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China's Growing Economic Activity in Africa

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  • Hany Besada
  • Yang Wang
  • John Whalley

Abstract

Trade between the whole of Africa and China (imports and exports summed) grew from $10.6 billion to $73.3 billion between 2000 and 2007, and between Sub-Saharan Africa and China from $7 billion to $59 billion over the same period. China is now Africa's third largest trading partner behind the EU and the US. The Chinese FDI stock in Africa has grown from $49 million in 1990 to $2.6 billion in 2006. On the basis of these data, one frequently hears the claim that China is now a dominant influence in Africa. Here we both evaluate such claims, and assess what factors underlay this phenomenon. We suggest that while the annual growth rates of trade and investment flows are high (around 30% per year sine the late 1990's), the levels are still considerably smaller than such claims might suggest. China in 2006 accounted for only $520 million of inward FDI compared to a total from all sources of $36 billion, around 1.4% of total FDI inflows to Africa; and only 8.6% of African exports and 9.6% of African imports. African interdependence with China thus remains proportionally smaller than that for most other geographical areas, but is growing rapidly. Factors behind this growth are discussed in the text.

Suggested Citation

  • Hany Besada & Yang Wang & John Whalley, 2008. "China's Growing Economic Activity in Africa," NBER Working Papers 14024, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:14024
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    References listed on IDEAS

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    1. Harry G. Broadman, 2007. "Africa's Silk Road : China and India's New Economic Frontier," World Bank Publications, The World Bank, number 7186, April.
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    Cited by:

    1. Yin‐Wong Cheung & Jakob de Haan & Xingwang Qian & Shu Yu, 2012. "China's Outward Direct Investment in Africa," Review of International Economics, Wiley Blackwell, vol. 20(2), pages 201-220, May.
    2. Marcel Kordos, 2015. "Interakcia Amerického A Európskeho Systému Podnikovej Kultúry (On Interactions Between American And European Systems Of Corporate Culture)," Medzinarodne vztahy (Journal of International Relations), Ekonomická univerzita, Fakulta medzinárodných vzÅ¥ahov, vol. 13(1), pages 53-68.
    3. Mary-Françoise Renard, 2011. "Working Paper 126 - China’s Trade and FDI in Africa," Working Paper Series 297, African Development Bank.
    4. Frantisek Skvrnda, 2015. "O Vybraných Medzinárodno-Bezpečnostných Aspektoch Ukrajinskej Krízy V Historicko-Sociologickom Kontexte (On Selected International Security Aspects Of The Ukrainian Crisis In The Historical-Sociologic," Medzinarodne vztahy (Journal of International Relations), Ekonomická univerzita, Fakulta medzinárodných vzÅ¥ahov, vol. 13(1), pages 30-52.
    5. Eva Kovarova, 2015. "Foreign Direct Investment Inflows To Africa: Overview And Current Trends (Toky Priamych Zahraničných Investícií Do Afriky: Prehľad A Súčasné Trendy)," Medzinarodne vztahy (Journal of International Relations), Ekonomická univerzita, Fakulta medzinárodných vzÅ¥ahov, vol. 13(1), pages 69-86.
    6. Chong-Ko Peter Tzou, 2015. "The Lifting Of The European Union Arms Embargo Against China And Its Potential Impact On East Asian Security (Zrušenie Embarga Na Vývoz Zbraní Z Európskej Únie Do Číny A Jeho Potenciálny Dopad Na Bezp," Medzinarodne vztahy (Journal of International Relations), Ekonomická univerzita, Fakulta medzinárodných vzÅ¥ahov, vol. 13(1), pages 8-29.
    7. Broich, T. & Szirmai, A., 2014. "China's economic embrace of Africa: An international comparative perspective," MERIT Working Papers 049, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    8. Ludmila Lipkova & Martin Grancay, 2015. "Úvodník: Časopis Medzinárodné Vzťahy V Roku 2014 (Editorial: The Journal In 2014)," Medzinarodne vztahy (Journal of International Relations), Ekonomická univerzita, Fakulta medzinárodných vzÅ¥ahov, vol. 13(1), pages 5-7.

    More about this item

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F59 - International Economics - - International Relations, National Security, and International Political Economy - - - Other
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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