Africa china dialogue Launch - report.

AFRICA-CHINA
DIALOGUE PLATFORM
LAUNCH
REPORT
2 March 2016, Sheraton Hotel,
Addis Ababa, Ethiopia
Africa–China
Dialogue
Platform

AFRICA-CHINA
DIALOGUE PLATFORM
LAUNCH
REPORT
2 March 2016, Sheraton Hotel,
Addis Ababa, Ethiopia

4 5
REPORT Africa-China Dialogue Platform Launch REPORT Africa-China Dialogue Platform Launch
TABLE OF CONTENTS
Introduction..........................................................................................................................6
Thematic Areas.....................................................................................................................7
Session I: African-China Engagement for Development: the scope, trends,
opportunities and challenges..........................................................................................9
I. From TAZARA to HUAWEI: Myth & Reality of Technology Transfer in
China-Africa Relations: Li Anshan.............................................................................9
II. The Evolving China-Africa Relations: the Scope, Opportunities and
Challenges: Fantu Cheru..........................................................................................13
III. Chinese Investments in African Agriculture: Impacts, Opportunities
and Concerns: Fatou Mbaye....................................................................................18
Session II: Foreign Direct Investment and Sustainable Agriculture:
What role does Chinese OFDI play in Africa? Myths or realities of Chinese
Agricultural OFDI..............................................................................................................22
I. Chinese Agriculture Technology Demonstration Centres in Southern
Africa: The New Business of Development: Chris Alden.........................................22
II. Environmental Impact of Chinese Investments in Africa’s Agricultural
Sector: Tang Xiaoyang..............................................................................................27
III. Africa-China Collaboration on Agricultural Development: Foreign
Direct Investment (FDI) and Development Assistance: Gedion Jalata..................32
Session III: Making Africa-China Engagement work for Africa’s sustainable
development – The Regional Impact and Beyond.......................................................39
I. Making Africa-China Engagement work for Africa’s Sustainable
Development – The Comprehensive Africa Agriculture Development
Programme: Diana Oyena Akullo..............................................................................39
II. China-Africa Cooperation in Agricultural Development: Success,
Challenges and Sustainability: Shu Zhan...............................................................45
III.Africa-China Engagement on Infrastructure Development:
Opportunities and Challenges: Witness Simbanegavi...........................................48
Key Issues Raised and Policy Recommendations............................................................54
Common Positions and Policy Pointers.........................................................................54
Conclusion...........................................................................................................................58
Annex...................................................................................................................................60
Annex I: Programme........................................................................................................60
Annex II: Participants......................................................................................................64

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INTRODUCTION
On 2nd
March 2016 various stakeholders
convened at Sheraton Addis Hotel to launch
the Oxfam Africa-China Dialogue Platform,
with a day-long technical seminar and a
high-level diplomatic cocktail reception.
Over 100 representatives of governments,
the African Union, United Nations, embassies
international organisations, civil society
and media attended the event. The seminar
had an opening and three sessions and
interrogatedissuesaroundthescope,trends,
opportunities and challenges in the Africa-
China engagement for development; the role
ofChinainOverseasForeignDirectInvestment
(OFDI) and sustainable agriculture in Africa;
and making Africa-China engagement work
for Africa’s sustainable development and
assessing its regional impacts.
The opening session of the seminar set the
tone on the objectives of the launch and the
Dialogue Platform. In his welcoming remarks,
Mr. Desire Assogbavi, Oxfam’s Resident
Representative to the African Union informed
theparticipantsthattheAfrica-ChinaDialogue
Platform is a multi-stakeholders platform for
both China and Africa aiming to encourage
dialogueandinfluencepoliciesandpractices.
Mr. Assogbavi further indicated that the
fast growing Africa-China partnership is
actively promoted and encouraged by African
Governments but diversely appreciated and
understood by other stakeholders. “This
platform - a civil society initiative – will be a
multi-stakeholder forum by which we expect
to generate knowledge, inform and influence
policies and practices … and for the next two
years the platform will mainly be focusing
on sustainable development goals (SDGs),
climate change, agriculture development
and peace and security,” he said. He added
that the Programme is aimed at encouraging
and facilitating a constructive engagement
and dialogue of citizens, policy makers,
researchers and other stakeholders on the
growing partnership between Africa and
China.
In her opening statement, Ms. Chan Mayling,
International Programme Unit Director of
Oxfam Hong Kong, informed participants
about the work of Oxfam Hong Kong in Asia
and Africa over the past 30 years, with a
funding support largely generated from
donations of the Hong Kong general public.
She also highlighted how Oxfam Hong Kong
has widened its work focus to capture the
implications of the growing relationship
between Africa and China on sustainable
development and poverty alleviation in Africa.
The representative of the African Union
Commission Chairperson, Ambassador Jalal
Chelba, praised Oxfam for the launch of the
Dialogue Platform. Ambassador Chelba noted
that the AU values the engagement with
China and regards it as an important global
player. He underlined that the African Union
identifies itself as a people-oriented and
people-driven institution. In this regard, the
AU established institutions and departments
such as Economic, Social and Cultural
Council (ECOSOCC) and Citizens and Diaspora
Organizations (CIDO), meant to encourage
the involvement of citizens in the integration
process. The platform should hence assist in
propping an African Diaspora, an important
constituency of ECOSOCC, in the dialogue.
The opening session was graced by the
presence of Ambassador Kuang Weilin,
Head of Mission, China Permanent Mission
to the African Union, and Minister Dr. Arkebe
Oqubay, Special Advisor to the Prime Minister
of Ethiopia.
Amb.KuangWeilinexplainedatlengthhowthe
China-Africa relationship was being upgraded
to a higher level – as the relationship entered
a new stage of development. He recalled the
recently held Summit of the Forum on China-
Africa Cooperation (FOCAC) in Johannesburg,
South Africa, where African and Chinese
leaders agreed to a comprehensive strategic
and cooperative partnership based on five
pillars and ten major cooperation plans
from 2016 to 2018. The priority areas in this
regard include industrialisation, agricultural
modernisation, infrastructure, peace and
security. He urged the platform to focus
on some of these issues so as to offer
valuable ideas and recommendations to the
implementation process, which he said was
the daunting challenge of the cooperation.
“The platform can help identify and straighten
upfactsonthegroundand,takecareofwrong
perspectives,” Amb. Kuang emphasised.
In his keynote remarks, Dr. Arkebe Oqubay
highlighted the reasons why Africa-China
relationship is and should be important.
Apart from the continent being an important
geopolitical player, Africa has over 1 billion
people – a large consumer base for China.
Equally, the Chinese population provides a
huge market for African products. Chinese
OFDItoAfricahassignificantlyincreasedsince
2000. At least 50% of infrastructure in Africa
over the recent years has been made possible
by Chinese firms and financial support. China
is a major global player on issues of climate
change and in contributing to peace and
security. Africa needs China’s support in the
calls for the UN reform. Dr. Oqubay said the
platform is important in correcting negative
media reflection of Africa-China relationship.
According to him, the platform should
assist in highlighting issues that have to be
From left to right: Mr. Desire Assogbavi, Amb. Kuang Weilin, Ms. Chan Mayling Dr. Arkebe Oqubay

8 9
balanced in the relationship in order for it to
improve and work better for Africa.
Dr. Oqubay urged African governments to
ensure that they draw up development
plans to inform Chinese investment on the
continent. He also noted that often times
African host governments do not put in
place the required legislative framework
to accommodate the investment – nor do
they have clear plans and programmes that
enhance human resource development to
ensure skills can be transferred and retained
in Africa. He lamented the lack of civilian
interest or participation in negotiations of
contract. To him, this was partially the reason
why the terms of investment agreements do
not reflect citizens’ interests. Dr. Oqubay
underlined that the Chinese development
path is a very interesting ‘University’ that
Africans should study and emulate. “Learning
from China is absolutely important for Africa…
however, Africans should understand that
the Chinese context is different and should
never be mimicked,” he added.
Thematic Areas
Presentations were made focusing on three
broad thematic areas.
I. African-China Engagement for
Development: the scope, trends,
opportunities and challenges.
II. Foreign Direct Investment and
Sustainable Agriculture: What
role does Chinese OFDI play
in Africa? Myths or realities of
Chinese Agricultural OFDI.
III. Making Africa-China Engagement
work for Africa’s sustainable
development – The Regional
Impact and Beyond.
Session I: African-China
Engagement for Development:
the scope, trends, opportunities
and challenges
This session was intended to set the scene on
the scope of China’s engagement with Africa
more broadly on Foreign Direct Investment,
trade and development assistance. Both
historical and current trends were analysed.
Several issues were raised during the
presentations on this panel from Prof. Li
Anshan, Director of the Centre for African
Studies at Peking University; Prof. Fantu Cheru,
SeniorResearcherattheAfricanStudiesCentre
in Leiden; and Ms. Fatou Mbaye, Livelihood
Manager at the Agency for Cooperation and
Research in Development (ACORD).
I. From TAZARA to HUAWEI: Myth &
Reality of Technology Transfer in
China-Africa Relations:
Li Anshan
There exist three Basic Facts. First, there
is development in China-Africa relations;
secondly, China’s development and China-
Africa cooperation provide an alternative for
Africans. They can learn China’s experience of
development and carry out the cooperation or
not.Thirdly,whatChinahasdoneintheAfrican
continent is a promotion for investment since
the infrastructure that China has built in the
continent has provided good conditions not
only for Africans and Chinese companies
but also for the investment of European and
American companies.
Regarding various explanations or
misunderstanding of China-Africa relations,
one should ask a basic question: “what is the
general opinion of African people towards
China?” In a recent Pew survey, the African
response towards China is most positive. In
the Pew Global technology transfer attitudes
survey of “Opinion of China” for 2015, African
respondents showed a favourable view of
China. Among them, Ghana showed the most
favourable technology transfer attitude
(80%), followed by Ethiopia and Burkina Faso
(both 75%) and Tanzania (74%), then Senegal,
Nigeria and Kenya (70%), finally South Africa
(52%)1
. The poll indicates that Africans’
technology transfer attitude towards China is
generally positive.
Why Technology Transfer?
This is an important issue for African
development yet less studied. What is more,
in FOCAC Johannesburg Action Plan (2016-
2018), African and Chinese leaders put a great
emphasis on the issue of technology transfer:
“The two sides will place importance on
knowledge sharing and technology transfer,
and will carry out exchanges in technological
innovation policies and the building of
science and technology parks and encourage
research institutions and enterprises to have
intensive cooperation.” (4.5.2)
Definition
What is technology transfer? “Technology
transfer is an action that the technology-
holder passes the technology of production,
management and sale with its rights to
others through various ways.” (Huang Jingbo,
2005). In practice, besides technology
transfer, China also uses other expressions,
1 “Opinion of China”, technology transfer://www.pew global.
org/database/indicator/24/. Accessed on October 27, 2015.
From Right to Left: Prof. Li Anshan, Prof. Fantu Cheru,
Ms. Fatou Mbaye and Mr. Kevin May

