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Opinion: Chinese investment in Africa

By , IT in government editor
Africa , 23 Apr 2015

Opinion: Chinese investment in Africa

We continue to see headlines that reflect ongoing investment by China's government and its private sector in Africa, and more often than not the narrative is peppered with negativity.

The country's government and companies have over the last couple of years been investing heavily in the development of the African continent.

Investments on the continent range from rail and road construction, telecoms and ICT services, and contribution to education to name a few. Chinese telecoms heavyweights Huawei Technologies and ZTE are believed to have business operations in more than 50 African countries.

Chinese companies saw an opportunity, took the risk and it is paying off. However, the sentiment often at the forefront is how Africa is being 'exploited' for its resources.

This is where I have my reservations ...

Don't get me wrong I am by no means advocating any country's way of regulation, but what I am saying is that maybe Africa could learn from the Chinese way of doing business.

Why do I say this?

I'm currently visiting Shenzhen, one of China's most successful Special Economic Zones (SEZs), and I'm amazed by the development I have seen.

What was once a fishing village and home to some 300,000 Chinese citizens is now a bustling city with high rise buildings, businesses and a population of 15 million people.

Locals say Shenzhen is China's business district with a young and vibrant population. The average age of the population is between 28 and 30.

Shenzhen is also home to several Chinese high-tech companies such as Huawei, Tencent, and ZTE. The city has been dubbed China's capital technology hub.

Just to give you an idea - Huawei is China's largest telecom equipment manufacturer and networks solutions provider.

All of the growth exhibited in Shenzhen, the Chinese government achieved in less than 35 years; this is the same age of the many democracies in Africa.

Roland Sladek, vice president of international media affairs at Huawei told ITWeb Africa that Huawei and other organisations believe there is correlation between GDP growth and broadband penetration to develop economies.

The more economies are connected the more businesses can do business of the internet and help boost the economy. We believe there is a strong need for that in Africa.

"In some countries we have been there for more than 15 years... We have a historically strong footprint in Africa and we are building 70-80% of the 4G networks in Africa and this gives us strong credibility to build tomorrow's networks in Africa.

He added, "I think there is still a lot to do currently there are less than 30 commercial LTE networks in all of Africa and this is not huge. I think there needs to be much more."

Sladek explained that mature markets like Kenya, Nigeria and South Africa can be leaders that showcase economic growth through ICT for the continent.

Personally I'm encouraged by the historical growth story of Shenzhen because I think African nations can draw parallels from just this one city's achievements.

Africa's potential exists. Which other continent presents so much business opportunity?

Therefore, investments by Chinese government and the private sector should be viewed as a partnership that could be mutually beneficial.

Imagine the potential of South Africa's economy, employment prospects, and development for example if a similar principle could be adopted to drive Johannesburg, the country's economic hub.

My two cents: instead of first adopting a negative approach to the Chinese way of doing business maybe it's time we learn a thing or two about their drive and determination.

That way I believe we could see faster development on the continent, provide economic opportunities for the people and be able to compete with large economies like China and the United States.

* Simnikiwe is in Shenzhen, China for the 2015 Huawei Global Analyst Summit.

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