The Chinese Connection
Things to Discuss: Money. Money. Africa?
2009-11-17
By Eric Easter

The White House press releases will say differently, but in this wild imbalanced global economy where America’s mortgage is being held in escrow by Asian bankers, one can only imagine that the agenda of President Obama’s meetings with the Chinese went something like this: Money, Money, Money, Money, Human Rights, Money, Money, More Money, Global Warming, Money, Exports, Money.

That’s probably as it should be. Our current indebtedness to China is more complicated than it even appears. Beyond the nearly one trillion dollars in Treasury bonds supported by the Chinese, there is the staggering level of investment in American real estate, commercial and residential, now being bought at basement bargain rates. While America spent the last eight years enclosing ourselves in a nationalistic bubble, the Chinese globalized in dramatic fashion and the United States was only one of its destinations.

That dynamic puts Mr. Obama in the position of damage controller, negotiating the relatively short term needs of American businesses and financial systems. Unfortunately, that focus on the present may prevent him from engaging China in a more aggressive fashion when it comes to the place that is rapidly become the world’s future – Africa.

In this instance, aggressive means less aggression and battling Chinese influence in Africa with more substantial engagement.

As the United States has approached Africa as largely a military problem and haven for terrorists, the Chinese as a government and as an entrepreneurial class have embraced the continent as an unparalleled growth opportunity that goes beyond oil fields and diamond mines and looks to Africans as a body of potential, highly underserved consumers. In this, the Chinese are beating us at our own game by embracing the spirit of adventure, exploration, immigration and bootstrapping so associated with American success.

In the long term, our lack of access to Africa in a more substantial this could become a larger problem for the United States than our debt load as resources shrink, opportunities dwindle and Africa becomes much more of a strategic priority economically and militarily.

Some amazing statistics:

In 2008, the trade volume between China and Africa exceeded 100 billion U.S. dollars. According to the Forum on Chinese-African Cooperation (FOCAC), “nearly 1,600 Chinese enterprises have started business in African countries with a direct investment 7.8 billion dollars, and their business range from manufacture and construction to agricultural processing and resources development.”

Additionally, the Chinese have conducted a program of debt forgiveness and zero-tariff policies to open up the Chinese market to African textiles and other goods. As its workforce becomes more educated, wired and transportation mobile, Africa will become to China what India was once to England, the fuel that makes it super-powered engine run, literally with oil resources and figuratively with labor, cooperative trade agreements and land holdings.

We have that same opportunity, but after a while it may be too late. A descendant of Africans though he may be, the President represents a nation that steadfastly supported colonial powers and was on the wrong side of history in nearly every conflict.  By taking a military and aid-based approach to the continent, we are staying on the wrong side. President Obama uniquely has the opportunity to rewrite that history if he is willing to battle China toe to toe on this fertile ground, but it will take devising an approach that is centered on empowering Africans and not protecting the global financial interests that power his current agenda in Beijing.