10 11
such as “technology assistance”, “technical
cooperation” and “knowledge sharing”, to
express the same action.
Discourse
In the discourse on China-Africa relations,
there are two views regarding technology
transfer:
1. Trade with China does not appear
in general to result in technology
transfer and China has seldom or not
offered TECHNOLOGY TRANSFER to
African countries.
2. CapitalgoodsfromChinaareessential
TECHNOLOGY TRANSFER channels
that enhance economic growth in
Africa, and Chinese companies have
transferred technology in various
ways.
The case of Tanzania-Zambia Railway: a
modern legend
While Western countries and international
organisations thought it was an impossible
project and declined the request from
Tanzania and Zambia, China took up the task.
Together with Tanzania and Zambia, China
finished the monumental project within the
time after overcoming various difficulties
and at the sacrifice of 65 Chinese lives. This
is the best case of China-Africa cooperation,
exemplifying various types of technical
assistance and cooperation.
Tanzanian President Nyerere once praised
Chinese workers: “These Chinese workers
have helped in the establishment of the
factory, and are actively training Tanzanians
to take over from them.” George Yu, an
American scholar who pioneered the study of
China-African relations, said with admiration:
“To train African workers and technicians,
Chinese workers, technicians and engineers
had “a sense of a technical mission”.
Training methods included the following
three:
1. To run technical students training in
China;
2. To open training class in Tanzania and
Zambia; and
3. On-job training in two countries.
In June 1972, 200 students from Tanzania
and Zambia came to China, 179 of them
finally graduated in September 1975. They
were trained in transportation, locomotive
speciality, vehicle major, communication
major, signal speciality, railway engineering
speciality and financial professional. After
their return, they played a very important role
in their own countries.
The Chinese government also set up Training
Classes in Tanzania and Zambia. Various
classes were set up in Tanzania, such as
communication signal, line-bridge speciality
in Mang’ula in 1971, transportation in Mgulani
in February 1972, special training classes
started in Dar es Salaam and Mbeya. Moreover,
TAZARA Training School in Mpika in Zambia
started in December 1975. In 1978, classes
for internal combustion engine and railway
communication began. Altogether, China
trained 1257 special talents For TAZARA.
The third way is on-job training. This kind
of teaching provided more direct and
practical experiences to African workers
and technicians. Since this kind of intensive
training did not need any special facilities and
almost cost nothing, it is the most popular
practice in TAZARA. African workers learned
different skills such as drilling, assembly and
dismantle right on the spot and their work
efficiency was greatly increased. Philip Snow
once described that the Chinese workers
“preferred to teach without words”, simply
becausetherewasalanguagebarrierbetween
them and Africans. “A technician would
assemble and dismantle a piece of machinery
and encourage his African apprentices to
follow suit until they got the procedure right.”2
There were different types of training, such
as passing on the knowledge, helping and
showing the skill, conducting short lectures,
model demonstration, experience sharing,
etc.
In the following years, Chinese experts
still remained in TAZARA to train various
engineers, technicians and administrators
and maintained the operation. This
technology assistance and cooperation
continued until August 9, 1986. George
Yu described nineteen types of Chinese
technical assistance to Tanzania in
seven areas during 1964-1971, including
agriculture, culture and social, education and
training, health, industry, natural resources,
transport and communications, etc.3
There were other Chinese activities of
technical assistance in Africa, such as sugar
planting in Mali, tobacco planting in Somali,
all once claimed impossible by the Europeans.
4
China also promoted agricultural production
in Africa.
When Premier Zhou Enlai visited Ghana in
January 1964, he put forward the Eight
2 Philip Snow, Star Raft: China’s encounter with Africa,
London: Weidenfeld and Nicolson, 1988, p.163.
3 George T. Yu, China’s African Policy: A Study of Tanzania,
New York: Praeger Publishers, 1975, p.115. Philip Snow gave
a general survey of Chinese assistance to Africa in a chapter
entitled “The Poor Help the Poor” in his book The Star Raft,
pp.144-185. He sent me this book as a gift in Hong Kong
when I was invited by Prof. Kenneth King to give a speech in
Hong Kong University few years ago.
4 Philip Snow gave a general survey of Chinese assistance
to Africa in a chapter entitled “The Poor Help the Poor” in his
book The Star Raft, pp.144-185. He sent me his book as a gift
in Hong Kong when I was invited by Prof. Kenneth King to give
a speech in Hong Kong University few years ago.
Principles for Economic Aid and Technical
Assistance to other countries:
1. Aid not unilateral grant, but mutual
help;
2. Neither conditions nor privileges to
aid;
3. No-interest/low-interest and loan
can be prolonged;
4. Aid to help other countries develop
independently;
5. To produce quicker result with less
investment;
6. To provide the best equipment and
materials;
7. To guarantee the recipients to
master technology; and
8. Chinese experts should receive the
same treatment as local experts in
the country, enjoy no privileges.
The principles indicate that the purpose
of China’s assistance is helping recipient
countries to gradually achieve self-
reliance and independent development
(Principle 4); China should provide the best-
quality equipment and materials of its
own manufacture (Principle 6); in providing
technical assistance, China shall see the
personneloftherecipientcountryfullymaster
such techniques (Principle 7). Obviously,
this is a Technology Transfer process which
contains both provision of technology
with equipment and training for personnel,
qualified to master the technology. What’s
more, during this process, China would send
experts to African countries, yet Chinese
experts are not allowed to make any special
demands or enjoy any special amenities other
than local experts of the country (Principle
8).5
Technology transfer is not one-way traffic,
but double ways of knowledge sharing.
5 “Zhou Enlai Announced Eight Principles of Foreign Aid,”
China Daily, August 13, 2010.

12 13
For instance,
1. Chinese medical team in Africa with
medical skill transfer existed from
1963 till now.
2. China also provided technical
assistance to African countries’
agriculture.
3. In the Mid-1970s, when China was
planning to build a pipeline from
the western region to Shanghai,
Algeria assisted China in pipeline
technology;
4. In 1978-1982, Zaire helped Chinese
in learning metallogenic theory,
prospection of diamond and the
advanced experience of mining.
Why Technological Cooperation?
Technological cooperation is not only an
economic endeavour, but also a political
task. To unite and fight against the unequal
world system is the only way to liberate
mankind including the Chinese people; to
promote economy growth of the developing
countries is the best way to help each other
and consolidate the unity.
Technology Transfer after Opening Up (1980s-)
During his trip to Africa in 1982, Premier Zhao
Ziyang put forward the four principles of
China’s economic cooperation and foreign
assistance, i.e., Equality and mutual benefit;
Effectiveness; Various forms; Common
development.
Technology assistance was provided in
more diversified and flexible ways. Training
personnel is a popular way of Technology
Transfer because successful Technology
Transfer relies on human resources of both
host and home country. Technicians /
engineers need to be educated and trained.
During the 1990s, China ran 167 training
programs including 2667 p/t from developing
countries, many from African countries.
Some trainings were carried out by China
alone, some by cooperation with UNDP since
1981. FOCAC emphasises human resource
development as Brautigam described China’s
training program: “In my travels across Africa
between 2007 and 2009, I frequently ran into
people who volunteered to me that they had
been on training courses in China.” R. Toronka
told her experience of a training course in
China for African chambers of commerce,
found “the course was technology transfer
in-depth” and acknowledged the importance
of learning from China.
Case Study: Technology Transfer in Huawei
There is a rapid development in the
telecommunication sector in Africa ushering
in new patterns of Technology Transfer
between China and Africa. Huawei, a
telecommunication company, set up an
example. Huawei has adopted several
measures for Technology transfer in Africa,
which is closely linked to its global corporate
social responsibility program. There are
various programs on the African continent.
The most notable ones are:
1. “Seeds for the Future”;
2. “She Leads Africa (SLA)”Project;
3. “SchoolNet Project” etc.
“Seeds for the Future” is a program to help
young talents of telecommunication in
Africa. It was started in Kenya in 2011 and
now carried out in Egypt, Tunisia, Zimbabwe,
Nigeria, Uganda, Ghana, etc.
With long-term ICT capacity building
cooperation, Huawei will help Ethiopia in
its future capacity building in education.
President Museveni said, “Huawei is a leading
global ICT company, and we appreciate
Huawei’s contributions to improving ICT
development and bridging the digital divide in
Uganda. Looking forward, I hope that Huawei
will continue investing in cultivating more
local ICT talent, especially with the launch
of the “Seeds for the Future” program, to
contribute to the long-term development and
construction of the ICT industry in Uganda.”
Other Forms of Technology transfer include:
1. China National Petroleum Cooperation
(CNPC) signed several agreements
with Sudan Ministry of Energy and
Mining to train oil specialists and
donated money for the purpose
(Khartoum Refinery Company).
2. China International Trust and
Investment Corporation (CITIC) Group
built BN Vocational School (BNVS)
and cultivated technicians in various
fields for Angola.
3. Other projects with Technology
Transfer: Lagdo Hydropower Station
in Cameroon, Nouakchott technology
transfer’s Friendship Port in
Mauritania, railway improvement in
Botswana, the Gotera Interchange
and Light Rail in Addis Ababa, Ethiopia
etc.
II. The Evolving China-
Africa Relations: the Scope,
Opportunities and Challenges:
Fantu Cheru
ThecurrentresearchonChina-Africarelations
fall into two categories. The first is driven
by Paranoia i.e., the Chinese Are coming!
According to this perspective, the Chinese
gorging up Africa’s oil and other resources
that the West needs; Chinese under
cutting the interest of western business by
selling cheap in Africa; Chinese support for
undemocratic regimes (as if Western powers
DEVELOPMENT
ASSITANCE
INVESTMENT
TRADE
do not do that?). The second perspective
is driven by naiveté i.e., China as Africa’s
Saviour. According to this perspective China
is an alternative to imperialist or colonial
powers e.g., interest free loans with no
‘conditionalities’; tariff free access to a range
of African products; Chinese investment in
the neglected infrastructure sector.
What do we know? China-Africa relations are
complex; it involves both benefits and risks.
It is too premature to arrive at any conclusion
as to whether this relationship is necessarily
good or bad. Accesses to a reliable and
transparent DATA remain a problem. We need
more detailed research both on individual
countries; at the level of particular value
chains, in order to trace the real impact of
China on Africa’s development. The absence
of a clear African policy on how to engage
China is another problem. There needs to be
some strategic thinking on the part of the AU
on this to be linked to Agenda 2063. Equally
missing is a proper channel for civil society
engagement.
Figure 1: Key Vectors of Interactions between
Africa and Emerging partners: Trade,
Investment and Development Assistance

