface it is all for the good, but the long term considerations of this seemingly “good intentions” use of soft power cannot of essence be for the noblest and altruistic reasons.

Africa already has many universities, they need funding, they need endowment, they need good management, I would rather we had Chinese money flow into those institutions, the Chinese brain-boxes join the faculties, Chinese professors of renown bring their wealth of knowledge just as they are bringing their money to give Africa the kick start it really needs.

Graduates of these universities would have more affinity for their localities; they will contribute to their communities, encourage development in their countries and be the kind of role models worthy of emulation that would really lift both our educational standards and the people in general out of poverty.

A fisherman without a boat or a lake

We are constantly told of the Chinese proverb – Give a man a fish, you feed him a day, teach a man to fish and you feed him his whole life.

That would be too simplistic a recipe for success, they have fed the man a day, even taught him how to fish, but there are no lakes to fish in and where there is water he has a rod but no boat – that is the context of this incipient soft power offensive that looks so commendable if it were not cynically sinister on closer scrutiny.

Sources

[1] Kenya Broadcasting Corporation - KBC News - China to build primary schools in Kenya

[2] Oprah Winfrey Leadership Academy for Girls [akin.blog-city.com]

[3] Scandal-hit Foxconn sets sights inland - People's Daily Online – Other related articles on the page point to serious human resources issues.

[4] Underground world hints at China's coming crisis - Telegraph

Addendum giving context to this blog.

[5] China's economic invasion of Africa | World news | The Guardian

Analysis of this news story requires another blog but a few interesting excerpts for starters.

"If you want to start something – and be the boss – Africa is the place to do it."

"Chinese work very hard, very quickly," he says. "But here we are training local people to do the work, and if someone does not understand, he works slowly. You have to watch." Read in the context of the engineer in charge who speaks halting English.

Other Sino-African blogs I have written

Nigeria: NaijaLeaks and why China is bad for Africa

South Africa: Why again China is bad for Africa

Comments: Why China is bad for Africa

Africa: How to make China good for Africa

Africa: How to make China good for Africa

Preamble

This is my third blog on why China is bad for Africa, it could be counted as the fourth but my last posting showcased comments that were posted with regards to the second blog I wrote.

Now, I would hate for any of these views to be misconstrued as a hatred of China and their activities in Africa, far from inciting Sino-phobia my intention is highlight areas in which Africa should improve their negotiating stances with China leading to lasting progress derived from the ready and attractive solutions the Chinese bring to Africa without caveats or requirements.

Ndubuisi Ekekwe wrote a blog for the Harvard Business Review starts with the headline Before Your Next African Investment [1] to which I contributed the following re-tweet.

RT @HarvardBiz Before Your Next African Investment http://s.hbr.org/gxykbE The Chinese have come for the mines and nothing for our minds.

Take it all in context

This blog must be read in the context of all the blogs listed below that I have written on this topic, or else it would be difficult to appreciate the issues raised in this blog.

Nigeria: NaijaLeaks and why China is bad for Africa

South Africa: Why again China is bad for Africa

Comments: Why China is bad for Africa

They speak English there

This time it is Sierra Leone where an English speaking country has taken on a Chinese makeover with its hotel sporting television remote controllers with Chinese labels.

In my last blog, referenced the issue that the Chinese create isolated enclaves for themselves meaning they fail to integrate with the host countries they have emigrated to.

The fact that television remote controllers are in Chinese begins to illustrate the glaring divide that is between the Sierra Leoneans or even Africans and the Chinese, very few of the locals would have any knowledge of Mandarin or Cantonese and it creates a barrier in communication and the generation of relationships which I highlighted in my first blog where Chinese managers who spoke no English could not be engaged when it came to industrial disputes.

Working Chinese and worked Africans

With a million Chinese in Africa, they are in no way helping create an African elite through the transfer of knowledge or skills, what the writer saw was young Chinese men getting ready for work, one can only wonder how many local people were getting ready to work in these Chinese operations who were of similar or higher cadre than their guests.

History seems to be repeating itself in Africa; though this is anecdotal, the Europeans of old that came to Africa cannot be said to have been the cream of the crop of their societies, though they did eventually make big names for themselves and probably a lot of money, gaining status and recognition back at home whilst sometimes doing commendable things for the Africans.

In the same vein, these Chinese young ones cannot have been sent out to Africa if they were the brains, the innovators, the thinkers and the geniuses, obviously, this assumption can be challenged but it is a valid premise to have.

