Why did modern nation-states not emerge in China?

This is from Yuhua Wang (highly recommended):

The collapse of the Chinese state in the early twentieth century was surprising. China was a pioneer in state administration: it established one of the world’s most centralized bureaucracies in 221 BCE, two hundred years before the Roman Empire. In the seventh century, it produced a quarter of the world’s GDP (Maddison 2007, 381) and became the first country to use a civil service examination to recruit bureaucrats…

Why, then, did China suffer a dramatic reversal of fortune, given its early bureaucratic development?

… elites’ level of support for state building depends on the geographic span of their social networks. If they must protect a geographically dispersed network, it is more efficient to support state-strengthening policies. These elites have an encompassing interest (Olson 1982, 48). If they need to protect a geographically concentrated network, it is more efficient to rely on private protection and oppose state strengthening. These elites have a narrow interest (Olson 1982, 48).

China…. As the elites’ social networks became localized, they also fragmented; they found it difficult to organize cross regionally. A fragmented elite contributed to a despotic monarchy because it was easier for the ruler to divide and conquer. Historians have noted the shift to imperial despotism during the Song era, as the emperor’s position vis-à-vis his chief advisors was strengthened (Hartwell 1982, 404–405). The trend further deepened when in the late fourteenth century the founding emperor of the Ming Dynasty abolished the entire upper echelon of his central government and concentrated power securely in his own hands (Hucker 1998, 74–75). This explains the increasing security of Chinese rulers [see image].

The despotic monarchy and the narrow interest elite became a self-enforcing equilibrium: the rulers were secure, while the elite used the state to protect their local interests and enjoyed their autonomy. Yet this arrangement led to the gradual decline of the Chinese state.

There are so many parallels to the challenges to state-building in Africa throughout the piece (many of which were documented by Catherine Boone in the excellent Political Topographies of the African State).

Read the whole thing here.

The Nile has apparently not changed course in 30 million years

How old is the Nile?

… It has been suggested that the Nile in its present path is ~6 million years old, whereas others argue that it may have formed much earlier in geological history. Here we present geological evidence and geodynamic model results that suggest that the Nile drainage has been stable for ~30 million years. We suggest that the Nile’s longevity in essentially the same path is sustained by the persistence of a stable topographic gradient, which in turn is controlled by deeper mantle processes. We propose that a large mantle convection cell beneath the Nile region has controlled topography over the last 30 million years, inducing uplift in the Ethiopian–Yemen Dome and subsidence in the Levant Sea and northern Egypt. We conclude that the drainage system of large rivers and their evolution over time can be sustained by a dynamic topographic gradient.

Apparently, an older Nile flowed through Libya, into the Sirte Rift (see image):

nile… we present geological and geophysical arguments supporting the idea that the Nile has been sustained by a mantle ‘conveyor belt’ operating through most of the Tertiary, with a convective upwelling centred under the Ethiopian highlands and a downwelling under the eastern Mediterranean, creating a topographic gradient that supported the Nile’s course over ~30 Myr. Such a course, which is similar to the present-day one, was likely established in the early Oligocene (30 Ma). Before that, our modelling shows that the drainage pattern was probably directed northwestward and controlled by the rifting process occurring in the Gulf of Sirte.

This indicates that at that time, rivers that drained into the Mediterranean Sea flowed farther to the west, possibly along the Sirte Rift that runs from northwest to southeast, which at that time was actively subsiding and being filled with a thick pile of sediments, indicating the activity of a large continental drainage…

Fascinating stuff. Read the whole paper here. (H/T Charles Onyango-Obbo)

As readers of the blog know, Nile waters are currently the subject of a diplomatic struggle between Ethiopia and Egypt. The US government recently offered to help negotiate a settlement. The parties involved set a January 15, 2020 deadline for negotiations. Stay tuned.

Why has economic growth reduced poverty in some African states but failed in others?

This is from an excellent paper by Rumman Khan, Oliver Morrissey and Paul Mosley:

Between 1990 and 2012, for most of the developing world, poverty has halved or more than halved except in sub-Saharan Africa (SSA). The simple poverty headcount fell from about 60% to 15% in East Asia; 50% to 25% in South Asia; 20% to 10% in Latin America; but only from 57% to under 43% in SSA (Beegle, Christiaensen, Dabalen and Gaddis, 2016: 21- 22). This is despite more than a decade of impressive growth in SSA, averaging 5-6 per cent per year since the late 1990s (Devarajan, 2013: S9). Some countries did (almost) halve poverty, such as Ghana (McKay and Osei-Assibey, 2017) and Uganda (Kakande, 2010), and many achieved significant reductions. In contrast, populous countries such as South Africa and Nigeria, on the available evidence, have not achieved significant poverty reduction.