14 15
Fig. 5: Investment: Value of Chinese investment in Africa (as % of global share)
FIG. 6: Investment: Composition of Chinese investment by sector
FIG. 7: Investment: composition by sector and No. of projects
Fig. 2: The trade relationship between Africa and China has been increasing from time to time.
Fig 3: China’s Top Trading partners to Africa are as follows:
Fig. 4: Trade and investment

16 17
FIG. 9: Composition of China’s Aid, loans and Technical Assistance
RESOURCE BACKED
LOANS
Extendedtocountriesthatcannotprovideadequateloanguarantees.
(Angola, DRC, Gabon, Sudan)
CONCESSIONAL LOANS Carries an interest rate of 3.1%, a 4 years grace period, and maturity
of 13 yrs. Such loans require that at least 50% of procurement come
from China.
INTEREST FREE LOANS Mainly for infrastructure projects and usually written off as debt
relief.
BUYERS CREDIT (Exim
Bank loans)
Interest rate based on LIBOR. 50% domestic content required for
exported goods.
Key aspects of national strategies
Growth and structural change must be
achieved through “strategic integration”:
• Long-term vision and national
development strategy: Ethiopian
government Growth and
Transformation Plan I and II can be
cited as commendable instances.
• Pro-poor macroeconomic policy:
to improve supply capability and
international competitiveness. This is
achieved through targeted subsidies,
lower interest rates; protection of
infant industries; exchange rate
stability; gradual liberalization to
enable national enterprises to build
up production capabilities and thus
face external competition;
• Business and government strategic
alliance: defining the role and
responsibility between the private
sector, the developmental state and
civil society. Joint definition of critical
policies on technology, financial,
human resources and infrastructure
are pertinent.
A regional approach for engaging China
A regional approach necessitates greater
policy coordination between African
countries within a particular Regional
Economic Communities (REC), which may
include:
• Regional framework on industrial
policy: directing Chinese expansion
into areas of national/sub-regional
interest; technology and skills
transfers, etc.
• Regional platform for infrastructure
development: as a basis for
mobilizing infrastructure finance
from China into co-financing
arrangement with the Africa
Infrastructure Facility, the World
Bank.
• Common framework on resource
extraction and social and
environmental responsibilities
(e.g., EITI; Kimberley Process;
African Mining Vision; Land Policy).
Issues facing FDI in African Agriculture and
the new partners:
There are issues facing in African agriculture
and the new partner. These are financing
gap, technology gap, infrastructure gap,
experience-sharing and knowledge/
research gap. Most of the time, these issues
are interrelated as one issue affect another.
China’s rebalancing: challenges and
opportunities
China’s rebalancing has the potential to bring
benefits, but it also brings challenges. The
challenges include – the move from export-
oriented to consumption driven growth
model reduces the demand and price of
commodities. While the opportunities include
– rise in labour cost and appreciation of the
RMB will reduce China’s competitiveness.
This offers Africa countries an opportunity to
attract investment.
How should Africa tap into the ‘new
opportunities’?
Develop supportive but ‘strategic’ policies
such as:
Lowering of transport costs.
• Elimination of formal and informal
barriers that undermine the
investment environment.
• Increasing flexibility of labour
markets.
• Ensuring effective competition
policies.
Perspectives for mitigating the ill-effects of large-scale land investments
Human Rights approach: Investors perspectives: Local civil society
perspectives:
-Free, prior and full participation
of local communities;
-Protection of environment,
based on impact assessment of
sustainability of projects;
-Full transparency, with clear
enforceable obligations for
investors, backed by sanctions;
-Measure to protect human
rights, labour rights, land rights
-Distribution of ownership
of key assets (land,
-processing facilities,
etc.)
-Voice (who takes/
influence business
decisions)
-Risk (how supply,
production, market and
other risks are shared)
-Reward (how costs and
benefits are shared)
-Development by investors
of business models to share
value added with local
producers;
-Negotiation and
enforcement of deals that
maximize local benefits;
-Scrutiny of contract
negotiations by civil
society;
-Action by local farmers and
NGOs to protect local land
rights

18 19
III. Chinese Investments in
African Agriculture: Impacts,
Opportunities and Concerns:
Fatou Mbaye6
Background
Despite much rhetoric, Brazilian, Indian
and Chinese investments and aid in African
agriculture remain relatively less than
generally imagined, especially compared
to those of OECD countries and multilateral
actors such as the World Bank. The extent
of influence is often exaggerated in media
reports, especially when it comes to
allegations of land grabs. That said, these
countries have increased their influence in
African agriculture in recent years to become
important actors, and this influence is likely
to grow in the future.
Investments in African agriculture
It is noted that figures for agricultural
investments vary widely according to
different sources:
China
AccordingtotheChinesegovernment,China’s
total (not just agriculture) direct investment
in Africa increased from US$1.4 billion to the
US $3.2 billion during 2009-14 and its FDI
stocks rose from US$9.3 billion to US$32.4
billion. Figures for agricultural investments
vary widely according to different sources.
Chinese government figures from 2013 claim
that FDI in African agriculture stood at $173
6 This presentation is derived from a study on Chinese,
Brazilian and Indian investments in African Agriculture. The
study was conducted under ACORD’s Pan Africa Programme
supported by Oxfam Hong Kong and it offers new analysis of
Chinese, Brazilian and Indian investments in African agricul-
ture.
million in 2013, a figure which had risen from
$30 million in 2009. Another estimate is that
the value of (approved) Chinese investment
in farming in Africa was somewhere between
$172 million and $488.5 million in 2012.
In terms of the number of projects, Chinese
government figures from 2013 claim that
China had approved 212 agriculture-
related projects (grains, cash crops,
animal husbandry, fisheries, forestry, agro-
processingandcommoditytrade)in37African
countries by March 2013. Of these, 86 were
specifically related to farming (production of
grains, cash crops or animal husbandry) in
27 African countries. The six countries with
the most projects were Zambia, Zimbabwe,
Nigeria, Sudan, Mozambique and Tanzania.
Chinese agricultural investment in Africa
is occurring in a variety of crops, including
sisal in Tanzania, oil seeds and sugarcane in
Ethiopia, cotton and tobacco in Zimbabwe,
rice production and agro-processing of
cotton, rice and maize in Mozambique, and
rice in Cameroon. These investments are
often complemented and supported by aid
efforts of which two key related areas stand
out – agricultural technology demonstration
centres and training.
According to the government, China has
helped train over 5,000 Africans in agricultural
technology and management and has
provided practical agricultural guidance and
training through trilateral agreements with a
dozen African countries.
Brazil
With regards to Brazil, despite the avowed
interest of the government in agricultural
development in Africa, very few private
Brazilian firms have invested. Like China,
the most significant Brazilian investments
in Africa are in petroleum, mining and
construction. Brazilian agribusiness still
prefers to invest in lucrative markets in Brazil
and neighbouring South American countries.
However, agriculture still features more
strongly in Brazil’s development cooperation
in Africa.
Brazil´s National Development Bank (BNDES)
is the principal source of financing for African
governments and Brazilian companies
and has several mechanisms to finance
foreign investments, notably a credit line
for Brazilian firms. Financing focuses on
Angola and Mozambique and on large
companies in the infrastructure, minerals
and petroleum sectors. The main Brazilian
investment interest in agriculture has been in
sugarcane/ethanol, where the Africa office
of Embrapa, Brazil’s leading agricultural
research institute, has forged a large number
of bilateral biofuel cooperation agreements
with African countries. Aside from ethanol,
Brazil’s engagement in African agriculture
tends to be through specific bilateral or
trilateral projects (often involving Northern
donors) mostly run by Embrapa. Several
African countries, including Ethiopia, Ghana,
Benin, the Democratic Republic of Congo,
Guinea and Kenya have signed technical
cooperation agreements and have begun
implementing joint projects with Embrapa.
India
Indian investment in Africa focuses on energy
resource extraction, manufacturing, financial
services, and infrastructure development, in
addition to agriculture. Private companies
are the main vehicle for Indian investments
in African agriculture and Indian agribusiness
is notably involved in selling modern farm
technology, such as irrigation pumps,
tractors and harvesters and/or investing in
large-scale farms or plantations, notably in
Ethiopia.
Indian investments in African land have been
explicitly promoted by government policies,
especially lines of credit (LOCs) to foreign
countries from India’s Export-Import Bank
(Exim Bank), which are used by countries to
purchase Indian goods and services. LOCs,
which are soft loans, have been signed with
around 40 African countries, amounting to
around $1.2 billion for agriculture-related
projects during 2003-12. The largest line of
credit approved by Exim Bank outside the
Indian subcontinent was a $640 million loan
to Ethiopia for its Tindaho sugar project.
Increasingly, investments and cooperation
are also promoted through the Indo-Africa
Forum Summits held by India’s Ministry
of External Affairs and the Department of
Agricultural Research and Education under
the Ministry of Agriculture, which is providing
agricultural training to a small number of
African students and scientists.
1. Key implications
The report finds that there are some common
problems with Chinese, Brazilian and Indian
investments in African agriculture. It finds
that while some investments are bringing
opportunities, others are having adverse
consequences on local farmers and that the
kind of technology being promoted in Africa
tends to be more suited to Chinese, Brazilian
and Indian agribusiness interests than to
Africa’s smallholder farmers.
Above all, investments and cooperation
programmes do not appear to systematically
align with the interests of African
governments. Neither do they involve African
smallholder farmers in project design or
implementation.
2. Case studies
The full report contains three case studies of
Chinese investments in Africa, investigated
by fieldwork in Uganda, Zambia and Tanzania.