These people who were hardly relevant at home come to Africa to become chiefs with “Indians” at their beck and call to be shot at like vermin as was the case in Zambia – one risks the accusation of wiping up a form of xenophobia but the facts are becoming evident on the ground.

Communication is key to knowledge transfer

The underlying problem is this, at best, the communication between many Chinese and Africans would be Pidgin English, poor French, or passable Portuguese depending on if you are in Anglophone, Francophone or Lusophone Africa; in the extreme it would be barking monosyllables with frantic gesticulations; hardly the means for technology or knowledge transfer – Africans will then be left none the wiser as the young ones build their profile to return to their home societies hopefully with the respect and authority they once did not have, having earned their stripes and medals from faraway Africa.

This is the crux of the problem, the Chinese are buying up access to resources, building infrastructure peopled and managed by themselves with Africans doing the graft work in miserable working conditions without adequate safety, human resource relations or developed management structures – there might be the token African face somewhere to offer the pretence of partnership but we should see through that.

When Africa runs out of the opportunities the Chinese are so ready to exploit, one does wonder what Africans would be left with as the Chinese leave to seek other lands to rape, albeit with consent and compensation.

Kill two birds with a Chinese funding

Indeed, we need infrastructure development and it is the failure of our African governments that has led to needing the Chinese to build our roads, our power installations, our railways, our stadiums, our critical infrastructure for economic progress and other aspects of real estate that seem cater to foreigners rather than the locals.

However, where our governments have failed us most is in healthcare and education, the headlines of disease and famine can become something of Africa’s past with good hospitals and good schools; this is where our governments should begin to direct their negotiating prowess with more finesse.

Take the money if you must but add conditions that would make for a lasting legacy for Africa and Africans, link the number of Chinese being brought in with numbers of Africans who need to have jobs, link infrastructure projects with community development for primary healthcare and good primary and secondary education along with scholarships to good Chinese universities.

Get tough with the immigrants

More so, use a percentage of the deals to endow impoverished local universities making them centres of excellence on African soil and finally require that no more than a certain percentage of Chinese immigrants are allowed to stay in African for more than a stipulated period without learning the official language of the country.

Short-term the visa requirement that at renewal a test of language proficiency is passed before their stay is extended.

It is not enough to receive Chinese funds, Africa should make good use of the influx of Chinese investment with radical changes to the lot of Africans in general – and then we can begin to see reasons beyond why China is bad for Africa to a longer term benefit for Africa.

Source

[1] Before Your Next African Investment - Ndubuisi Ekekwe - The Conversation - Harvard Business Review

Comments: Why China is bad for Africa

Comments and views

In response to the blog I wrote about why I think China is once again bad for Africa, I have received two lengthy comments that address matters of rate of investment and how African governance should be more protective of its interests and those of Africa in general.

I have decided those comments should not languish in the almost invisible sections of my blog and herewith publish them verbatim thanking the contributors for taking the discussion forward by making time to air their views on my blog.

The alarming rise in investment is unsettling

From JustRecently, I got this comment

Hi Akin,

I don't think that the West needs to return to Africa - it's never left. For some proportions, India's investment in Africa is about half as big as China's, and early last year, India planned to invest 1.5 trillion USD by 2019.

Then there's the African Growth and Opportunity Act, a trade program between the US and 34 sub-Saharan countries. Not to mention France and its trade and investment in north-western Africa, and beyond.

In 2008, of all Chinese foreign direct investment, 78 per cent went to other Asian countries, 10 per cent to Africa, and 7 per cent to Latin America, according to these statistics. That was quite a dramatic rise, given that the total amount of investment had more than doubled with 2007, when the share of that investment in Africa was only 6 per cent.

But I think what strikes China's competitors most is the dramatically rising trend of its investment, rather than the actual amounts.

Nevertheless, I'd certainly agree that China has a very negative influence on African governance.

That just worse in that good governance is essential to make - or rather keep - Africa attractive for investment from OECD countries.

Africans need to serve their own interests

From CodLiverOil, I got this.

Everyone is entitled to an opinion and no doubt this is yours.

But Africans have to grow up and make up their own minds.

Before the advent of China onto the continent when the West was attempting to guide/ influence how African countries should be run. The African elite were always quick to turn round and say they don't need to be patronised by the former colonialists.

