Mr Isaac Demuyakor, PhD, a keen observer of the Africa-China activities with additional interest in trade and value addition, has stated in clear terms that Africa is not ready to achieve a trade balance with China anytime soon.
Speaking on what Africans can do to ensure a balanced trade with China, Mr Isaac Demuyakor said Africa, unfortunately, cannot obtain that status right now. He said while Africa is endowed with resources and huge potential, the continent has more work to do to position itself towards ensuring trade balance.
Key among the things he said Africa needs if it should obtain a trade balance is a stable power supply. He said Africa depends on the extractive industry because the continent is struggling to provide enough power to meet the energy needs of its people and feed industries. According to him, while the majority of Africa’s power generation is from expensive sources such as thermal, China has the majority of its energy coming from nuclear sources making theirs cheaper and conducive for factories to thrive.
Though Mr Demuyakor has a keen interest in value addition, he said Africa will struggle to add value to its raw materials so that it can earn more from them. He said the insufficient power available to factories means industries pay more to produce which impacts the price they will sell. China, he said has cheaper power supply options for industries meaning factories can sell their final products at a lower price due to the lower production cost. To him, that alone is an advantage Chinese products have even in African markets against locally produced goods which are expensive due to high production costs.
He noted that Africa will need an infrastructure drive to create an enabling environment for businesses to operate efficiently and at lower costs to stand a chance of attaining trade balance with China.
Also, Isaac Demuyakor said the human resource Africa needs to ensure it attains trade balance is not there. By human resource he said, the mindset of Africans to work towards trade balance is almost non-existent in this regard due to many factors.
“The human resource; skilled labour is something that is required. It would be very difficult for Africa to get there because to mindset to get there is not there. We don’t even have the required infrastructure to even do that. So, when we talk about balance, it would be very difficult,” he explained
One of the factors he says affects the mindset is the political game Africa plays with the West and China. According to him, with the emergence of China, Africa now feels there are two sources from which it can benefit. With that feeling and mindset, instead of focusing on self, Africa continually looks to both the West and China for help and if one does not give, the other would because of geopolitical favours.
Explaining further, he said while Africa can work on itself to provide for its own needs, the majority of the continent’s leaders constantly think about political power over the economic freedom of their people. And because of the innate desire for power, they see the West and China as easy options to secure help to please the people in Africa. That he said is what leads most African leaders to seek help from China and the West. It is aimed at securing these leaders and keeping them in office for as long as they desire.
Explaining how Africa can move beyond the stage of being a supplier of raw materials in global trade, he said there needs to be a conscious policy to drive the interest of Africans. Mr Demuyakor noted unless such a decision is made by Africans to focus on what the continent has and maximize its potential, it will continue to rely on what is cheap yet very expensive.
“Africa has looked to the West for a very long time. Instead of we Africans taking the bull by the horns and say that we can do it by ourselves, China is now up and we are looking towards China. We are not saying we are looking towards ourselves; we’re looking towards China,” he said on The Conversation.
According to Mr Demuyakor, “When you have two sides and you can go to [for help], you will not even think about yourself again because it is easier to for you to get something from these people so that you can get power. Because it is all about political power, what can I give my citizens to get this political power? So, I can easily go and take from the West and take from the East and make my people happy.
“So, it will be very difficult for Africa to add value unless we have leadership that is willing and we have citizens that are waiting to make sure that that [value is added] happens… It will be very difficult for us to say we are adding value to the things we have,” he concluded.
The Conversation is a monthly programme by Africansonchina where thought leaders, experts and industry players are given the chance to share their thoughts and views about certain topics in the Africa-China space. Previous episodes can be found on our YouTube channel while all stories that emanated from those discussions are available on our website. If you are in the Africa-China space and wish to make an appearance, you can reach out to us via editor@africansonchina.com stating your expertise or interest areas.