20 21
However, for this event, only two case studies
were presented.
Case Study 1: The Osukuru fertilizer project in
Uganda launched in 2014
In Uganda, research was conducted into
the Osukuru fertiliser project, whereby the
Guangzhou Dongsong Energy Group, a private
Chinese company with assets of over $1
billion,ispromotingaUS$620millionprojectto
build a fertiliser plant and conduct phosphate
mining in the east of the country. The project
is expected to employ around 1,000 people
and produce 300,000 tonnes of phosphate
fertiliser annually - enough to supply Uganda,
Kenya, Tanzania and Rwanda. The financial
benefits to Uganda of the project are unclear
since the Mineral Agreement signed between
the company and government has not been
made public. Different estimates have been
circulating: the Ugandan government was
reported to have claimed that the project
would ‘generate’ $350 million a year; however,
reports in China Daily state that, according
to the company, the project will generate an
annual net profit of $81 million.
People affected by the project are
overwhelmingly subsistence farmers who
have small holdings of around two acres.
The project’s Economic and Social Impact
Assessment states that ‘the major impact
[of the project] is the loss of crops and the
land itself. Being a fertile area, the persons
affected are likely to become more vulnerable
as they will lose their source of income’. The
project covers 26 square kilometres and
could displace up to 1,500 households; some
122 have already been relocated. The project
paid compensation according to government
standards, which benefited those who used
the money to invest in, for example, starting
other businesses or in livestock like cows
and goats. Yet the relocation process did
not involve providing training on developing
alternative livelihoods; thus most people
moved in ignorance, without ensuring
a reliable source of income to sustain
themselves in the future. This has meant that
most people have spent their compensation
moneyandnowhavenoalternativelivelihood.
Community members interviewed also said
they were in effect made to sign documents
to relocate in an intimidating atmosphere
amidst heavy police deployment. Since many
more people will be relocated, the project will
haveanevengreaterimpactonthelivelihoods
of the people of the area. The project may
create over 1,000 jobs, but most community
members are likely to be employed as casual
labourers only and mainly in the construction
phase.
Key Recommendations include that the
government and company should:
• Publish the Mineral Agreement for the
project, showing its fiscal and other
terms.
• Publish details on how much Uganda
can be expected to earn from the
project.
• Support those already relocated by
providing training on financial literacy
and business skills to enable them to
establish alternative livelihoods.
• Ensure that any future resettlement
promotes the free, prior and informed
consent of all those affected and
provides training to enable people to
establish alternative livelihoods.
The government of Uganda should also invest
more in ensuring that its extension service
is able to provide good advice to farmers on
the use of fertiliser. However, it should not
see increasing use of chemical fertiliser as a
priority for smallholder farmers; it should also
invest in agro-ecological farming.
Case study 2: The China Agricultural
Technology Demonstration Centre in Zambia
The Zambia Agricultural Technology
Demonstration Centre (ZATDC) project
was officially commissioned in May 2008.
Construction work was completed in January
2011. The Centre became operational in 2012
and is situated in Chongwe district near
Lusaka and staffed by Chinese nationals.
It is managed by the Jilin Agricultural
University (JAU) which collaborates with the
University of Zambia (UNZA) and the Ministry
of Agriculture through the Department of
Agriculture. The objective of the ZATDC is
to improve the capacity and expertise of
Ministry of Agriculture staff, university/
college students and small-scale farmers in
order to increase crop productivity through
trainings and demonstrations. The Centre has
so far conducted around 38 training sessions
and has trained 718 people. The main
training focus of the Centre is in mushroom
production.
The research found that the training offered
by the Centre was valuable. However, the
research found no evidence that small-scale
farmers are consulted on what trainings
they would like to attend; instead, they are
just told by their camp extension officers to
prepare to attend trainings that have already
been arranged. Trainings are attended by
interested individual farmers, and selection
is not based on whether farmers are members
of a particular cooperative or represent large
numbers of farmers. Thus it is not at all clear
how or whether farmers being trained will
pass on their knowledge to other farmers.
Small-scale farmers could be represented
at the Centre by a cooperative federation
which is likely to be best suited to negotiate
and speak on behalf of farmers. There is
currently no such cooperative on the board of
the Centre. Of the 718 people trained so far,
only 42 are women. This is a low proportion
indicating that the Centre has no particular
focusonwomenfarmers.Yetwomencomprise
around 65 percent of smallholder farmers in
Zambia and are the main producers of food.
The research concluded that the Centre and
Ministry of Agriculture should:
• Increase the Centre’s publicity work
so that farmers and the agricultural
staff at district level are aware of the
training programmes on offer.
• Conduct follow-up after trainings
to evaluate the impact and assess
progress among the beneficiaries.
• Involve small-scale farmers and
their representatives in the design
and implementation of training
programmes and ensure that these
are focused on the identified priority
needs of small-scale farmers.
• Provide transparency on the Centre’s
budget.
• Base the Centre’s activities firmly
on the priorities outlined in Zambia’s
National Agricultural Investment Plan
under the CAADP framework.

22 23
SessionII:ForeignDirectInvestment
and Sustainable Agriculture:
What role does Chinese OFDI play
in Africa? Myths or realities of
Chinese Agricultural OFDI
This session had three Panellists: Prof. Chris
Alden, Research Associate at the South
AfricanInstituteofInternationalAffairs(SAIIA);
Prof. Tang Xiaoyang, Associate Professor at
Tsinghua University; and Mr. Gedion Jalata,
Programme Manager of Oxfam International’s
Africa-China Dialogue Platform.
I. Chinese Agriculture
Technology Demonstration
Centres in Southern Africa: The
New Business of Development:
Chris Alden7
Chinese agricultural aid in Africa dated back to
the late 1950s and still remains an essential
part of Chinese contemporary aid towards
the continent. Due to the significance of
agriculture to economic development and
socialgrowth,thesectorhasalwaysbeengiven
special priority by the Chinese government
in its aid pledges. The aims and modalities of
Chinese agricultural aid in Africa have however
undergone substantial changes over the last
five to six decades. This is particularly the
case with the country’s aid reforms since the
7 Chris Alden acknowledge that the paper was originally
co-authored by him and Lu Jiang, Angela Harding, and Ward
Anseeuw
1980s, which began to put more emphasis on
aid performance and on serving a wider range
of foreign policy objectives.
The Agriculture Technology Demonstration
Centre (‘the ATDC’ or ‘the Centre’ hereinafter),
a flagship project of Chinese contemporary
agricultural aid programme in Africa, is a key
institutional expression of this transformation
of Chinese foreign aid. It combines both
diplomatic and commercial goals, involves
a diversity of public and private actors, and
adopts a complicated operational mechanism.
Furthermore, it represents an innovative
dimension of Chinese agricultural aid, in
that it is a hybrid of different forms of aid
programming previously utilised (e.g. farms,
agro-technology demonstration/extension
stations, experts dispatch), with some of the
mechanisms being intentionally designed to
avoid problems experienced in the past.
The ATDC project was first proposed at the
Beijing Summit of the 3rd
FOCAC in 2006. The
Chinese government pledged to build 10
ATDCs in different African countries. The
number was then increased to 20 during the
4th
FOCAC in 2009. By 2012, there had been
in practice at least 23 Chinese ATDCs across
Africa, with 14 of them having already been
transferred to the host governments.
Objectives
According to the official document issued
by the Chinese Ministry of Commerce and
Ministry of Agriculture, the objectives of
the ATDCs could be seen as three-fold: first
and foremost, the ATDCs were launched for
diplomatic reasons. The aim is to improve
the food security of the recipient countries
through the transfer of Chinese advanced
agro-technology, and thereby, to consolidate
and strengthen the relations between China
and Africa. Specifically, the agro-technology
transfer is to be realised through the
execution of the four functions of the ATDC:
research, demonstration and extension,
training, and exhibition. These are also
termed by the Chinese government as ‘public-
interest functions’ (gongyixing gongneng) for
they are all supposed to be non-commercial
activities.
Second,theATDCsalsobearsomecommercial
elements. Most prominently, the commercial
elements are manifested through the
intention of establishing business platforms
for Chinese agro-companies, which is termed
as a business introduction in our research.
Also, similar to the practice of Chinese
contemporary aid in general, the ATDC project
is accompanied by and expected to promote
the export of Chinese agro-equipment and
materials, among others.
The last dimension of the ATDC objectives
concerns with the sustainable development
of the aid project. The sustainability issue
derives from China’s decades-long practice
of agricultural aid on the continent. As has
been widely observed by practitioners and
scholars, almost all the Chinese agro-aid
projects in the past cannot escape the cycle
that: no matter how successful the initial
period of the project proved to be, once the
Chinese experts left, the project would soon
fall into disrepair. Quite often, the reason
for this was believed to be the inadequate
capability of the aid-recipient countries,
particularly in financial, managerial and
technical terms, to keep the projects going
without external assistance. Against this
background, the sustainability issue was
brought to the fore in the designing process
of the ATDCs. The emphasis on sustainability
can be seen from the performance evaluation
system of the ATDCs, in which the planning
and realisation of sustainable development
occupy 45% of the total scores, more than
any other indicators.
Actors
As to the actors involved in the
implementation of the ATDC project, on the
Chinese side, the government incorporates
Chinese companies, both state-owned
and private, in the management of the
ATDCs. This demonstrates an element of
government-company cooperation, and,
in the case of private firms, a Public Private
Partnership model. The Ministry of Commerce
and Ministry of Agriculture at the central
level are predominantly involved in the
planning, facilitating and supervising the
ATDC project. In most cases, each of the
ATDC-recipient countries is twinned with
one specific province in China, thereby
the corresponding provincial governments
also play an important role, and notably in
encouraging and supporting agro-firms from
their own provinces to invest in the twinned
African countries. On the recipient side,
various counterpart government agencies are
involved in the implementation of the ATDC,
which vary in the different African countries.
No private actors from the host countries are
currently involved in the implementation of
the ATDCs.
Mechanisms
Each ATDC has three operational stages:
Project Construction Stage, Technical
Cooperation Stage and Business Operation
Stage. The Project Construction Stage
normally takes one to two years with full
funding from the Chinese government. Then
follows a three-year Technical Cooperation
Stage when the ‘public-interest functions’
of the ATDCs are to be implemented and
funded primarily by the Chinese government
as well. Particularly notable here is the
final Business Operation Stage. While also
in line with the ‘business introduction’
objective, the primary purpose of having this
prolonged cooperation period is to ensure
From Right to Left: Prof. Chris Alden, Prof. Tang Xiaoyang,
Mr. Gedion Jalata and Ms. Nellie Nyang’wa