The authors note that the effects of growth on poverty reduction across Africa has been bimodal. And this is their explanation:

povertyTo explain variation within SSA in poverty reduction, we consider aspects of colonial experience associated with the emergence of differing potential for redistributive policies to emerge after independence. Following the approach of Myint (1976) and others, we classify SSA countries into two groups according to the economic strategies used by the colonial authorities, using pre-independence data on factors such as inequality, land ownership by Europeans and political participation by Africans (the process is detailed in Appendix A, with validation by cluster analysis). In smallholder production economies, African agricultural smallholders had economic and some political participation. In contrast, extractive production economies dominated by foreign-owned mines and large-scale farms fostered the emergence of an elite politics characterised by urban bias and capital-intensive production technologies. During the colonial period African economies became clustered around a bimodal structure, which provided better opportunities to the poor in countries whose production was based on the development of labour-intensive smallholder exports than in countries whose growth strategy was based more on capital-intensive mines and large farms. We then test if the growth elasticity of poverty differs between these two groups of countries, using available (PovcalNet) poverty data since 1985, noting that mean growth rates for the two groups were very similar. The analysis shows that the smallholder group significantly outperformed the extractive group, smallholder experience is a significant predictor of poverty reduction, and inclusion of other potential explanatory variables does not alter the conclusion.

I recommend you read the whole paper (including the very rich appendix).

About 12% of ships around the world fly the Liberian flag

This is from The Economist:

Over 4,400 vessels (about 12% of global shipping) fly its flag. And the number is growing.

How did this happen?

The secret of this maritime success is an old practice known as the flag of convenience. In the 1920s shipowners began to register their vessels abroad for a small fee. This allowed them to avoid taxes and labour laws back home. Liberia had few regulations and made it easy to sign up. By the 1960s it had the largest merchant navy in the world.

Read the whole thing here.

Apparently, the government of Liberia makes over $20m a year from its shipping registry.

Two of the “unique advantages” cited on the registry’s website include:

Vessel Construction – The Liberian Registry does not require vessels to be constructed by a particular nation. The supplies for construction and outfitting are also free from similar restrictions. Without this type of protectionism, shipowners are allowed to search and solicit shipbuilders solely on commercial considerations, such as competence, experience, and price.

Vessel Manning – Manning requirements specified by the Liberian Registry are based exclusively on competence, international recognition and safe operation. Many national registries require manning by citizens of the country of registry. This promotes higher wages, inflated labour costs and overheads, excessive bureaucracy, and the potential for interference from organized labour.

The Liberian Registry is headquartered in Dulles, Virginia in the United States.

Since its inception, the Liberian Registry has been operated from the United States. In fact, the U.S. structure and principles governing the Administration of the Liberian Registry are embedded into Liberian law. Pursuant to these statutes, the Registry must be principally operated from the U.S. and managed by international maritime professionals for the benefit of the people of Liberia. The strong U.S. – Liberia alliance provides the Registry with the ability to participate in the international arena with key industry institutions.

People Are Brains, Not Stomachs

Alex Tabarrok over at MR has a fantastic summary of some of the works of this year’s three Nobel Prize winners in Economics. This paragraph on one of Michael Kremer’s papers stood out to me:

My second Kremer paper is Population Growth and Technological Change: One Million B.C. to 1990. An economist examining one million years of the economy! I like to say that there are two views of humanity, people are stomachs or people are brains. In the people are stomachs view, more people means more eaters, more takers, less for everyone else. In the people are brains view, more people means more brains, more ideas, more for everyone else. The people are brains view is my view and Paul Romer’s view (ideas are nonrivalrous). Kremer tests the two views. He shows that over the long run economic growth increased with population growth. People are brains.

Here is the abstract from Kremer’s QJE paper:

The nonrivalry of technology, as modeled in the endogenous growth literature, implies that high population spurs technological change. This paper constructs and empirically tests a model of long-run world population growth combining this implication with the Malthusian assumption that technology limits population. The model predicts that over most of history, the growth rate of population will be proportional to its level. Empirical tests support this prediction and show that historically, among societies with no possibility for technological contact, those with larger initial populations have had faster technological change and population growth.

