Dambisa Moyo: Right and Wrong About China in Africa

July 7, 2012

Dambisa Moyo recently wrote an op-ed in the New York Times asserting that the surge in investment by China in Africa has been a positive development for the continent.  A lot of people take issue with Moyo’s oversimplification of highly complex problems, sweeping generalizations, and lack of analytical rigor.  I tend to agree with many of her points, as I have discussed in this blog, with the exception of a few critical assertions.

First, Moyo, the development economics pugilist who believes that foreign aid undermines democracy and growth in the third world, discusses China’s motivations for investing in Africa, explaining why, unlike other exchanges between governments, it is a mutually-beneficial relationship between two countries:

Despite all the scaremongering, China’s motives for investing in Africa are actually quite pure. To satisfy China’s population and prevent a crisis of legitimacy for their rule, leaders in Beijing need to keep economic growth rates high and continue to bring hundreds of millions of people out of poverty. And to do so, China needs arable land, oil and minerals. Pursuing imperial or colonial ambitions with masses of impoverished people at home would be wholly irrational and out of sync with China’s current strategic thinking.

Moreover, the evidence does not support a claim that Africans themselves feel exploited. To the contrary, China’s role is broadly welcomed across the continent. A 2007 Pew Research Center survey of 10 sub-Saharan African countries found that Africans overwhelmingly viewed Chinese economic growth as beneficial. In virtually all countries surveyed, China’s involvement was viewed in a much more positive light than America’s; in Senegal, 86 percent said China’s role in their country helped make things better, compared with 56 percent who felt that way about America’s role. In Kenya, 91 percent of respondents said they believed China’s influence was positive, versus only 74 percent for the United States.

Moyo is correct about China’s motivations.  As the world’s manufacturer and home to one of the fastest-growing consumer classes in the world, they have an insatiable demand for raw materials to ensure their factories are running.  Oil, natural gas, timber, and other materials are abundant in Africa and available to the highest bidder.  In the colonial era, European countries divided up Africa along arbitrary lines at the Berlin Conference, and used the newly-created countries as repositories raw materials without regard for the native populations.  As a result of severe mismanagement on the part of the colonial powers and poor governance after independence, populations not only saw none of the rewards of the natural resources taken from their countries, they were penalized in the form of inflation as one country after another succumbed to what is known as Dutch Disease, or the natural resource curse.

China, in contrast, frequently trades in-kind with African governments, building roads and hospitals in exchange for exclusive resource contracts.  By improving infrastructure and delivering results, the Chinese largely circumvent the traditional channels of corruption – no-bid contracts with firms started by politicians, for example – and ensure that the people benefit.  I saw this firsthand when driving along Thika Road, one of the largest Chinese infrastructure projects in Sub-Saharan Africa, which cut a two-hour commute down to 30 minutes for a huge number of people working in Nairobi.  I have written in the past about the impression these developments have left on Africans.  There is little doubt in my mind that, despite bouts of shady activity, the Chinese are a positive force in Africa.

Had Moyo stopped there, we would have been entirely in agreement.  But, I think she has a tendency in her essays and her books to view the world in binary, drawing clear lines of causality amid complex systems.  In the op-ed, she assigns blame for Africa’s governance problems on the influx of aid, which supposedly undermines the ability of the people to hold their leaders accountable for failures of government.

China’s critics ignore the root cause of why many African leaders are corrupt and unaccountable to their populations. For decades, many African governments have abdicated their responsibilities at home in return for the vast sums of money they receive from courting international donors and catering to them. Even well-intentioned aid undermines accountability. Aid severs the link between Africans and their governments, because citizens generally have no say in how the aid dollars are spent and governments too often respond to the needs of donors, rather than those of their citizens.

In a functioning democracy, a government receives revenues (largely in the form of taxes) from its citizens, and in return promises to provide public goods and services, like education, national security and infrastructure. If the government fails to deliver on its promises, it runs the risk of being voted out.

The fact that so many African governments can stay in power by relying on foreign aid that has few strings attached, instead of revenues from their own populations, allows corrupt politicians to remain in charge. Thankfully, the decrease in the flow of Western aid since the 2008 financial crisis offers a chance to remedy this structural failure so that, like others in the world, Africans can finally hold their governments accountable.