China has now entered the scene, some African rulers want to use the fig-leaf of Chinese development will come to their shores provided that they remain in power until death forcibly removes them from the scene.

China is charting its own destiny; they have not aped the Western or Eastern models of governance but have formulated something of their own. So far so good, but that is something unique to China given its particular social and cultural history.

Africans have to wake up and grow up and realise they are neither the West or China or even Arabia, or anything in between. They have to formulate their own policy and chart that path to growth and stability.

The way African leadership and their associated elites are behaving it's no wonder why we are not taken seriously on the world stage in any quarter.

As for signing deals with foreign companies, it goes without saying that they should not sign deals that are detrimental to the national interest, merely because they personally benefit from it.

If we can't respect ourselves and our land, don't expect foreigners to. Do you think China will tolerate this behaviour by foreign nationals on their soil? I think not.

We should not be fooled that the West is entirely benevolent. We should remember history and act wisely. Our leaders should not be such cheap and worthless "sell outs".

South Africa: Why again China is bad for Africa

Preamble

Just over two weeks ago, I wrote a blog based on WikiLeaks cables [1] about Chinese influence in Nigeria which ended with the conclusion that in the broad scheme of things, China is probably bad for Africa.

Now, from a South African perspective, the influence of China again drives one to the same conclusions that despite the investment coming in from China, there is no discernable concern on the part of the Chinese for the general populace of Africa, they might well be trampled upon by their leaders just as a majority of Chinese are acquiescently trampled upon in China.

A brick for the BRIC

China’s charm offensive in Africa [2] continues apace like a juggernaut hurtling down a steep incline without brakes.

Having built a presence in 40 African countries in their quest for resources and by extension influence they have carted in about 1 million Chinese to our tropical climes and have thrown a brick through the window of economic norms by flattering South Africa with a leap-frog over the larger economies of Turkey, Indonesia and Mexico with the proposed membership of the Goldman Sachs BRIC construct of countries to form BRICS or CRIBS.

There are lots of ways in which China’s investments in Africa are lifting up the African profile in the global context of things and at the level there are probably benefits but the subtext to all this is how it affects Africans who are not part of the elite that the Chinese strike deals with.

Chinese not aiding African good governance

The first issue that jumps out of the news article is this – “Even the government of democratic South Africa is fascinated by the perspectives of growth and prosperity in China under an authoritarian regime.”

This is as ominous as it is dangerous, whilst growth and prosperity is probably the goal of every good African government, the means by which that is created, maintained and improved upon is still under flux.

Our democracies which are fledgling at best are still working on building strong independent institutions that honour the separation of powers, the rule of law, the security of enterprise and the accountability of leadership to all stakeholders within their countries and the relationships they have internationally, the Chinese model of government does not provide example to buttress these young democracies as it is authoritarian.

Accountability not authoritarianism

Many African countries have suffered under typically “China's centralised planned economy and forced domestic peace”, with military regimes and we have wholesale decided such authoritarianism does not augur well for both development and the protection of human rights which supposedly comes hand-in-hand with democracies of accountability.

If democracies are to roll back their frontiers to the Chinese way of doing things, the elite and leaders might have manifesto promises to make but never be bound to keep them; the entrenched incumbency that plagues those who on the taste power cannot face relinquishing their perch would not become a thing of the past.

Such countries as Zimbabwe, Angola, Mozambique and Congo which once had democratic antecedents that have turned authoritarian have been the more fertile grounds for the Chinese influx; the Chinese have come to some grief in those that have a thriving democratic discourse like Zambia or Nigeria.

Ruling party restraint

The concern is where the ruling party has such control over instruments of power that it can be persuaded to discard the constraints of democratic scrutiny for a more authoritarian slant; in countries like South Africa with the ANC and Nigeria with the PDP; their resistance can be weakened by access to attractive solutions and funds provided by China without political demands.

“China is after good business deals and is little interested in how African leaders treat their own people or minorities.”

Leaders who are ready to sell out their people for pecuniary advantage should not be in leadership and one good reference is found in the WikiLeaks revelations about China in Nigeria for oil resources where one respondent said if the military were in charge the Chinese and Russians would have gained more control of those resources than they have now.

Bent on isolating the leaders from leadership

We should not allow ourselves to be sweet-talked by the Chinese, with the platitude, “China's aide to Africa is oriented towards Africa's needs without political pre-conditions being set.”