Read Tabarrok’s entire post here. Highly recommended.

Since Sunday I’ve been asking around if the Prize got any mention on local radio in Busia, Kenya — the cradle of RCTs, if you will, and where Kremer conducted field experiments. No word yet. Will report if I hear anything.

The world’s largest measles outbreak has killed over 4000 people in the DRC

This is astonishing news:

The world’s largest measles outbreak has killed more than 4,000 people in the Democratic Republic of the Congo this year, according to UNICEF.

The agency found that 203,179 measles cases have been reported throughout the country’s 26 provinces since January, according to UNICEF, including 4,096 deaths. Seventy-four percent of infections and nearly 90 percent of deaths have been children under the age of five.

According to the WHO:

  • Even though a safe and cost-effective vaccine is available, in 2017, there were 110 000 measles deaths globally, mostly among children under the age of five.
  • Measles vaccination resulted in a 80% drop in measles deaths between 2000 and 2017 worldwide.
  • In 2017, about 85% of the world’s children received one dose of measles vaccine by their first birthday through routine health services – up from 72% in 2000.
  • During 2000-2017, measles vaccination prevented an estimated 21.1 million deaths making measles vaccine one of the best buys in public health.

The measles outbreak in the DRC is attributable to low immunization rates due to the country’s weak public health infrastructure. According to the UNICEF:

measles.png“We’re facing this alarming situation because millions of Congolese children miss out on routine immunization and lack access to health care when they fall sick,” said Beigbeder. “On top of that, a weak health system, insecurity, community mistrust of vaccines and vaccinators and logistical challenges all contribute to a huge number of unvaccinated children at risk of contracting the disease.”

Two doses of the measles vaccine are recommended and roughly 95 per cent of the population needs to be vaccinated to ensure immunity and prevent outbreaks, according to the World Health Organization.  In DRC, measles immunization coverage was only 57 per cent in 2018.

Emergencies like these are reminders of the unfinished business of state-building in most of the Continent, and not just post-conflict states the DRC.

A Ugandan cartoonist’s take on the country’s relations with China

uganda

The Ugandan president recently leaned on his administration to approve what will arguably be the most expensive road in the world. According to The East African:

In the letter, seen by The EastAfrican, the president directs the minister to stop an on-going procurement process in a move he calls ‘’controlling Uganda’s growing external debt’’ but which technocrats in his government say is likely to deny the country an opportunity to lower the cost of the project.

The road will cost $14.7m per kilometre.

African countries account for over 45.6% of global mobile money activity

This is from Wiza Jalakasi on Medium:

There is nowhere else in the world that moves more money on mobile phones than Sub-Saharan Africa

The region is currently responsible for an astonishing 45.6% of mobile money activity in the world — an estimate of at least $26.8 billion in transaction value in 2018 alone — this figure excludes bank operated solutions.

Mobile money operators like MTN, who also own the mobile network, typically charge in between 0.5–3% for their various digital services, a small price to pay for the convenience and luxury.

The whole thing is worth reading if you want to know about the current state (and future) of mobile money on the Continent.

Africa-China Fact of the Day

This is from the South China Morning Post:

The number of students globally joining Chinese universities surged sixfold in the 15 years to 2018, rising from 77,715 in 2003 to 492,185 last year, according to the Chinese Ministry of Education.

Over the same period, the number of African students in Chinese higher-education institutions increased an astounding fortyfold, jumping from about 1,793 in 2003 to 81,562, last year, according to the Chinese education ministry’s statistics.

With that increase, Africa had the most students in China of any region after Asia, which sent 295,043 students to Chinese universities last year.

Scientists may have discovered the cure for Ebola, trials in the DRC show

This is from the FT:

Two anti-Ebola drugs have proved so effective they will be rolled out to all patients in the Democratic Republic of Congo, raising the prospect of a potential cure for the deadly disease. In a trial conducted since November, more than 90 per cent of patients survived when they were treated early enough with one of the two drugs, scientists said. Under normal circumstances, some 70 per cent of people infected with the virus die. In the latest outbreak in Congo, the second worst in history, some 1,800 people are known to have died out of about 2,800 infected.

The success builds on the lifelong work of a Congolese doctor:

muyembeThe two drugs, called REGN-EB3 and mAb114, attack the Ebola virus with antibodies, preventing the virus from entering cells. They build on a treatment developed by Dr Jean-Jacques Muyembe, director of Congo’s National Institute for Biomedical Research, who has helped lead the fight against Ebola for four decades.