This is a relatively common theory of why Africa’s leaders are so unbelievably corrupt.  But I disagree for several reasons.  First, it shifts the blame from corrupt politicians to the supposedly enabling factors that entice them to steal.  This is ridiculous.  Corrupt leaders – African or other – steal because they are bad leaders and, I would say, bad people.

Results from the Corruption Perceptions Index

The fact that foreign governments provide the money for the education system does not mean that politicians are obligated to steal it.  They could, for example, use to it to build schools and pay teachers.  But, unfortunately, they often don’t, opting to steal the money instead.  This isn’t always the case, as Ellen Johnson Sirleaf in Liberia, John Atta Mills and Ghana, and other good democratic leaders have shown.  But, when it does happen, the donors are not to blame.  The blame rests solely with officials – elected and unelected – who chose to steal the money.

Second, Moyo believes that if countries stop giving foreign aid to corrupt governments, those governments will cease to be able to provide basic services to their people.  The people, in turn, will then rise up to overthrow the government, replacing it with a better, more honest government.  In theory, this is how democracy works.

In practice, the reason African leaders are not held accountable has less to do with foreign aid and more to do with their unwillingness to relinquish power after their term has ended.  In the days of the cold war, when the U.S. and Soviet Union purchased influence from corrupt autocrats like Mobutu Sese Seko in Zaire (now the DRC), you could possibly make this point.  But, today, I think that is hardly the case.  Take Zimbabwe.  Robert Mugabe violently represses all dissent, and has remained in power for 30 years.  His longevity has nothing to do with his ability to deliver services to his people (he doesn’t).  Laurent Gbagbo in Cote D’Ivoire killed hundreds of people to stay in power (he didn’t).  In the last year alone, the president of Mali, Ahmadou Toumani Toure, was overthrown in a coup, and the president of Uganda, Yoweri Museveni, brutally repressed protesters and political opponents.  Today, the leading candidate for president in Kenya, Uhuru Kenyatta, is currently on trial at the Hague for war crimes.  He was sent to the ICC for his role in the post-election violence of 2007.  If he is elected, it will have nothing to do with foreign aid.

In contrast, one leader who cites Dambisa Moyo as a offering a model path for Africa is known for systematic repression of dissent.  Paul Kagame, the president of Rwanda, has undoubtedly done great things for the country, in terms of economic development, healthcare, and other public services.  But his record on human rights has been questioned, at best, making his actions difficult for some stomach.  (As a caveat, the reasons underlying Kagame’s approach to governance are complex and can be discussed in another post.  My intent is not to take a stand – only to show that it is not cut-and-dry.)

The fact is that Chinese investment in Africa is a good thing.  But to draw a straight line of causality connecting foreign aid with prevalence of corruption and malfeasance in government is ludicrous.


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3 Responses to Dambisa Moyo: Right and Wrong About China in Africa

  1. Kate on August 10, 2012 at 9:09 pm

    “Corrupt leaders – African or other – steal because they are bad leaders and, I would say, bad people”. the world must be full of bad people for you including ordinary Africans “Its hypocritical for Africans to make it look like only the leaders are corrupt”. Her argument is flawed and so is yours and you make some sweeping generalizations and so does she.

  2. Mark Brown on August 14, 2012 at 8:09 am

    Thanks for the post Josh.

    I would push back on “First, it shifts the blame from corrupt politicians to the supposedly enabling factors that entice them to steal.”

    Circumstances that make it easy for people to steal will increase them to steal. You can’t vote for someone because they have the vibe of not being a thief. The last three major Prime Ministers of Canada were all also associated with corruption scandals and Harper may be as soon as he is out of power too.

    I think every country is acutely at risk to corruption and embezzlement until we make systemic changes and better align incentives.

    Nice post.

  3. Josh on August 23, 2012 at 3:13 pm

    Hey Mark – thanks for the feedback. You know I appreciate it when the major leaguers weigh in on here. I agree with you 100% that incentives are misaligned and corruption is systemic. But I think you can say the same thing about the financial crisis, when people shift blame from the banks to the regulators. “Of course they took crazy risks – it is because they weren’t regulated enough!” That argument sells short the banks that were responsible (like most in Canada), just like it sells short responsible politicians who win the Mo Ibrahim prize in Africa or work to cultivate a system where corruption isn’t tolerated in other parts of the world. I know there are incentives to steal. But it isn’t like “plato o plomo.” Just because you are incentivized to break the law, doesn’t mean you have to.

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