24 25
the sustainable development of the ATDC. To
counteract the unsustainability problem as
experienced in its previous agro-aid projects
in Africa, the Chinese government devised
the plan to incorporate company actors
and to run the ATDCs as a business in the
medium-long term. Financially, by developing
a market-oriented production based on the
ATDCs, it is expected that the profits earned
could be used to finance the daily operations,
including the realisation of the public-
interest functions. In addition, the existence
of the Chinese company and its agro-experts
would help maintain the managerial and
technical sustainability.
Findings
Based on our field research, the following
findings are particularly noteworthy.
First, the Chinese agro-technology transfer
through the ATDCs proves to be beneficial to
the local communities in the host countries.
The training courses were carefully designed
by the Chinese agro-experts according to
the specific needs and actual abilities of the
different types of trainees – for instance,
the smallholder farmers, technicians, and
officials. The participation of the local
partners helped overcome the oft-seen
language barriers, and thus further improve
the effects of the technology transfer.
From the feedback perspective, the farmer
trainees, for instance, confirmed that the
Chinese agro-techniques were useful and
could help increase the outputs, sometimes
more than doubled, as seen in both the cases
of Mozambique and South Africa.
Nevertheless, the impacts of the technology
transferarealsotosomeextentlimited,mainly
for three reasons. The first problem concerns
the training model. In both cases, the majority
of the trainees are the smallholder farmers. It
is so because the Chinese experts believed
that, by transferring farming techniques to
the actual agricultural producers, it would
have the most direct results; and indeed, this
is true and sensible. However, we find that
the potential benefits would have been much
increased, both in quality and quantity terms,
if the demonstration and training activities of
the ATDCs had been connected to the host
country’s agro-technology extension system
in a more effective way. The fact that the ATDC
in South Africa trained and incorporated a few
local agro-extension officers who turned out
to have played a quite positive role in helping
disseminate the Chinese agro-technologies
confirmed our point; the ATDC in Mozambique,
however, had not seemed to be linked to the
country’s extension system in any meaningful
way by the time of our fieldwork.
Another problem concerns the post-training
application. Even if the technology transfer
process per se is successful, it may not
necessarily change the livelihood of the
farmers, unless they have the enabling
environment whereby they can put the
techniquesintoanapplication.InSouthAfrica,
for instance, the heating systems of the fish
farms, which were fundamental to apply the
techniques the farmers learned at the ATDC,
were left broken for months, causing stunted
growth of the fish and reduced profits. In
Mozambique, although we did not manage
to interview the farmers trainees of the ATDC
(as they were scattered all over the country),
we went to visit a Chinese agro-investment
project which involved systematic technical
training to the local farmers. As revealed
by this case, the techniques taught by the
Chinese experts could not be implemented
outside the Chinese farm in their own
fields, due to a lack of tools and irrigation
equipment, thus the training courses had
little sustainable effects on the farmers’
livelihood.
A potential challenge also lies in the different
farming cultures. It takes time for the African
smallholder farmers to learn and get used
to the Chinese/Asian way of intensive
cultivation. It is also often difficult for the
African farmers to stick to it, which is more
technically demanding and time-consuming
compared to the extensive way of farming
that they are more familiar with. This casts
some doubts on the sustainability of the
technology transfer.
In terms of business introduction, as seen in
the cases of Mozambique and South Africa,
apart from performing the core function of
agro-technology transfer, both centres had
started or planned to start market-oriented
production activities. More essentially, both
of the two Chinese companies involved had
either set up separate agribusinesses or
had been actively seeking external agro-
investment opportunities by using the ATDC
project as a springboard. Indeed, available
datasuggeststhatatleast8outofthefirst14
ATDCs in Africa have successfully established
their independent agribusiness outside the
ATDCs. Furthermore, the Mozambican case
has demonstrated a greater role of the ATDC
as a business platform through providing
information and technical support to other
Chinese companies and individuals, thus
facilitating their investment in Mozambique.
The project sustainability, however, seems to
remain as a concern within the renewed aid
structure. As shown in the Mozambican case,
although the ATDC did make some business
attempts, the centre was still not able to
achieve financial independence simply by
selling the agro-products. This was primarily
due to the limited land, capital and human
resources it possessed and thus a rather
small production scale; indeed, most of the
ATDCs are facing the similar constraints.
Therefore, it does not seem very likely that
the ATDCs will be able to sustain themselves
financially through a business operation.
To pursue that, an expansion of investment
and production scale is necessary, either
based on the Centre or a separate business
outside the Centre. This, however, may face
challenges on two fronts.
First,howlikelyisthebolt-oninvestmenttobe
successful? The question then is translated
into another issue about the feasibility and
profitability of conducting agribusiness in
Africa. According to existing and potential
Chinese agro-investors in Mozambique, the
difficulties in operating in Africa were far
beyond their expectations before they came
to the continent, and none of the existing
investors had managed to make any profits
to date after years of operation. This may
cast some doubts on the prospect of the
ATDCs’ commercial development in the host
countries. Second, even if the company could
make good profits, to what extent would
the company support the public-interest
functions of the Centre financially? Given the
fact that there had not been any concrete
agreement between the Chinese government
and companies that clearly specifies each
other’s rights and obligations, it is rather
unrealistic to expect the company actors to
willingly and automatically fulfil the general
public-interest functions of the ATDCs,
especially given the generally low- profit
margins.
In terms of managerial and technical
sustainability, while the immediate
danger of project failure does seem to be
mitigated with the continuing stay of the
Chinese team, potential problems are still
visible. For instance, the lack of effective
participation of the local partners in the daily
management of the ATDCs, compounded by
the typical Chinese-dominated structure of
management, generates the risk of leaving

26 27
the local partners incapable of operating
the Centres independently. Technically, the
overwhelmingly farmer-centred training
model also makes it less likely for the local
agro-technicians to conduct the extension
of Chinese farming techniques on their own.
Moreover, we find that the problems
mentioned above can be largely explained
from two aspects. First, from a policy design
point of view, while the multi-objectives
of the ATDC would naturally call for a more
detailed and delicately designed action
plan, the existing policy is very unspecific.
Particularly relevant to the point is the design
of the Business Operation Stage, which is
supposed to be the most innovative part of
the ATDC project but in reality, has been full
of ambiguities and uncertainties. In addition,
full consideration of local conditions and
adequate feasibility studies seem to be
lacking in certain instances, as seen by
the post-training application and farming
cultural difference problems as well as
the economically unviable prospect of the
Business Operation Stage. Moreover, the
government-company cooperation model
remains largely unstructured.
Second, bilateral interactions between
the Chinese government/company actors
and their African counterparts seem to be
ineffective.Thedetachmentofthetechnology
transfer from the host countries’ broader
extension, for example, has something to do
with the lack of effective communications
between the two sides. The sustainability
problem can also be partially attributed to
the lack of adequate participation of the local
actors in the daily operation as well as the
deficiency of joint efforts between the two
governments in making plans for the ATDCs’
future development.
In light of this, we find that several things
could be done in order to improve the ATDC
performance: (1) The Chinese government
may need to develop a more detailed and
feasible action plans for the ATDCs’ Business
Operation Stage. (2) A more solid arrangement
as to the government-company cooperation
model needs to be initiated, with a view to
institutionalising the companies’ obligations
in delivering aid projects as well as the
supportive measures that are meant to be
taken by the government. (3) All through the
planning and implementation of the ATDC
project, the Chinese government should
encourage a more active participation
of their local African counterparts in the
process, and make concrete measures to
facilitate, for instance, a gradual change
from the Chinese-dominated management
model into a more co-operative or localised
management model.
II. Environmental Impact of
Chinese Investments in Africa’s
Agricultural Sector:
Tang Xiaoyang

General Trend
The economic ties between China and Africa
have witnessed rapid and continuous growth
for the last decade. Bilateral trade volume
has increased from US$ 10.59 billion in 2000
to US$ 210.25 billion in 2013, an increase of
twenty times within fourteen years. More
recently, Chinese enterprises shifted their
focus from trade to investment. According to
the Chinese Ministry of Commerce (MOFCOM)’s
database, there were only 888 enterprises
registered to invest in Africa before 2010.
However, from January 2010 to January 2015,
2161 firms had registered their outward
investments to Africa. That is to say, the
number of Chinese investments in Africa
all three focus industries of this study are
substantial, extractives is one of the largest
categories of Chinese investment, whereas
only 7% of Chinese investments in Africa
are agriculture-related. Construction is in
between, with approximately one-quarter
of Chinese investments in Africa in that
sector. Chinese Investors are reluctant
to invest in Africa’s agricultural sector
because it requires huge investment upfront
and takes long time to get the return. The
deficient supporting infrastructure and high
economic and political risk in Africa are also
daunting to foreigners. In addition, the social
controversies on “land grab” issues alerted
Chinese government and Chinese firms when
they come to invest. However, caution should
be used in interpreting this data with these
industries in particular, as these numbers
about the number of firms may not correlate
with the size of investments (i.e., a giant
construction project is still counted as only
one investment in this data, despite its large
size).
TABLE: Top sectors of Chinese investment in
Africa
Industry
% of
MOF-
COM-reg-
istered
firms
Wholesale and retail trade 70.9%
Manufacturing 47.9%
Mining 46.9%
Leasing and business service 29.9%
Scientific, technical services
and geological prospecting 29.2%
Construction industry 23.4%
Residential services and other
services 8.3%
within the past five years more than doubled
the total number of investments from the
previous twenty years. Correspondingly,
the stock of Chinese outward foreign direct
investment (“FDI”) in Africa also rose from
US$ 0.618 billion in 2003 to US$ 26.19 billion
in 2013.
The rapid expansion of Chinese investments
in Africa has attracted global attention.
Policymakers, business people, civil society,
and citizens are not only interested in
investigating how Chinese investments
influence Africa economically and politically,
but also are concerned with the impact
of Chinese enterprises on the continent’s
environment. Africa is well known for its
pristine forest and savanna, for the natural
life which is still relatively untouched by
industrialisation, and for unique but fragile
ecosystems which are facing the serious
challenge of global climate change. When a
large number of Chinese enterprises enter the
continent, they are set to alter the landscape
greatly through the gigantic scale of
construction and operations. Unfortunately,
Chinese enterprises do not have a good
track record of environmental practice
either domestically or overseas. They are
often criticised for reckless commercial
exploitation without sufficient consideration
of social-environmental consequences.
Chinese firms are involved in a range of
sectors spanning services, manufacturing,
construction, extractives, and agriculture.
Based on the MOFCOM database, we know
that three industries dominate: over 70% of
registered investments involved whole or
retail trade, and nearly half of investments
involved mining and manufacturing activities.
The table below lists the percent of MOFCOM
registered investments with activity in each
industry. This data helps put the three focus
industries of this study in perspective: while

