TSG IntelBrief: Rising Sinophobia in Africa
July 31, 2013

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Blunder in Ghana

As of late July 2013, the crackdown on illicit gold mining in Ghana that began in June has thus far resulted in the arrest of 571 Chinese nationals who are accused of illegally working in the sector. In addition, 4,592 Chinese workers have returned to China, some the result of involuntary deportation but many out of fear of violence in the face of rising hostility from the local population, especially after Ghanaian authorities allegedly stormed Chinese compounds in search of illegal miners.

Even before the raids, China's footprint was weighing heavily on the local economy: Ghanaians have accused Chinese miners of unlawfully seizing jobs, polluting community water supplies, and disturbing agricultural production through their operations. Further exacerbating the scenario, a sixteen-year old illegal Chinese miner was shot a year ago while trying to evade arrest, an event that led Chinese miners to subsequently begin arming themselves with rifles. Public relations in Ghana have become such a sore point for Beijing that Xuejun Qiu, a director in the Chinese Ministry of Foreign Affairs, felt the need to publicly comment, stating, "This issue of illegal mining is a disharmony in the bilateral relations but we should always have the bigger picture in mind."

Sinophobia Rising

Chinese-African friction is not limited to Ghana. Last year, President Jacob Zuma of South Africa described the pattern of Chinese trade with Africa as "unsustainable in the long term," and early this year, President Ian Khama of Botswana remarked on his "bad experiences with Chinese companies" in his country, emphasizing that his government "will be looking very carefully at any company that originates from China in providing construction services of any nature."

Lesotho and Malawi have both implemented policies that either restrict foreigners from obtaining small business permits altogether, or limits their area of operation to urban centers. Zambia is perhaps the starkest example: in August 2012, Lusaka reclaimed a lucrative copper mine from its Chinese owners after hundreds of Zambian workers rioted (during which a Chinese supervisor was crushed with a coal trolley). Zambia is now in the process of implementing an electronic reporting system that will force foreign investors—who are uniformly suspected of tax evasion—to pay their royalties. In less well-regulated countries like Lesotho, where government corruption has facilitated the illegal acquisition of business licenses or identification documents by Chinese migrants, the situation is even more volatile.

According to a recent Pew Research Center survey of six African countries (Ghana, Kenya, Nigeria, Senegal, South Africa, and Uganda), China's average favorability has dropped four percentage points (from 72 to 68 percent) since 2007. While not a huge margin, it nonetheless contrasts with an increase in the United States' average favorability rating that rose five points in the same period (from 72 to 77 percent). This suggests that the US retains a strong soft power advantage despite—or perhaps because of—China's expanding economic engagement with Africa.

China's Response

Beijing is taking its Africa problem seriously, and is addressing the issue in the way it knows best: through the media and educational outlets. China Central Television moved onto the continent this year, establishing its first international broadcasting headquarters in Nairobi, Kenya, and China has apparently also bankrolled a stake in South Africa's primary outlet, Independent News and Media. Xinhua News Agency, which is solely owned by the Chinese government, is now Africa's largest wire service, and "Confucius Institutes" that promote Chinese language and culture now proliferate throughout Africa. Whether or not the media onslaught will repair China's image in Africa remains to be seen.

Winning by Design or Default

Chinese economic engagement with Africa has far outstripped the United States' activities on the continent. The limited presence of US small- and medium-sized enterprises has obviously limited the potential for friction between American and African entrepreneurs. But the tensions surrounding the presence of Chinese workers in Africa—who archetypically go to Africa just to turn a profit and leave—does highlight the wisdom of certain longstanding US soft power programs. Since 1961, for example, the US Peace Corps program has deployed the bulk of its 210,000 volunteers to Africa primarily for the purpose of building goodwill.

The Obama administration is currently attempting to leverage the social capital that these volunteers and various foreign aid programs have built over the years. It has also recently unveiled the "Power Africa" initiative, which will bolster the energy infrastructure for African entrepreneurs and will be seeking the renewal of trade-friendly legislation like the African Growth and Opportunity Act.

Whether such programs will translate into a coherent competitive advantage for American firms remains uncertain on a continent where uncertainty abounds.

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