These Geography A-Level notes on Economic Transition provide a detailed list of the advantages and disadvantages of Chinese Foreign Direct Investment (FDI) in Africa. The document analyses the economic, social, and environmental impacts, offering a balanced perspective on the benefits and challenge...
Chinese FDI in Africa
Advantages Disadvantages
As the African economies grow, poverty will The Chinese have shown a lack of judgement in
decrease as the average wage rises and the terms of the countries they invest in, entering
overall quality of life will increase. countries that are less developed and
democratic than would be acceptable for the
US or other Western countries.
A massive contribution by Chinese investors It seems that the driving factor for Chinese
was the building of the $200 million investment in Africa seems to the prospects of
headquarters of the African Union which aims Chinese economic gains. This can be seen as
to promote peace, security, and stability on the they are looking for the opportunity to extract
continent. raw materials.
China is also making investments in industry all Many Chinese investments involve the use of
over the continent from running mining extensive Chinese labour, which creates
operations to managing oil firms. problems such as lack of housing, local
unemployment, and social tensions.
Another benefit to Chinese investment in Whilst the specifics of Chinese investments are
Africa, are improvements to infrastructure, unknown it is known that the investors have
such as transportation networks, and other not shown respect for human rights.
economic development.
As the African countries GDP increases the Chinese businesses are trying to sell
population will become better educated and manufactured products to the African market,
health care will improve increasing life in a way that somewhat resembles Africa’s
expectancy and reducing infant mortality rate. colonial past (neo-colonialism)
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