28 29
Agriculture, forestry, animal
husbandry and fishery 7.3%
Real Estate 4.3%
Transportation, storage and
postal services 3.7%
Hospitality industry 1.8%
Information transmission, com-
puter services and software 1.0%
Electricity, gas and water pro-
duction and supply 0.5%
Financial industry 0.4%
Culture, sports and entertain-
ment 0.4%
Education 0.2%
Health, social security and
social welfare 0.1%
Water conservancy, envi-
ronment and public facilities
management 0.1%
Public administration and so-
cial organisations 0.1%
International organizations 0.0%
Environmental Impacts of Chinese
Investments
The environmental and social practices of
Chinese farms vary across type of investment
and countries.
On the positive side, many Chinese farmers
in Africa appreciate the relatively unspoiled
natural environment in Africa and, drawing
lessons from China’s history of environmental
deterioration, actively take measures
to preserve the ecosystem in Africa. For
example, Wanbao rice farm in Mozambique
does not use machines to dispel birds like
local farmers do. In the farmer’s opinion, local
farmers dispel birds because they believe
birds eat a large portion of their grains.
However, the situation is different for the
Wanbao farmers. A manager Luo Yonghao
said, “Our yields are large. What the birds
eat is just a very small portion. It is able to
achieve better yields because around 70% of
birds’ diets are pests, which benefits farming
activity”. In comparison, the volume of crops
that birds consume is relatively insignificant.
In addition, the Wanbao farmer does not use
pesticides and instead uses herbicides and
a small amount of urea as fertiliser. As the
manager Luo Yonghao said, “In China, the
use of pesticides caused a vicious circle.
Pesticides killed insects, as well as insects’
predators, namely birds. The reduction of
birds caused an increase of pests, and made
farmersmorereliantonpesticides.” Learning
from this lesson, the Wanbao farm attaches
great importance to maintaining the existing
ecological system. Here, there is a voluntary
action by firms driven by self-interest,
because firms recognise that investment in
environmental protection today will mitigate
costs in the future.
On the problematic side, a serious threat
to Africa’s ecosystem is illegal logging
and timber smuggling by Chinese firms. In
response to these concerns, the Chinese
State Forestry Administration (“SFA”) and the
Chinese Ministry of Commerce jointly issued
the “Guidelines on Sustainable Overseas
Forests Management and Utilization by
Chinese Enterprises” in 2009. Chinese
officials blame mainly private businessmen
fortheseunlawfulactivities. Thisisconfirmed
by a report from the Center for International
Forest Research (“CIFOR”), which has tracked
this issue in detail.
In addition, numerous Chinese firms bring
vegetable seeds to grow in the companies’
backyards to supply vegetables for their
own consumption. It is not uncommon to
visit a Chinese factory or construction site
in Africa and find a neatly tended plot of land
with Chinese vegetables inside the grounds.
There seems to be little regulation or even
awareness of this practice on the part of
government authorities. Though at a small
scale, alien plant-life may cause unexpected
disruption of the local ecosystem. This
is not to say that all Chinese agricultural
innovation is under-the-radar: several
Chinese agri-tech companies are promoting
new varieties of crops in Ethiopia, Tanzania,
Liberia, Madagascar, and other countries,
and they at least claim to abide by local legal
requirements and procedures for approval.
Regulatory Efforts
Chinese enterprises in Africa are first and
foremost subject to regulation by local
authorities. From environmental impact
assessment to regular environmental
inspections, each African country’s
legislation and administration set up the
regulatory framework that all investors,
whether from China or elsewhere, need
to follow. Traditionally, China has been a
strong advocate of the principle of judicial
sovereignty, the notion that outsiders should
not interfere in African authorities’ regulation
of enterprises in their own countries. In line
with its famous ‘non-interference’ foreign
policy, the Chinese government has long
stressed that Chinese investors overseas
should fully abide by local authorities.
However, the rapid increase of Chinese
investments in Africa and the accompanying
controversies about Chinese enterprises’
environmental practices have brought
growing pressure on the Chinese government.
Reports on incidents such as the illegal
Chinese gold miners in Ghana or the oil spill in
Chad tarnished China’s international image.
A survey by the Ethics Institute of South
Africa showed that citizens of multiple African
countries have negative perceptions about
Chinese companies. In all aspects, such as
product quality, employment practice, social
responsibility, and economic responsibility,
respondents had negative views of Chinese
companies outnumbered those who held a
positive view. In particular, the environmental
responsibility of Chinese firms was viewed
negatively: 53.9% of the interviewees had
negative views, and only 11.1% had positive
views. The ballooning amount of complaints
among African public and international
society must have attracted the Chinese
government’s attention. Whether out of
concerns about its reputation or for the
purpose of securing friendly relationships
with African nations, the Chinese government
has taken a series of steps lately to address
the socio-environmental practices of Chinese
enterprises in Africa more actively.
At the end of 2007, the State-owned Assets
Supervision and Administration Commission
of the State Council (“SASAC”), the Chinese
government agency that owns and regulates
central government-owned enterprises
promulgated the “Guidelines to the State-
owned Enterprises Directly under the
Central Government on Fulfilling Corporate
Social Responsibilities”. The document
emphasises the importance of corporate
social responsibility for Chinese state-owned
enterprises and asks SOEs to take measures
for “constantly improving the ability of making
sustainable profits.” Social responsibility is
defined broadly as product safety, resource
conservation, technological innovation,
employee rights, and public welfare. SOEs
are asked to establish a communication
mechanism to disclose CSR activities and
engage stakeholders.
In March 2009, MOFCOM and the State
Forestry Administration jointly published
the “Guide on Sustainable Overseas Forests
Management and Utilization by Chinese
Enterprises.” In February 2013, MOFCOM and

30 31
MEP also jointly published the “Environmental
Protection Guide for Outbound Investment
and Cooperation.” These documents require
Chinese enterprises not only to abide by
forestry and environmental protection
laws of the country in which they are doing
business but also to conduct environmental
assessments and create an environmental
management plan. Chinese enterprises are
encouraged to engage in green procurement,
recycling, and local community activities.
In addition, Chinese business associations
of various sectors have issued or are
working on CSR guidelines for the outbound
investments in their sectors. In September
2012, China International Contractors
Association released the “Guide on Social
Responsibility for Chinese International
Contractors” to “establish a benchmark of
social responsibility” for construction firms
and to encourage them to operate overseas
contracting projects in a more responsible
way. Regarding environmental protection,
the guide gives instructions on four aspects:
environmental management, resource
saving, waste and emission reduction,
and ecological protection. On October
2014, the China Chamber of Commerce of
Metals, Minerals & Chemicals Importers
& Exporters issued the “Guidelines for
Social Responsibility in Outbound Mining
Investments.” The guidelines acknowledge
that mining may have a significant impact on
the environment and requires that Chinese
firms develop appropriate plans and conduct
regular assessments.
Though these documents cover a wide
range of CSR topics, notably, these Chinese
texts are “Guides” or “Guidelines” rather
than laws and regulations. Therefore, they
operate more as suggestions and lack the
binding force that laws have. Language-
wise, these guidelines rarely employ the
imperative “shall” and instead often use
the term “encourage” for environmental and
social-protection actions. All the guidelines
emphasise that Chinese businesses should
respect and abide by local laws in the country
of investment. Consequently, the guidelines
are written in rather general terms, with
no specification for investment types or
risk levels of investments. The guidelines
presume that companies will find specific
regulations in their host countries and decide
their behaviours correspondingly.
Challenges Ahead
Yet, this general orientation has been
problematic in the African context. African
countries’ environmental regulations are
not always well established. Indeed, some
foreign investors can make use of loopholes
in legislation and administration to lower
environmental treatment standards ‘legally.’
Under such circumstances, the principle of
abiding by local regulations may sound like
empty words. Moreover, Chinese firms on
average have limited knowledge of local laws.
As Weiqian Yang, a Chinese lawyer in Ghana,
said, “Chinese companies are not used to
looking into laws to find their behaviour
standards. They believe that money is the
lubricant which can get everything done.”
To some extent, this is a continuation of
common business normal, private-sector
behaviour in China, where connections with
officials are often more important than laws.
In the Yang’s opinion, Chinese managers only
vaguely knew the local regulations vaguely,
and few of them had a precise understanding
of the legal system and its requirements.
One reason for this situation is the lack of
Chinese legal professionals working in Africa.
In fact, among over a thousand Chinese
interviewed by the authors across sixteen
African countries during last seven years,
Yang in Ghana was the only Chinese lawyer
who was a licensed lawyer in an African
country encountered. This entrepreneurial
culture of considering money rather than
laws is an impediment to Chinese investors
and keeps them from carefully studying and
obeying local regulations.
In spite of the practical difficulty of
applying these guidelines to Africa’s reality,
the promulgation of the guidelines did
demonstrate the Chinese government’s and
the industry’s pro-active attitude regarding
socio-environmental impact, with a particular
emphasis on environmental issues. Not only
do all the guidelines mention environmental
responsibility, but as described above,
two major documents are dedicated to
environmental protection. As Radavoi and
Bianobserved,theChinesegovernmenttends
to detach the environmental issues from
those of workers’ or human rights, because
transnational regulations of environmental
practices are less controversial politically
and are perceived to be more feasible to
implement. The release of five guidelines
within seven years was a promising start
for China to regulate its extraterritorial
corporations. However, the implementation
challenges show that mere guidelines from
the Chinese government are not sufficient.
Putting effective changes into practice
requires more actions and more stakeholders.
Besides, most Chinese firms see
environmentalandsocially-orientedactivities
as a cost centre rather than profit-generating
investments. Hence, their spending on CSR,
environmental protection, and other such
activities are generally sporadic. They do not
see it as part of their core competence and
do not think that related investments help
their business.
However, as Chinese investments cover a
broadrangeofcountriesandsectorsinAfrica,
compliance with social and environmental
standards and willingness to invest beyond
minimum standards vary as well. Generally
speaking, however, there is a divide between
large state-owned companies and small
private businesses. The larger companies
(with a capital of over USD 10 million), most of
which are state-owned enterprises, pay more
attention to socio-environmental issues,
whereas the smaller private business often
evades government control and sometimes
unscrupulously pursue profit at the cost of
environmental and social concerns. As an
official in the Chinese Ministry of Environment
Protection (MEP) said, “Large state-owned
enterprises are doing fine with CSR. They have
thecapacityandawarenesstodoit. Thesmall
private companies are more problematic,
especially the mining and timber traders.
They cause damage to Africa’s environment
and are very difficult to manage.”
There are three reasons for this gap. First,
large companies usually have long-term
investmenthorizons. Hence,theyhaveastake
in creating a friendly investment environment
in the host country, whereas private
businesses can be short-term focused,
moving to another country if the investment
environment sours due to environmental or
social damage. Secondly, large companies
are often scrutinised more closely by the
authorities and by the public. Thus, quite a
few of them have dedicated CSR departments
and more sophisticated attitudes towards
socio-environmental issues. In contrast,
smaller private companies are more inclined
to solve problems that arise in an ad hoc
manner, or ‘under the table.’ Thirdly, Chinese
embassies in each country regularly contact
and visit the larger companies, but have no
capacity to track smaller companies, with the
exception of crisis situations.