There are still aspects of African governance that need mentoring, guidance and urging towards improving human rights and compliance to international law – China has consistently failed to apply pressure on Khartoum with regards to the genocide in Darfur in the face of glaring evidence that the situation there is untenable, the same can be said in their not reining the pariah state of North Korea.

This is not to say that they should assume an imperialist posture with international diplomacy but China within its own borders has festering discontent amongst minorities that has extended to Chinese of no significant power whose rights are abrogated by the egregious “eminent domain” type powers that displace people for development without adequate compensation or redress.

The West should not throw in the towel

This is why the West needs to return to compete in Africa for the sake of Africans in general whilst continually holding the leaders up to scrutiny, the additional expansionist drive of India and Russia in Africa along the lines of Chinese-led indifference does not augur well at all, one can only hope that Brazil would take the course of the West with better negotiated compromises of engagement and development.

Whilst the Chinese are involved in some image management drive, the fact is the Chinese are not integrating into Africa, like they do in the West by learning the local languages and adapting to the norms and values of their host environments rather they gather in isolated enclaves almost like Sino-Ghettoes.

They are no doubt bad for Africa

They are doubly unpopular for dumping their cheap goods in African markets destroying local industry; working conditions in Chinese operations are miserable; they are involved in smuggling, poaching and over-fishing in many places that for all the investment they have made in Africa, the signs are obvious that China is bad for Africa until we change the way we engage with them whilst striving for a freer and accountable value system in all areas of government, economic and social development.

The postscript to this news article is the one about the ANC Youth League sending representatives to North Korea and according Kim Jong Il the accolade of "great guardian" for peace. Obviously, any communist or socialist slant must not take root in Africa or the people would suffer a lot more than they are suffering now.

Sources

[1] Akin Akintayo: Nigeria: NaijaLeaks and why China is bad for Africa

[2] Mail & Guardian Online | Chinese wooing in Africa: Boom without democracy

Nigeria: NaijaLeaks and why China is bad for Africa

The cables are still coming

The need to continue to mine the WikiLeaks diplomatic cables must not wane even after the spotlights have moved on, there is much to be seen in those cables and this one must be highlighted.

NaijaLeaks, the Nigerian side of the things in this cable [1] presents a very interesting perspective to governance, leadership and accountability issues in Nigeria.

Playing one off the other

At the end of 2009, the Nigerian legislature was busy debating versions of the Petroleum Industry Bill (PIB) which many International Oil Companies (IOCs) thought was not structural or strategic but about asserting greater ownership of our national resources, in ways, this was a disincentive for new investment by IOCs but an opportunity for negotiation for the Government of Nigeria (GON).

Shell Nigeria had brashly suggested to the National Assembly that if the PIB were passed, the “Nigerian oil industry would be dead”, so the GON brought in the Chinese. Considering Shell has the best deal in the Nigerian oil industry they felt they could use that leverage to thwart a legislative process.

For those who advocate Chinese investment in Africa and sing the highest praises of China, this is one cable you should read and comprehend.

Introducing the Chinese in Africa

This is what they did, “The Chinese are very aggressive because they need the oil. They came in with big money, and they were ready with large loans with low interest rates.”

I have to give Nigerians credit for this, playing competing interests against each other whilst keeping control of the process, "We know what had happened in the Sudan and Chad and we know enough about them to know where we want them and where we don't." Then, the person goes on to say, "No one really desires to see the IOCs go when we have worked with them so long. Long-term friendships develop, a lot is learned from them, and we know how they do business.”

However, what was most revealing was because the Chinese oil companies are run, by which I think they mean owned by the Chinese government, their representatives in the oil industry do not know how to deal with democratic governments.

The Nigerian democratic experiment can be flawed but the core elements of it are working, efficient, functional and aggressive too in protecting Nigerian interests.

It is not for sale in Mandarin?

The Chinese because of their incentive of cash and softer loans had come to cherry-pick the oil fields and many of those fields were already allocated to other partners in the Nigerian oil industry. The cable says the Chinese acted dumbfounded and I think what was intended was dumb and of the fields already operated by other interests the Chinese said, “You mean we can’t have it?”

Therein lays the reason for the Petroleum Industry Bill, to create partnerships and binding contracts where interlopers cannot with their money make us rescind agreements in their favour and the punch line to this episode is, “We are lucky we have a democratic government, under the military, the Chinese and Russians would be here.”

