You are here
Home > Global Affairs > China Battles France for Business in Former African Colonies

China Battles France for Business in Former African Colonies

Social media sharing

China Battles France for Business in Former African Colonies

Pauline Bax. and

Olivier Monnier

Fast-growing economies of Ivory Coast, Senegal lure Chinese

Chinese loans to Ivory Coast rise 1,400 percent in 2010-2015

When Ivory Coast put out a tender to build a bridge over the lagoon in its commercial hub of Abidjan, 10 out of the 18 companies that expressed interest were either Chinese firms or in partnership with them. China State Construction Engineering Corp. won the contract in May.

The 109 billion CFA francs ($191 million) deal highlighted China’s growing muscle in a part of Africa that until recently its business people showed little interest in: the French-speaking west. The area’s fast-growing economies have seen a spectacular rise in loans from China, with its companies competing with firms from France for big infrastructure projects.

“They used to think that the French controlled everything,” said Dominique Banny, director of corporate and investment banking at Stanbic Bank, a subsidiary of Standard Bank, Africa’s biggest lender by assets. “Now, we see more and more Chinese companies scouting for projects in French-speaking Africa, with delegations arriving every two months.”

Loans from China to Ivory Coast surged in the first five years of this decade 1,400 percent to a total of $2.5 billion and 1,268 percent to Senegal reaching almost $1.4 billion, according to data compiled by the China Africa Research Initiative at the Johns Hopkins University in Washington D.C., in 2015, the most recent year for which data is available.

End of Conflict

While Chinese companies are also working in former French colonies such as Mali, Niger and Togo, their main focus in the region now is Ivory Coast. It initially missed out on China’s investment boom in Africa because of a violent political conflict that ended in 2011. Now, it’s catching up as the government focuses on infrastructure and energy projects to boost a $40 billion economy that’s expanded an average 8 percent per year since 2012.

And as the Chinese come, West African officials and engineers are doing their homework. They’ve followed the experience of big-ticket investment destinations such as Angola, where Chinese companies have been criticized for using their own workers and supplies almost exclusively to complete projects and providing little opportunity for local employment and businesses.

When Ivory Coast awarded a $580 million contract for one of President Alassane Ouattara’s flagship projects and its first hydropower dam in decades to China’s state-run Sinohydro Corp., the authorities set conditions: the working language was to be French, only 20 percent of the workforce could be Chinese and building material such as cement had to be purchased locally.

“We made sure we made our demands clear from the start,” Maxime Balet, the 42-year-old project head at the Soubre dam, said as he stood near the towering trash rake that removes water hyacinths. “We went to see similar projects in Africa to collect information about the way Chinese companies work and on the issues that could arise.”

There have been difficult moments. Ivorian engineers had to sometimes interpret gestures and facial expressions to figure out what their Chinese counterparts were saying, Balet said. Even today, the Chinese and Ivorian employees have separate canteens, and after sunset it’s rare for a Chinese worker to be seen in the neon-lit bar on the staff compound.

Completed ahead of schedule, the Soubre dam is a huge source of pride for the engineers who are preparing to take over operations from the handful of Chinese still at the site. The 4-kilometer (2.5 mile) dam, the country’s largest, has added 275 megawatts to the national power grid and will cement Ivory Coast’s rank as the region’s main electricity exporter. The Export-Import Bank of China provided 85 percent of the funding, with the Ivorian state contributing the rest.

“It was a fantastic opportunity for us to learn new skills in different areas, from geology to hydraulics,” Balet said.

A worker monitors equipment in the control room at the Soubre dam.

Photographer: Pauline Bax/Bloomberg

The deepening involvement in Ivory Coast and the rest of the region marks a key step in China’s expanding footprint in the continent that ranges from offering scholarships to African academics to contributing Chinese peacekeepers to United Nations missions in South Sudan and Mali.

Africa is also part of the “Belt and Road Initiative” that calls for half a trillion dollars in investment in infrastructure along trade routes to China, which is expected to overtake the U.S. as the world’s largest economy before 2030.

“It’s the first project for us in Ivory Coast,” said Sinohydro’s deputy executive director on the project, Wang Xianping, through a Chinese interpreter. “We tried to get familiar with the country from the project. We hope we can take on more projects but it depends on some things, including funding.” Work on a smaller, second dam nearby has already started, even though the formal contract hasn’t been signed yet. At least two more dams may follow.


Social media sharing

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Top