China moves cheap to Africa – Howard French

China is moving part of its manufacturing to Africa, because labor in China has become too expensive, or production is too polluting, says Howard French, author of China’s Second Continent: How a Million Migrants Are Building a New Empire in Africa, in The Herald. This is potentially a great opportunity for Africa.

The Herald:

Howard French, an academic and author of China´s Second Continent, says that rising labour costs at home and the Chinese public´s growing awareness of environmental damage is driving some lower-end manufacturing out of China. These push factors, says Mr. French, make Africa an interesting offshore destination. “It´s already a big deal, and potentially it´s a very big deal.”

Chinese individuals, and Chinese companies such as Haujian, he says, can have a potentially beneficial impacts.

One of Africa´s attractions is that it is largely uncontested territory. “Chinese companies can go and cut their teeth at (low) prices, because the top tier of Western companies is not there. It´s an ideal training ground.”

Mr. French remembers 18 months ago on a drive into Kampala from Uganda´s Entebbe airport, seeing billboard after billboard for Chinese goods. “Mattresses, fridges, wash-dryers, roof tiles – you name it.”

Cheap Chinese products, such as textiles, have often been blamed for wiping out whole swaths of African industry. But Mr. French argues tot the death of inefficient industries selling overpriced goods to unfortunate African consumers is not necessarily to be mourned.

The trick is to harness the new opportunities provided by Chinese interest in the continent, he says. If governments respond with the right incentives , as Ethiopia has tried to do, by encouraging manufacturers to invest locally, transfer technology and employ local staff, China can be more a boon than a threat.