If the Chinese had gotten their way, they would have successfully jettisoned the PIB and abridged our democratic process which is by no means perfect, this crucial bill showed that Nigeria had to keep its nerve and resist the incentives offered to pervert due process whilst protecting partnerships that have existed for decades.

Apparently, the Russians through Gazprom had tried similar tactics and the Nigerians did not like it at all, in fact, it appears Nigerians were more comfortable with the devil they know in the existing IOCs than the moneybag Russians and Chinese along with a willingness to maintain business agreements regardless of alternative business incentive.

Rotten command structure

Interestingly, the labour unions also did not want the Chinese in the Nigerian oil industry, with China featuring in the list of the five worst countries to work for; they do not have industrial relations representatives or formal human resources processes. The immediate supervisor exercises all power without being accountable to anyone and most of the Chinese officials are non-English speaking hindering constructive interaction, according to the cable.

Zambia is another African country that had suffered at the hands of the Chinese and if I recall, the writer of Dead Aid, Dambisa Moyo [2] is from Zambia and I do wonder what she has to say about the unions chasing the Chinese out of Zambia.

The issue of corruption is probably moot as well as it is global, but this is a very cautionary note, “The Chinese have no respect for local laws, and they compromise a lot of things, including safety.” According to the cable, “the Chinese were the first to bribe local officials to win contracts and get around local laws.”

This sets a very dangerous precedent in any setup that the Chinese seek to have influence, especially in Africa, if this kind of business practice is norm, we should not be blinded by the idea that the presence of money is the solution to development at the expense of other rather more established capitalist business practices which include the whole spectrum of management, accountability, industrial relations, human resources and more recently corporate social responsibility.

Know how to handle the Chinese

Therefore, it is, “The poor image of the Chinese helps to explain why they never seriously threatened renewal of the IOCs' oil mining licenses.”

Nigerians were playing the diplomacy game with relish and offered this statement from the minister in charge in which he said, “There was never any consideration of selling or trading one firm for (I think he meant against) another. NNPC has a right to relinquish any part of its equity to any third party that expresses interest and it is in that regard that the discussions with the Chinese have been carrying on.”

Nigerians have signed agreements with the Chinese and Shell get 45% of joint venture deals with the GON compared with other IOCs that get 40% and I would suppose the Chinese might be offered a lot less whilst doing well to keep a rein on their activities within Nigeria.

Sources

[1] Viewing cable 09ABUJA2170, Chinese oil companies not so welcome in Nigeria’s oil patch

[2] Dead Aid - Review

Newswatch Magazine - The Draft Petroleum Industry Bill 2009

What’s the Fuss about the Nigerian Petroleum Industry Bill?

The Nigerian Petroleum Industry Bill - Part 2

The Cable – With interesting highlighted bits

E.o. 12958: decl: 11/28/2019

Tags: econ, epet, enrg, einv, pgov, prel, ni, ch

Subject: Chinese oil companies not so welcome in Nigeria’s oil patch

Ref: Abuja 2100

Classified By: Ambassador Robin R. Sanders for Reasons in Sections 1.4 (b) and (d).

Summary

¶1. (C) Two xxxxxxxxxxxx officials recently volunteered that Chinese oil companies had made a lot of mistakes in Nigeria and neither official welcomed their presence. Nigeria National Petroleum Company (NNPC) xxxxxxxxxxxx said on xxxxxxxxxxxx the NNPC is aware of how the Chinese have behaved in the Sudan and Chad and that the Chinese do not know how to deal with a democratic government.

xxxxxxxxxxxx complained on November 11 that there is no recourse when dealing with the Chinese and that the Chinese do not respect local laws. The poor image of the Chinese helps to explain why they were never a serious threat to the renewal of the international oil companies' (IOCs) oil mining licenses (OMLs).

END SUMMARY.

Ruffled feathers...

¶2. (C) Nigeria National Petroleum Company (NNPC) xxxxxxxxxxxx discussed the Chinese oil companies' recent attempts to obtain deep water oil mining leases (OMLs) with Economic Counselor and Trade and Investment Specialist on November 13.

xxxxxxxxxxxx said that Shell Nigeria had opened the door for the Chinese by resisting GON efforts to pass the proposed Petroleum Industry Bill (PIB) and telling the National Assembly that the "Nigerian oil industry would be dead" if the PIB passed. "So they brought in the Chinese," xxxxxxxxxxxx said.

¶3. (C) Asked about how the Chinese handled themselves in Nigeria, xxxxxxxxxxxx said, "The Chinese are very aggressive because they need the oil." "They came in with big money," he said, "and they were ready with large loans with low interest rates."

