Friday, July 06, 2007

Millennial Challenge: Is Chinese Monopoly in Africa- blessing in disguise?

Dear Patriotic Global Citizens and Friends of Africa.

Re: China Rising in Africa- A blessing in disguise or dangerous neo-colonialism

The Chinese are here to stay. They are competitive, cheap and rather humble in getting things done without strings attached is the common description of the Silent Take Over of Africa and African Interest.

The EU and USA are opting out as they are busy fighting the Arabs and Muslims on all fronts and are forgetting the most important task that is competitiveness in the marekt arena in Africa.

I was fortunate to meet the then New American Ambassador to African Union at the reception held in her honor as the First Female AU Ambassador from the USA at the Ethiopian Embassy in Washington,DC.

After speeches and introductions, I had the opportunity to share with her one on one, about my concern about the delayed US recognition of the impact of AU in the world scene. At the time, I believe it is some 6 months or so ago, on the eve of her trip to Addis to take up her new post, the New Ambassador was rather detached and felt it was my duty to interest Africa to vet for US businesses and interests. At least that is how I felt at the time. The question then and now, ..."Is the Dominance of Chinese Expansion in Africa a concern to the US" ? and would she take on this challege as the new US Ambassador to African Union.

The response was rather interesting. This is Africa's problem not that of US. The Ambassador emphasized that the US spend effort on education, enterprises and empowerment of the local people, while the Chinese are busy on doing things for you on the cheap and eventually taking over the market and opportunity in Africa making all Africans passive consumers. Similar to what is happening in African American communities here in the US where the Asian do all the business and the locals are mere consumers. I wondered if Africa could turn into a consumer society with no skills and competency for the competitive market, if every thing is done by the Asians or the Chinese to be exact? I still wonder when I try to see 100 or one millennium years in my expansive imaginative vision and worry a lot!

I just could not get though to her that this is not an African problem alone as the United States has a great stake too. I remeber clearly that she the US rempresentative at African Union did not see it to be the concern of the United States. I wonder if she has changed now after almost 6 months on the ground and the Chinese expansion taking off and scaring even the local Ethiopian Business community as this report indicates.

With the attached rather interesting information coming from the Ethiopian Business Community, I wonder if the concern should be that of the Ethiopian Government rather than the US and for that matter, EU or ASEAN countries. Does government have any say when it is revolutionary, as it claims to be in Ethiopia. I wonder if the revolutin stopped at the outskirts of Addis as all the revolutionary leaders are being indicted in court for corruption, the then Prime Minister and Defense Minister just got sentences this week after almost 16 years. The Justice Department should be on snail speed intodays light speed communication world. I some times wonder whether the judgement takes place as you are already in jail 'Guilty unless one can prove otherwise!

I am also amazed by how the African Business people in this report feel they are in a hostage situation as they are not able to compete in the free market. Is this fair complaint of monopoly or an excuse for sloppy business practice. The jury is out, and the Chinese will succeed as they have already done here in the US with Billion Trade in ballance against the US. What will stop them in Africa. Competition? Never!

So, I say, Viva China, you work hard, bring down the price to the level the common person can afford, who cares about the Incompetent local business people or the Sleeping Giant, USA who is not savy enough to compete foot on foot with the Chinese.

May be as the Mortgage Bank Commerical have it in one of their advertisement, USA, EU, ASEAN and African Business people, please compete and African Consumers will root for you if you are competitive and affordable.

Good bye African and US businessmen the Chinese are here to stay!

Please read on this interesting article by none other Ambassadr David Shin a one time US Ambassador to Ethiopia who happened to be also the Horn of Africa Coordinator during the 1991 US-Somalia Fiasco- The Black Hawk Down Experience of the then incompetent Clinton Administration towards Africa.

I trust, President Bush will be as smart on the Business with Africa as he has proved with AID to Africa where he proposed to spend $30 Billion compared to President Clinton $1 or $1 million. Just see who is talking the talk and who is walking it- the smart Democrats or the Progressive Repulicans as far as Africa is concerned, bring on the Repulicans, please all the time!

with regards

Dr Belai

David Shinn

Member of the private business community on Thursday expressed concern on the need for some sort of intervention by the western economic powers to redyce the market dominance of the Chinese products in Ethiopia.

At a half-day discussion forum held at the Chamber of Commerce and Sectoral Association's (CCSA) the private enterprises voiced this concern on the growing overtaking of the domestic market by Chinese-owned firms and their cheap products. The enterprises underscored the adverse impacts of the extremely free markets in the country by citing the case of the law quality imitated and cheap products which are imported from China under cutting the locally produced ones.

Products produced from fake and cheap materials in China and imported to Ethiopia are saturating the market at the moment and as direct result of this home-made products have been thrown out of competition. Owners of the enterprises said that a growing number of private businesses are closing down as a result of the unfair competition dominating the market.

The discussion which touched on the preliminary findings of the research on sino-African relationships presented by Ambassador David Shinn, former American Ambassador to Ethiopia, elaborated on the practical difficulties that local firms faced with Chinese penetration of the domestic markets in Ethiopia. In addition to the undercut prices, the Chinese firms have devised a scheme to penetrate those areas of investment set aside only for the local companies. Printing, Insurance and banking are among those which are cited by enterprises, demarcated only for local firms.

However, the Chinese business men managed to enter these sectors through partnership with local firms. Such partnerships, according to the discussion participants, are not true since they are based on unbalanced and unfair grounds, thereby all the benefits accruing to the powerfull ones - the Chinese companies. So, they said western powers should intervene to save private business activity which are under threat in Ethiopia.

On the other hand, some of the participants listed some principal factors that forced Africa countries to turn their face to the East. proponents of this view basically point out the deep involvement of the West on the issues like terrorism made it easier for China to be open to trade with Africa, irrespective of the internal political realities.

The research on its part pointed out some key facts with regard to Sino-Africa relationships. To start with, China has diplomatic relation with forty-eight countries in the continent and such bilateral relationships are also strengthening from time to time through visits of Chinese officials to Africa. Furthermore, when issues of trade are in focus last year alone the value of trade exchange between China and Africa amounted to fifty-five billion dollars, while in 2010 the figure is expected to surpass hundred billion dollars.

With respect to the political interest of China in African countries, it can be understood that both China and Africa have been criticized for human right violations. So China is basically seeking the vote of the Africa countries in the human right committee. It is a sort of I-scratch- your-back-and-you-scratch-mine policy where the non-interference in the internal affairs of each other remains to be central in the relationships.

However, the research noted that the Chinese have one clear-cut policy (foreign policy) when it comes to Taiwan. If there is to be a meaningful relationship with China, recognizing only one China is an important factor.

By Asrat Seyoum

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