Dr Muyembe, 77, was recently put in charge of the Congo’s response against the Ebola outbreak, which has taken place in the east of the vast central African country where lawlessness and lack of trust in authorities has hampered the response.

Here is Dr. Muyembe-Tamfum’s WHO profile.

Incidentally, Dr. Muyembe-Tamfum “was part of the research team that investigated the first known outbreak of Ebola virus disease in 1976.” He earned his medical degree from the University of Lovanium in Kinshasa (1969), and PhD in virology from the University of Leuven in Belgium (1973). He was appointed dean of the Faculty of Kinshasa University Medical school in 1978.

Here is his Wikipedia page.

And here is another profile in the Lancet from 2015.

On external interventions to improve village-level governance and development: The DRC Edition

This is from an excellent JDE paper by Humphreys, de la Sierra and der Windt:

We study a randomized Community Driven Reconstruction (CDR) intervention that provided two years ofexposure to democratic practices in 1250 villages in eastern Congo. To assess its impact, we examine behavior in a village-level unconditional cash transfer project that distributed $1000 to 457 treatment and control villages. The unconditonal cash transfer provides opportunities to assess whether public funds get captured, what governance practices are employed by villagers and village elites and whether prior exposure to the CDR intervention alters these behaviors. We find no evidence for such effects. The results cast doubt on current attempts to export democratic practices to local communities.

Here’s a description of the program:

Our study takes advantage of a large UK funded CDR program, called “Tuungane,” implemented by the International Rescue Committee andCARE International in 1250 villages throughout eastern Congo. The program had as a central goal to “improve the understanding and practice of democratic governance ….”

… Over a four year period, the program spent $46 million of development aid, reaching approximately 1250 villages and a beneficiary population of approximately 1,780,000 people. A large share of this funding was used for facilitation and indirect costs, with only $16m, 35% of the total program costs, going directly towards infrastructure. These shares reflect the fact that the main focus of the intervention was institutional change, not the use of existing institutions to deploy development funds.

This very cool paper raises important questions about the role of elites in African development (read it to get a better understanding of the futility of these kinds of “democracy promotion”, too).

It might seem logical to assume that short-circuiting elite power, whether at the local or national level, may lead to accelerated development. However, because a lot of “development” is often elite-driven, an explicit agenda of effective elite disempowerment might actually yield suboptimal outcomes. All else equal, elites are often better organized, better-placed to take risks (on account of having more economic slack), better able to protect their property rights, and routinely deploy the state to further advance their economic interests. $46m in the hands of a powerful and secure elite class might yield jobs in firms that provide economic stability for whole districts. It is also true that less powerful or stable elites are likely to squander it on consumption, quick profit schemes, or stash it abroad.

These observations are not unique to African states.

Overall, when I look at most African states, what I see are a lot of very weak elites lacking social power, constantly unable to bend their societies to their will, and resigned to low-equilibrium forms of  political and economic organization (for example, by being mere middlemen in lucrative global commodity markets). In the case of the DRC, this is true whether one looks at Kabila/Tshisekedi or the leaders of armed groups in the east of the country. The same goes for so-called “traditional” leaders. Throughout the country and in the wider region, such elites lack infrastructural power in profound ways. Importantly for economic development, many often lack the ability to protect their own property rights. Our stylized idea of the nature of societal power relations on the Continent needs some updating. Consider this paragraph:

Eastern Congo is a well-suited environment to examine the adoption of democratic practice in local governance. The state has largely with-drawn from the rural areas of the east and enjoys low legitimacy. Local governance is often described as “captured” by traditional chiefs and vulnerable to corrupt practices by state officials. These features are not unique to the Congo. Multiple accounts suggest that in many Sub-Saharan states, colonial rule used pre-colonial institutions to create “decentralized despots” in ways that are detrimental to development.

topographies.jpgAre local elites in the modal African country this powerful? Is this the sense one gets traveling in rural Ghana or Zambia? Do these (mostly) guys look like they are in charge? As the paragraph notes, “traditional leaders” often lack the means to coerce their constituents (the state is largely absent). Despite Mamdani’s persuasive (Rwanda) story, these are not powerful and unchecked “despots” in the standard sense.