32 33
III. Africa-China Collaboration
on Agricultural Development:
Foreign Direct Investment (FDI)
and Development Assistance:
Gedion Jalata8
Africa is endowed with abundant natural
resources. The continent has about 12
% of the world’s arable land, of which 60
% uncultivated. Moreover, only 7% of the
arable land is irrigated compared to 40 % in
Asia. Smallholder farmers account for most
of the cultivated land and a sizable share of
agriculture production, for instance, more
than 75% of the total agriculture outputs in
Kenya, Tanzania, Ethiopia and Uganda are
producedbysmallholderfarmerswithaverage
farmsizesofabout2.5ha.Agricultureremains
the mainstay of most economies in Africa
accounting for an average 30% of Africa’s
total GDP. The sector also employs about 65-
70 % of Africa’s labour force.9
This makes the
sector key for food security, employment,
growth and development in the continent.
Agriculture led growth has the largest
impacts in reducing poverty as demonstrated
in Ethiopia, Rwanda and Ghana.
Challenges of Agriculture Development in
Africa
The Agriculture sector has not witnessed
impressive growth due to a combination of
factorssuchas:lackofpoliticalwilltosupport
the sector, price risk and non-conducive
policies, low attention given by international
development partners, climate change
related challenges such as increased soil
degradation, salinization of irrigated areas,
challenges in infrastructure development and
market access, low agriculture research and
8 Mr. Gedion Jalata spoke on his personal capacity as a
researcher, not on his official capacity for OI-AU
9 ECA. 2014. Frontier Markets in Africa-Misperception in a Sea
of Opportunities. Addis Ababa, Ethiopia. P.14
development in Sub-Saharan Africa, which
standshalfofwhatIndiaspendsandaquarter
of what the US spends, and considerable
financing requirements (11 billion per year
for agriculture outputs expansion) while the
continent is losing 50 billion per year because
of illicit financial flows in trade mispricing
alone.
China-Africa Partnership: Trade, Foreign
Direct Investment (FDI) and Development
Assistance
The top five African countries main exports
to China are mineral products (55%), base
metals (4%), precious stones and metals
(3%), textile and clothing (1%), and other
unclassified goods (26%). Moreover, China
is trying to increase imports from least
developed African countries by allowing
agricultural products to enter duty-free to
its market. Accordingly, African agricultural
product export to China is increasing from
time to time albeit it is marginal in the current
trade relationship. See figure I on Africa’s
main export to China.
Source: World Trade Atlas, 2014.
Ontheotherhand,ChineseexportstoAfricaare
high-value manufactured goods. In particular
transportation equipment, machinery, and
electronic products account for half of
the exports. Other export products are textile
and clothing, footwear and plastic products.
Chinese FDI is also increasing from time to
time in Africa. Official China White Paper
indicated cumulative FDI in Africa at end of
2012 totalled $22 billion. The recent Forum
on China-Africa Cooperation (FOCAC) in
December 2015, held in Johannesburg, South
Africa, unveiled that China’s investment in
Africa increased to $ 32.35 billion in 2015
with over 3000 Chinese companies operating
across the continent. The principal target
of Chinese FDI in Africa is the construction
sector followed by transportation, storage
and postal service, manufacturing, mining,
finance, leasing and business services,
agriculture, forestry, animal husbandry and
fishery and others. Agriculture constitutes a
very minimal percentage i.e., 4.1% in Chinese
foreign direct investment stock in Africa.
China is also developing 7 economic and trade
cooperation zones in Africa; two in Zambia,
two in Nigeria, and one each in Mauritius,
Egypt and Ethiopia. Chinese investment in
African countries is backed by China-Africa
Development Fund, which invested around $
3 billion and Special loan for the Development
of African Small and Medium Enterprises
(SMEs) funded by the China Development
Bank.
As the overall trend indicates Chinese FDI is
growingfasterthanWesternFDI.Nonetheless,
Chinese FDI to Africa is in a small percentage
of its global FDI i.e., only about 4 percent.
China’s FDI in Africa mainly distributed in
Algeria, Zambia, Kenya, Congo (Brazzaville),
Nigeria, Central Africa, Sudan, Tanzania and
Egypt. See figure II below on composition of
outward Chinese FDI stock in Africa (2014).
Source: Statistical Bulletin of China’s Outward Foreign Direct Investment, 2014: 99.
Figure II: Composition of Outward Chinese Industrial Distribution FDI Flows in Africa in 2014
(in %)

34 35
Chinese development assistance to Africa as
well is another important feature of Africa-
China cooperation. China has been providing
development assistance in different sectors
of the African economy. The most notable
ones are infrastructure, telecommunication,
energy generation and supply, manufacturing
andindustryaswellastheagriculturesectors.
In this regard, China provided $ 14.4 billion of
development assistance, half of which was
provided to 51 African countries through more
than 2,500 development projects, with a total
of approximately $ 7.5 billion. Moreover, in the
recent FOCAC, noted above, China pledged
to give $60 billion as a development fund (in
various kind of support) to African countries
i.e., loans, preferential loans, export credits,
concessional foreign aid loans ($35 billion);
China-Africa Development Fund, (CAD Fund
for equity investment, $5 billion); small and
medium enterprise (SME) credit line ($5
billion); grants and zero interest loans ($5
billion); and a new China-Africa Cooperation
Fund with $10 billion to African countries.
The trends in the past six FOCAC since 2000
reflect huge financial commitments from
China to Africa. Furthermore, China provided
$ 3 billion to South-South Climate Change
Cooperation Fund and an additional $ 2 billion
to aid developing countries to implement
Sustainable Development Goals (SDGs).
At the recently held Summit of the Forum
on China-Africa Cooperation (FOCAC) in
Johannesburg, South Africa, in December
2015, leaders agreed to a comprehensive
strategic and cooperative partnership based
on five pillars and ten major cooperation
plans from 2016 to 2018. The priority
areas in this regard include agricultural
modernisation and food security, industry
partnering and industrial capacity
cooperation, infrastructure development,
energy and natural resources, ocean
economy, tourism, investment and economic
cooperation, environmental protection and
tackling climate change, peace and security
cooperation among others.
China-Africa Collaboration on Agriculture
Developments
It is important to note that China has been
involved in Africa agriculture almost half a
century. Nonetheless, it was in most recent
years i.e., after the zero-tariff policy that the
Chinese government adopted in subsequent
FOCACs (2003 and 2006) for least developed
African countries and some products coming
from Africa, agriculture export (noon-food
items such as cotton, hemp, silk, and
oilseeds) from Africa to China increased.
China’s FDI in African agriculture is also
increasing fast in particular in breeding
improved seeds, planting grain and cash
crops, and processing agricultural products.
For instance, it grew from US$30 million in
2009 to US$82.47 million in 2012. Chinese
agriculture support to African countries
comes in both monetary and in-kind forms to
support food production, breeding, storage
and transport, infrastructure development
and etc. Financing services for the agriculture
sector comes from Chinese banks. Since
2006,Chinahasbuiltmorethan40agricultural
demonstration centres in Rwanda, the
Republic of Congo, Mozambique, Ethiopia and
some other countries. The country has also
sent agricultural technology team to provide
policy consulting, teach practical techniques
and train local staff.
In general, agriculture played a central
role in China’s own economic development
and sharing these experience has been a
consistent priority in China’s engagements in
Africa. Chinese cooperation for the sector in
Africa focused on technocratic and capacity
building interventions as well as providing
hybrid seed, which is influenced by China’s
own domestic development experience.
Challenges in Agriculture Cooperation
Chinese support to the agriculture sector by
any standards i.e., trade relation, investment
and development cooperation is very low.
Critics also argue that Chinese development
assistance and foreign direct investment may
have potential food security conflict between
China and African countries. Evidence on the
ground, however, indicates that Chinese
farms in Africa are producing solely to the
local market or to export to global markers.
Chinese agricultural investment in Africa
focused on agricultural technology and
seed cultivations through demonstration
parks. Hybrid rice is a central technology
for dissemination in these parks. Such rice
is stronger and more productive than their
parent stock yet they have limitations i.e.,
they have to be purchased again and again
from MNCs as they do not reproduce the
genetic traits of their parents.
Chinese agriculture support did not
investigate the economic dynamics such as
markets, transportation or distribution, or the
institutional chain required for the support
of hybrid rice rather focused on technical
transfer by demonstrating, teaching and
repairing.
There is also a huge gap not only in
communication between Chinese experts
and African counterpart but also in
agriculture between China and Africa i.e.,
Chinese farmers use intensive agriculture
while African farmers use shifting cultivation
depends on fallow systems, which may create
misunderstanding between the two.
Leveraging China-Africa Cooperation for
Agriculture Development
In spite of the aforementioned challenges,
agriculture is an emerging area for China’s
engagement in Africa and there seems a
brightprospectforthesectorforthefollowing
reasons:
• As Africa needs China, China also needs
Africa for the reason that Africa’s
resources, including its land, low-
cost resources, and labour and market
connections are vital for agri-business
and trade plans.
• African countries can share experience
from Chinese smallholder agricultural
policy and institutional capacity through
development cooperation efforts.
• Agricultural development assistance is
considered as complementary to Chinese
growing interest in energy and mineral
exploitation. As the director of China, farm
Agribusiness Corporation commented:
“China should offer to combine
exploitation of other countries’ resources
with the help for their agriculture”
• The competition between China and other
emerging economies such as Brazil as
vividly seen in their involvement in the
agriculture sector in Mozambique and
Ghana influence China to enhance its
agriculture support to African countries.
Deepening China-Africa Partnership in the
Agriculture Development
• African agriculture is at a turning point
with growing momentum to transform.
Bringing agricultural transformation and
scaling up agricultural productivity is the
sole responsibility of Africans. To bring
development in the continent requires
consistent and broad-based growth
spearheaded by the agriculture sector
accompanied by dramatic improvements
in infrastructure, governance and
other social indicators. Political will,

