Economic Development in Sub-Saharan Africa: Impact of the Chinese Investment on Trade, Agriculture and Infrastructure in Ethiopia and Kenya

摘要

The growing presence of China in Africa has had both positive and negative impacts on the continent and its nations. As Chinese State Owned Enterprises (SOEs) are contributing to increase the economic development of 50 African states mostly throughout investments, the Chinese government's politic towards Africa has strengthened with its continuous development aid and grants in exchange of the exploitation and exploration of the continent's natural resources. However, with countries such as Ethiopia and Kenya lacking on natural resources, imports and exports on trade, agriculture and infrastructure cooperation grew rather modestly since 1970. As a result, China is arguably both countries' most important bilateral economic partner. Saddled on a spirited economic expansion towards enhancing self-reliance capability of African countries, China's growth in Africa has stroke the chord to the world's attention and stunned allies and opponents alike. While, friends perceive this alliance as a lucrative opportunity for both sides, critics are skeptical over the cooperation pointing out the potential impact of China's development aids towards enhancing the recipient countries self-reliance capabilities. As a matter of fact, issues such as the continuous utilization of Chinese labor and input during the implementation of such projects, and the lack of fair competitiveness on African markets have had many questioned the sincerity of China's intensions, in one hand, towards attaining mutual benefit and enhancing self-reliance with these recipient countries. China's drive to expand its political power and stature along its economic power, and African leaders' desire for economic progress are within what is defined as a realistic framework. On the other hand, a constructivist perspective centers on ideas in terms of shaping the actions of States, the opinions of state leaders, the media academics and mass public likewise.;Unlike Nigeria, Angola, or the Democratic Republic of Congo, both Ethiopia and Kenya have very few natural resources that would have made their cooperation with China either realistic or materialistic. But interestingly enough, their alliances with Chinese investors happen to be as important as it is with other nations for several other reasons. As the second most populous country in Africa, with a population of about 90 million people, following Nigeria, Ethiopia offers several economic, social and environmental indicators favorable for investment both in short and long terms. Its structural indicator embedded the multiple headquarters and institutions that dominate Addis Ababa for various international institutions such as the African Union (AU), the African Development Bank (AfDB), Food and Agriculture Organization (FAO) etc. As a matter of fact, the African Union was built with a grant assistance of US $200 million provided by China, which came up with a traditional Chinese style garden (Zander and Huang 2017, 12). Moreover, the partnership for Africa's development, supported by China was established in Addis Ababa and the United Nations Economic Commission for Africa has its headquarters in the capital city as well. It also is important to point out that though the country is ruled under a dictatorship regime, it is arguably considered as offering a stable political and economic environment with a liberalized economy in all major sectors and significant tax incentives.;Similarly to a much higher extent, critics contend that Kenya is widely regarded as an African example of a politically stable society, in which there is a broad participation in an expanding economy (WTO). Although the balance of power between competing interests within the one party framework often has been tenuous, Kenya offers a much attractive environment for foreign investment. Indeed, with one of the region's best performing currency, the country has a higher per capita Gross Domestic Product (GDP) in the region with US$63.49 billion in 2015 compared to Ethiopia's US $61.54 billion in 2015 (KNBS). Moreover, it has high social and structural indicators such as its population growth rate, educational attainment, life expectancy etc. Furthermore, unlike Ethiopia, it is a more open and liberal society with a multiparty-system versus a one party dominant system that reinforce the steadiness of its political environment. Indeed, the new constitution promulgated in 2010 has gone a long way in enhancing political stability with the separation of powers in the country. Moreover, Kenya's geographical location is strategic for investors aiming to access the East and Central African market that offer over 385 million consumers. In addition to that, regulatory reforms were instituted to simplify, make transparent and minimize the number of licensing requirements for investment. (Abstract shortened by ProQuest.).