At times Africanist scholarship on state/elite society relations can seem schizophrenic: Africa is the land of “imperial” big men elites who can scarcely project their power on account of state weakness (see here, here, and here). Since the early 1990s, a lot of effort has been put into taming the allegedly imperial political elites in the region. Missing in our analyses and in donor programs have been attempts to understand the structural weakness of these same elites and the attendant consequences. The presence of an erratic and parasitic elite class might be the proximate cause of underdevelopment in the region. However, I would argue that a deeper cause is persistent elite weakness in the region. Catherine Boone’s book (see image) is the best I’ve ever read on African elites’ strategies of power projection in a context of state weakness (Boone is easily the most underrated Comparativist of her generation).

The tenures of Africa’s Amins, Mobutus, and Bongos took the form they did in no small part because these were structurally weak leaders (long leadership tenure is not synonymous with state capacity). Throughout their times in office they did all they could to destroy any and all alternative centers of power (including institutions such as legislatures). Their failures reinforced their respective counties’ two publics problems whose legacy is chronic elite weakness that is obvious for all to see. To this day, very few African countries have stable economic elite classes with easily identifiable immovable assets in-country. Most operate like little more than Olsonian roving bandits.

I am yet to see a clear theory that links greater vertical accountability to state/elite capacity. The historical record suggests that democracy works best in contexts with pre-existing state/elite capacity. In my own work, I’ve shown how strong autocratic legislatures beget strong democratic legislatures.

This is not a defense of autocracy. It is a reminder that the processes of state and political development, while related, often run on separate tracks and should therefore be decoupled in programs such as the one above and in our studies.

The Future of Tax Administration?

Low-income states struggle to collect taxes. And with low fiscal capacity comes the inability to spend any money on vital public goods and services. Take Nigeria, Africa’s biggest economy. The country struggles to collect income tax, and heavily relies on revenues from oil (58.1% of revenues in 2018) and indirect taxes. Nigeria also spends precious little on its people. In 2018, general public expenditures added up to a paltry 10.9% of GDP (believe it or not, Nigeria is a libertarian paradise!). In comparison, public expenditures in Kenya amount to about a quarter of GDP. In 2018, income tax accounted for 47.9% of Kenya’s total tax revenue haul.

The demand for public expenditures will only continue to rise as African countries get richer. Overall, government expenditures as a share of GDP tend to rise with income. For instance, in 2017 the expenditures among OECD states ranged from a low of 26% of GDP in Ireland to 56.4% in France. It goes without saying that any future increases in government spending in countries like Nigeria will require ever more efficient means of tax collection. But such moves will likely be hampered by the illegibility of taxpayers.

Enter Russia. According to the FT, Moscow is pioneering real time tax administration:

taxrusStanding in front of a huge video wall, Mikhail Mishustin, head of the tax service, prepares to show off its capabilities. “Where did you stay last night?” he asks. When I reply, his staff zoom in on a map to Hotel Budapest on the screen. “Did you have a coffee?” His staff then click on the food and drink receipts in the hotel from the previous evening. “Look, it sold three cappuccinos, one espresso and a latte. One of those was yours,” Mr Mishustin declares triumphantly. He was right.

This is the future of tax administration — digital, real-time and with no tax returns. The authorities receive the receipts of every transaction in Russia, from St Petersburg to Vladivostok, within 90 seconds. The information has exposed errors, evasion and fraud in the collection of its consumption tax, VAT, which has allowed the government to raise revenues more quickly than general Russian economic performance.

The new system is directed more at shopkeepers than oligarchs. Russia still scores poorly on international league tables of corruption, being ranked only 138 out of 180 on the Transparency International corruption perceptions index, with concerns including cronyism, a lack of independent media and a biased judiciary. But reducing tax evasion among ordinary Russians and highlighting corrupt tax officials have helped raise revenues and clean up the system.

Reasonable people should worry about the potential misuse of these government powers. But remedies to this problem must be tempered with an understanding of the deep structural barriers to poverty alleviation caused by low fiscal capacity (not to mention a weakened fiscal pact between citizens and their governments).

If no taxation without representation is true, then no representation without taxation must also be true.

Finally, as correctly noted in the FT piece, technology cannot fix the problem of tax avoidance by the politically-connected. If Russia’s system catches on in low-income countries, it will most likely be effective in widening the tax base among diffused average taxpayers. The hope then would be that higher levels of tax compliance among average taxpayers will create political pressure for the same from the big fish.