36 37
determination and commitments are,
thus, timely and pertinent to develop and
use the agricultural sector as an engine
of economic transformation in Africa.
• This, however, does not mean that Africa
does not need a hand of solidarity to
address its poverty and to develop its
own potential for agricultural productivity
and transformation as well as feeding its
ever increasing population. Africa needs
to draw pertinent lessons on agricultural
development from emerging economies
of China, India and Brazil by investing
moreofitsownresourcesintoagricultural
science, agricultural education and
research as well as technology.
• It is important to recognise that the
agriculture sector in China was not
developed through development
assistance rather through a combination
ofmarketreforms,tradeandforeigndirect
investment. Various kinds of development
assistance, likewise, did not significantly
help African countries to transform their
agricultural sector. In this regard, each
African country must recognise the
importance of the agricultural sector
for economic development and develop
sound agricultural sector policy and
strategy i.e. pro-poor, pro-rural, and
a consistent policy that focuses on
productivity-based staple crop-led
agricultural development as well as a
policy that links the effect of agriculture
with industrialization, and request China
and other emerging powers to support its
policy.
• As rightly indicated by Deng Xiaoping,
the Chinese foremost reformist leader,
agriculture development relied on policy
first and on science and technology
second. Accordingly, agricultural
productivity enablers for small holder’s
farmers such as technology adoption,
input-output markets, access to finance,
policy environment, institutional and
human capacity building must be
provided by the government. Public
investment including in irrigation,
rural infrastructure and research and
development to accelerate agricultural
productivity with special attention to
smallholder and women is badly needed.
Strengthening national, sub-regional
and continental capacities to generate
and manage knowledge that supports
evidence-based planning and evaluation
of CAADP is crucial.
• There is a debate whether Chinese
agriculture model can be replicated in
Africa or not, which is fashioned based on
Chinese own experience. It is important to
note that success in agriculture crucially
depends on the indigenous scientific
capacity to generate new technology
that suit the specific context both in the
continent and each African country. It
is important, for instance, to recognise
that neither rice nor wheat, which
spearheaded the Green Revolution in
Asia, is of importance to Africa. This is
mainly for the reason that the continent’s
output for each is only 2 percent of
world production. Rather major crops
in Africa such as millet and sorghum,
which constitute 40 % and 18 % of world
production; yam, plantain and cassava,
which represent 95 %, 70 % and 44 % of
world production must be given priorities
both in the African green revolution but
also in Chinese agricultural development
assistance to Africa.10
• This indicates that ensuring a food
10 Alliance for a Green Revolution in Africa (AGRA). 2013. Afri-
ca Agriculture Status Report: Focus on Staple Crops. Ken-
ya: Smart Printers. P. 6
• secure and prosperous Africa in a
sustainable way require a unique
Green Revolution. This can be done by
increasing agricultural productivity
through investments in research and
technology, infrastructure, as well as
providing the enabling environment for
the private sector, including farmers
to promote agribusiness. It will also
require rethinking agriculture to involve
a value chain approach from the supply
or production side to demand or the
consumption side.
• There are huge financial gaps to
transform the agriculture sector in Africa
as noted above. In this regard, diverse
actors in the agriculture sector in Africa
must be encouraged to be involved.
These are farmers as the main financier,
followed by public investments, which
are vital for overcoming challenges, and
foreign private and public investments.
Smallholder agriculture has enormous
potential to make a significant
contribution to economic development
and poverty reduction in Sub-Saharan
Africa. It is the largest single source of
economic livelihoods, employing up to 80
% of the rural population.
• This must be supported by agriculture
policy and development intervention.
Indeed, the Green Revolution in Asia was
state-driven; market-mediated and used
small-farmer based strategy. To fill the
financing gap for agriculture sector in
Africa foreign direct investment inflows
throughforeignprivatecompaniesisseen
as an important resource. Furthermore,
employing different innovative financing
approaches for agricultural development
in Africa is also vital. This can be
done using private and public sector
investments as well as through public-
private partnership.
• It is also important to understand
the nature of Chinese development
cooperation to Africa i.e. strategic,
planned and long term goal. In this
regard, China is getting benefits from its
agricultural support to African countries.
First of all, Chinese technicians are
gaining tremendous know-how on the
nature of African agriculture and able
to influence subsequent developments
in the continent. Second, through
its investment Chinese companies
derive revenues from the agriculture
infrastructure support to African
countries.
• Chinese development cooperation is
based on a request from the recipient
country following its strategic policy
priorities, and recipient country strong
bureaucracytoexecutepoliciesaswellas
pledges made at FOCAC every three years.
Following FOCAC pledge individual African
country is expected to negotiate further
togetitsportionfromthepledge.The‘One
China’ policy, which required countries to
recognise Taiwan as part of the mainland
China is still a requirement for African
countries to get development assistance
from China. African countries, therefore,
need to develop their agriculture sector
policy and strategy accordingly and
leverage Chinese engagement in the
agriculture sector.
• African countries are also expected to
strengthen its bureaucratic capacity to
implement policies successfully. African
countries may also draw lessons from the
previous failures of Chinese agricultural
development as the country had similar
difficulties in transforming the agriculture
sector for sometimes back. Indeed, the
agricultural sector reforms it still on-

38 39
going in China.
• As noted above there is a huge systemic
difference between China and Africa
agriculture. In this regard, the Chinese
government must do a lot in supporting
its companies and agricultural experts
develop a deeper understanding of
African rural culture, society and history.
Furthermore, to support the low research
and agricultural development centre in
Africa, Chinese development assistance
in agriculture research and development
through demonstration centre across
Africa is highly encouraged and
appreciated. Nonetheless, this must be
with active participation from the locals
in particular on agriculture project design
and implementation.
• Finally, Chinese support in the agriculture
sector should be on how the agriculture
sector may have rapid development in
terms of foreign exchange earnings,
export diversification, employment
generation, and linkage effects. In this
regard,Chinamustscaleupitsagriculture
development assistance to Africa in
particular by promoting agro-processing
industrial parks, meat processing, value
addition on agricultural products, and
leather and leather products as well as
supporting agricultural value chain in
Africa.
Session III: Making Africa-China
Engagement work for Africa’s
sustainable development – The
Regional Impact and Beyond
This session discussed the future for Africa-
China engagement and areas that are needed
for new research. Panellists discussed how,
in going forward, Chinese OFDI could work
for Africa’s sustainable development. They
looked at both African Union frameworks
and new policy aspirations that were defined
at the 6th
FOCAC. Panellists include Diana
Oyena Akullo, a Policy Officer at the African
Union Commission, Amb. Shu Zhan, Research
Fellow at the Institute of African Studies at
Zhejiang Normal University and Dr. Witness
Simbanegavi, Research Director at the African
Economic Research Consortium (AERC).
I. Making Africa-China
Engagement work for Africa’s
Sustainable Development – The
Comprehensive Africa Agriculture
Development Programme:
Diana Oyena Akullo
Introduction
In 2013, the 21st
Ordinary Session of the
Assembly of Heads of States at the 50th
Anniversary of the establishing of the OAU/
AU adopted a Solemn Declaration, which
amongst others pledged their commitment to
making progress in Africa in the next 50 years
in the following eight key areas:
§ African Identity and Renaissance.
• Struggle against Colonialism and
Self-Determination.
• Pursuing the Integration Agenda.
• Social and Economic Development.
• Peace and Security.
• Democratic Governance.
• Determining Africa’s Destiny.
• Africa’s Place in the World.
The Assembly directed that the AUC with
supportfromAfDB,UNECAandNEPADguidethe
process of translating these ideals into reality
through a people-driven Agenda to realise
the AU Vision of “an integrated, prosperous
and peaceful Africa, driven by its own citizens
and representing a dynamic force in the
world”. Agenda 2063 was thus developed
to this effect and currently the endorsed
framework for Africa’s inclusive growth and
socio-economic development within the next
half-century. It seeks to discover, harness
and protect Africa’s resources for the benefit
of all Africans. Agenda 2063 is thus defined
by:
(1) The Vision of the AU, the Solemn
Declaration and the Peoples’
Aspiration.
(2) The Transformation Framework with
clear Goals, Targets, Implementation
Arrangements, and Monitoring and
Evaluation Framework as well as the
Resource Mobilization Strategy.
(3) The Plan 10 year medium term plan
over the 50 years.
The Value Addition of Agenda 2063
Agenda 2063 should be seen as a new
phase in efforts by Africans to catalyse the
development of the continent to strengthen
African integration and unity. It aims to
build upon the achievements and draw
From Right to Left: Diana Oyena Akullo, Amb. Shu Zhan,
Dr. Witness Simbanegavi and Ms. Sipho Mthathi

Africa china dialogue Launch - report.

Africa china dialogue Launch - report.

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