Africa Poised to Power Next Phase of Growth
When Vasco da Gama, the 15th century Portuguese explorer, landed in Kenya searching for a sea route from Europe to India, he found Chinese traders who had arrived in Malindi earlier that century following a series of expeditions sponsored by the Ming dynasty.
Today, five centuries later, as Western companies wake up to the enormous opportunities that Africa and its 1 billion population – the youngest in the world – presents, they are once again discovering that China has paved the way. Backed by Chinese government loans to African countries from, Chinese companies and an estimated 1 million plus Chinese workers have poured into Africa over the past decade, mostly in search of the raw materials to feed China’s voracious domestic economy.
Between 2001 and 2010, China’s Export-Import Bank extended $62.7 billion in loans to African countries, or $12.5 billion more than the World Bank. Over the same period, trade between Africa and China grew by more than 700 per cent with China replacing the U.S. as Africa’s biggest trading partner in 2009.
While some commentators have questioned China’s motivation for its interest in Africa, others argue that the Chinese appear to be primarily driven by commercial considerations and, by extension, that western companies could lose out unless they embrace Africa, described by many as ‘the last great frontier.’