Mosquitoes May Have Killed up to 54 Billion Humans Over 200 Millennia

How about this for perspective:

Mosquitoes are our apex predator, the deadliest hunter of human beings on the planet. A swarming army of 100 trillion or more mosquitoes patrol nearly every inch of the globe, killing about 700,000 people annually. Researchers suggest that mosquitoes may have killed nearly half of the 108 billion humans who have ever lived across our 200,000-year or more existence.

mosquitoThe author of the piece is Timothy C. Winegard, author of the forthcoming book The Mosquito: A Human History of Our Deadliest Predator.

Each year, about 400,000 people die of malaria alone, with another 300,000 dying from other mosquito-borne diseases.

It is worth noting that the failure to eliminate malaria globally is primarily a function of state weakness.

A third of Quakers worldwide are Kenyan

This is in article from 2016:

There are about 300,000 Quakers in the world, and over one-third of them live in Kenya. While the amount of constituents there is growing by the day, numbers in the West (the United Kingdom and United States, in particular) have nosedived in recent years, some 25 percent from 1972 to 2002, according to the Friends World Committee for Consultation.

Kenyan Quakers are just getting started. They’ve seen their yearly meetings grow with the help of evangelism, new churches and services that appeal to a younger, more mainstream Christian crowd. Churches have brought in bands, adopted praise and worship, experimented with vestment and even started evangelizing on the radio and in the street. “We question how things were done traditionally and try to look at things from an African perspective,” says Pastor Khaemba.

The religion has a long history in Kenya. Three American Quakers first arrived on the coast of the country in 1903 before taking the train to Kisumu, a town along the shores of Lake Victoria in the West. Thanks to a good entente with the British government who gave them land and a stable political environment, the Quaker community thrived and began to spread, setting up a number of centers in Nairobi. According to a number of pastors, the reasons for its success lay in an approach that focused on economic development and education, rather than evangelism. Today, there are more Quakers in Kenya than in any other country in the world.

And even within Kenya, Quakers tend to be concentrated in the west of the country on account of the fact that the first missions were established there.

According to this paper, the mission in Kaimosi (Vihiga County) was actually established in 1902:

friendsThe Friends African Mission (FAM) of Quakers, which established a station at Kaimosi in 1902, was quite different from most of the other early missions in Kenya; it was founded and maintained by Americans. The American Friends are evangelical Quakers (they do not follow the silent worship of British or East Coast American Friends) from the mid-west ‘bible belt’, from a background of rural small farmers with strong precepts of self-sufficiency and practicality. From its establishment on 1000 acres of freehold forest land in the reserve, it had an ‘Industrial Mission’ that sought to inculcate the values and practices of the prairie homesteader among its trainees. These values were essentially anti-urban and anti-modernization, but with a strong element of racial superiority, as suggested by Willis Hotchkiss, one of the founders of the Kaimosi mission:

Generally speaking it does not take long sojourn in a town to spoil any Native …. They have added to their original sin a lot of organised sins, not crude savage sins, but cultivated civilised sins …. The general demoralisation is accelerated by the beer hall and the dance parlour …. In the heated atmosphere of these foul dens, so far removed from the open air environments of his savage games, his life is cankered to the core …. Added to all these devastating effects which have suddenly crashed into his life there is the moving picture show. Hollywood has poured a lecherous stream of filth into the world, and these child races have been quick to appreciate it. [Hotchkiss was writing in 1937].

The paper documents the manner in which Quaker missionaries (despite their abhorrent views of their congregants) were pioneers of technical education in Kenya. The anti-urban posture, coupled with their lukewarm approach to regular education, might explain the American Quakers’ limited success at conversion in the wider Lake Basin region (at least in comparison with the Catholics in Yala or the Church Mission Society in Maseno).

A good read on potential US responses to ever-deepening Africa-China relations

This is from Aubrey Hruby, one of the sharpest minds on Africa-US business relations:

For American companies to compete properly in African markets, the administration needs to take a broader look at capital flows into African markets and the diversifying forms of Chinese commercial engagement. This report argues for a broadening of the competitive lens beyond infrastructure and seeks to provide a more comprehensive framework for examining China’s commercial interests in Africa. It presents two models through which policy makers can understand recent developments in the region. The first describes the G2G nature of Chinese infrastructure financing, summarizing the mechanisms by which Chinese state-owned enterprises typically secure contracts, and contrasts it with the government-to-business (G2B) structure of US development finance. Secondly, the brief analyzes US investment in African markets across capital flows, and notes the rising competition from Chinese firms in each category.

Read the whole thing here.

Here is Hruby talking with Eric & Cobus on The China in Africa Podcast.