But the Chinese also made some mistakes. First, xxxxxxxxxxxx said, "We know what had happened in the Sudan and Chad and we know enough about them to know where we want them and where we don't." At the same time, xxxxxxxxxxxx said, "No one really desires to see the IOCs go when we have worked with them so long. Long-term friendships develop, a lot is learned from them, and we know how they do business."

¶4. (C) Second, xxxxxxxxxxxx said, "Their oil companies are run by the Chinese government and they do not know how to deal with Qthe Chinese government and they do not know how to deal with a democratic government. For example, the Chinese told the NNPC officials which fields they wanted and the NNPC officials had to say, 'No, this field is operated by someone.'" The Chinese acted dumbfounded and said, "You mean we can't have it?"

"The PIB did not come from nowhere," xxxxxxxxxxxx explained. Much consultation occurred before the GON presented the PIB to the National Assembly and all that was not going to be undone because of a Chinese official. "The Chinese caused the problem," he summarized, "and they ruffled a lot of feathers." Xxxxxxxxxxxx added that Gazprom of Russia had used a similar approach. "We are lucky we have a democratic government" he said, "Under the military, the Chinese and Russians would be here."

...and no forwarding address

¶5. (C) xxxxxxxxxxxx colleagues also told visiting Coordinator for International Energy Affairs (S/CIEA) David Goldwyn and his delegation on November 11 that he and his union colleagues did not want the Chinese in the Nigerian oil sector. Goldwyn was asking about the problems faced by xxxxxxxxxxxx said, "The Chinese are here and that is a huge problem!"

"xxxxxxxxxxxx have a list of the worst five countries to work for," xxxxxxxxxxxx said, "and they are on that list." xxxxxxxxxxxx explained that xxxxxxxxxxxx had experienced a problem with ExxonMobil when they "wrongfully fired a worker." xxxxxxxxxxxx applied pressure through the U.S. steel workers and the worker in question was given a choice of being re-hired or compensated and xxxxxxxxxxxx chose the latter. "If xxxxxxxxxxxx a problem with a Chinese company," xxxxxxxxxxxx complained, "who can xxxxxxxxxxxx to?"

(COMMENT: Nigerian xxxxxxxxxxxx have complained to Labor Officer that the Chinese do not have industrial relations representatives or any formal human resources process other than the immediate supervisor who does the hiring and firing. Dealing with non-English-speaking Chinese officials also hinders constructive interaction.

END COMMENT).

¶6. (C) xxxxxxxxxxxx later elaborated by alleging that Chinese labor practices were not good so no one wants to be part of it. "Look at the Chinese mining companies in Zambia," xxxxxxxxxxxx said, "the labor unions there had to chase them out." xxxxxxxxxxxx noted that corrupt people in China were put to death, but overseas they quickly adapt to the local environment, including adopting corrupt practices.

"The Chinese have no respect for local laws," xxxxxxxxxxxx said, "and they compromise a lot of things, including safety."

¶7. (C) Petroleum and Natural Gas Senior Staff Association of Q7. (C) Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) xxxxxxxxxxxx said the Chinese were the first to bribe local officials to win contracts and get around local laws.

By contrast, xxxxxxxxxxxx said xxxxxxxxxxxx played by the rules and was above-board. "xxxxxxxxxxxx proud of xxxxxxxxxxxx company in that respect," xxxxxxxxxxxx said. (See reftel for additional background on Goldwyn's meeting with the xxxxxxxxxxxx).

Comment

¶8. (C) The poor image of the Chinese helps to explain why they never seriously threatened renewal of the IOCs' oil mining licenses (OMLs), the first of which the GON signed with ExxonMobil on November 20. Most of the remainder will be signed in the coming weeks.

Minister of State for Petroleum Resources Odein Ajumogobia told the joint GON-ExxonMobil press conference on the same day that, "There was never any consideration of selling or trading one firm for (against?) another." But he also said that, "NNPC has a right to relinquish any part of its equity to any third party that expresses interest and it is in that regard that the discussions with the Chinese have been carrying on."

The GON owns 60 percent of all the joint ventures with the IOCs (55 percent in the case of Shell). So, the NNPC and the IOCs could still end up having minority Chinese partners -- whether they like it or not.

¶9. (U) Embassy coordinated this telegram with ConGen Lagos.

Sanders