China Reaches further Than Just Asia

Angola has been blessed in the continent with an embarrassment of riches. The country has a huge supply of both Oil and the 4th biggest Diamond fields in the world. After a 30 year civil war however they were not in a position to profit from this treasure. In 2002 when it ended they needed a helping hand. Enter the Chinese.

China has an insatiable appetite for resources that they need to keep their giant population moving forward. Angola has become their primary importer of oil with 790,000 bbl a day! To make sure they have preferable access to this black gold, China decided to cut deals with the country when it was on its knees. It offered many favourable loans of huge sums to help rebuild the country while also benefiting themselves.

China could offer loans with a payback cushion of 17 years rather than the 5 years on offer from the likes of Europe and USA. The money would go to infrastructure projects that low and behold had to go to Chinese contractors too. While this offered a cheap and speedy results, much of it has been questionable builds. As noted by an Angolan civil engineer. “You have buildings built by the Portuguese fifty years ago still standing, while Chinese buildings just a year old are collapsing. Yes they build very fast and very cheap. But it also comes down fast”

Chinese companies now number 500 in the African nation, and the Chinese diaspora is at almost 100,000. The companies are supposed to be employing 30% Angolan workers but most are blatantly ignoring the rule or only employing Angolans in the lowest roles.

Angolans have not benefitted much from the nations natural resource wealth. The average spend per day by a citizen is just under $2. Seeing Chinese workers getting rich off the backs of their land is always going to hurt. “We have always been slaves,” Luandan local Nascimento said. “We are lost in the world. We are the leftovers.”

This tension has exploded with some crazy stories about Chinese being cannibals and sod misers against Africans. While this is clear hyperbole it shows that the tension could ignite to something worse than words if not careful.

China have tried to integrate the citizens better than other nations who use foreign workers. While in other parts of the world foreign workers stay in expansive compounds hidden away, a drive around the capital in Angola, Luanda, reveals Chinese signs, markets and traditional Chinese music like the erhu being played from buildings.

Other countries have tried to come in with a softer approach. The USA are always interested whenever oil is in play and Angola is no different. Oil giant Chevron helped train thousands of workers and offered $160m in funding for projects. But it simply pales in comparison to Chinese investment.

China has given $30bn to Angola helping them rebuild a nation. They are currently building hotels throughout hoping to create a new economy in tourism for Angola. They will likely be befitting from this though too. It is a difficult balancing act by the Angolan government but the last few years has shown why they need China too. Drops in oil prices had meant Angola were struggling but China could keep them afloat. 2016 has seen a new 100 projects undertaken by Chinese.

Both countries have certainly benefitted from the arrangements, but it is going to take a lot more lifting by China to improve on the workers front before it is viewed just as a success for Angola as it has been for China.