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China in Africa: The Real Story

USA and Chinese Engagement in Africa: GAO Study

Deborah Brautigam

A team at the US Government Accountability Office (GAO) has just released a long-awaited study comparing US and Chinese export financing (and development finance more broadly) in Africa, based on detailed case studies of three countries, Angola, Kenya, and Ghana.

I read it late last night and this morning. It is, quite simply, by far the best single analysis I have seen on China-Africa-US engagement in Africa. It is comprehensive, empirical, deep and broad, careful, and balanced. Readers of this blog will expect that I read it carefully. I did, and I'm almost surprised to find that I have nothing but applause for their work. A few highlights:
  • Evidence from our Department of Commerce point out that European firms, not Chinese, are our main competitors for host-country government contracts in the three countries covered by the study. 
  • Compared with the Chinese Eximbank, which supports its companies enthusiastically in the three case study countries, the U.S. Ex-Im has only provided a total of two loans to governments in the case study countries since 2001 (both to Ghana)
  • "Chinese firms are innovating and adapting quickly to local markets, such as in Kenya, where a Chinese firm in this [telecoms] sector has established one of Kenya’s largest training centers."
  • "Counterfeit goods and related products from China have adversely affected U.S. firms’ sales and reputation, especially in Kenya among our case-study countries."
  • "The Angolan government’s requirement that foreign firms take local firms as partners has posed some challenges for U.S. firms, while the Ghanaian and Kenyan governments’ strict requirements that foreign firms hire local workers have resulted in Chinese firms’ hiring more local workers for construction projects in these countries."
  • "China’s data also include data on the number of Chinese laborers in Africa and a few African countries, including Angola. The United States does not have comparable data on U.S. workers in Africa and in countries like Angola."
There is a lot more of interest in this study. The team first contacted me for an interview in April 2011, so they have been working on this for quite some time. Although I had some (infrequent) interaction with them, I admit that I approached the final report with some trepidation. I've seen some pretty awful "research" on China-Africa sponsored by other US government agencies, and error-filled studies done by researchers at the World Bank. But as citizens and taxpayers, we ought to be pleased by this careful account. I hope it gets the attention it deserves.