The China Brand

Unlike most companies investing in Africa, Chinese companies are inextricable from their country of origin. The successes and failures of Chinese companies are generally reported as being those of China itself as if Beijing had direct control over all Chinese businesses in Africa.

For the Chinese government the China brand is important in different ways in different markets. Initially in Africa Chinese policy makers were not overly worried by the way China was perceived. The nature of their large investments and the less fashionable investment environments in which they operated meant that few active efforts were made to change perception.

At the same time China’s brand has to be robust to challenges from other major economies and at home. The narrative of South-South cooperation and non-interference in domestic policies has been very successful in pariah markets such as Zimbabwe and Sudan, but less so in larger markets. While small Chinese companies often cause trouble for the Chinese state, Beijing is unwilling to disown them for fear of admitting that the state is not in absolute control. This perhaps explains the ubiquitous ‘China Inc.’ concept whereby all the country’s actions are considered as contributing to a single entity.

Many commentators assume that all Chinese investments relate to an overarching Africa strategy managed by party members in Beijing. This mistake is not corrected by Beijing despite its effects on China’s reputation. Earlier in the year this blog commented on the lack of management from Chinese state entities of the Collum Coal mine incident in Zambia. African workers were fired upon by their Chinese supervisors causing uproar in Zambia. The company running the mine was a small family run operation, but Chinese officials in Zambia were not forthcoming in defending or condemning the actions. This basic public relations exercise would be the first thought of a Western embassy experiencing the same scenario.

Gradually a perception of poor quality in China’s engagement has grown up in Africa, brought about by reaction to low cost Chinese consumables, especially counterfeit goods. However this is also brought about by effective pricing. Chinese telecommunications giants Huawei and ZTE have experienced enormous growth in Africa, but both have pursued different strategies. Both can offer far lower cost alternatives to their rivals, but Huawei prices its services higher than ZTE’s in order to avoid a perception of poor quality.

This poor quality perception has however spread to China’s wider relationships, and African governments although wooed by Chinese wealth and support often consider Chinese investment to be inferior. This has manifested itself in the media with concerns that Chinese companies dump goods on African markets, and that their labour practices are inhumane. In some cases they are, but China’s overarching brand means that the careless actions of small and economically insignificant companies can have a large effect on state level negotiations governing Beijing’s strategic priorities.

This may be the cause of the Ugandan government’s decision to block a US$74 million loan from the Import and Export Bank of China (EXIM) meant for a digital migration project. Last year, Huawei Technologies faced controversy over its tender for fibre-optic cabling in Uganda. The $106 million project was also funded by a loan from EXIM Bank of China. Huawei is accused of inflating the cost of the contract in addition to flouting procurement procedures.

China’s brand is associated with a great many different things, and managing the perception of this brand is increasingly vital to China’s success. As China moves into more mainstream markets, governments have choice over who will invest. China has struggled to compete in new oil markets like Ghana, Uganda and Nigeria where western multinationals are active.

In response China's soft power has been in force with regular announcements of impressive investments in the media, and increasingly an attempt to deal with aspects of its poor reputation head on. The Forum for China Africa Cooperation has been particularly active in promoting a Chinese take on African affairs.

In competition with this brand European and US governments have sought to discredit China’s involvement. There were three instances of this attempt in recent months. British Prime Minister David Cameron was guilty of the most blatant attempt in his claims that China is invading Africa. The response last week from a Chinese academic points out both the increased media scrutiny of the veracity of these statements, and also the hypocrisy in Western power’s accusations of invasion or colonialism in order to maintain their own trade relationships.

This was also recently apparent with Hilary Clinton’s tour of Africa when she hinted that China's involvement was neo-colonial, or recent claims by the German government’s African advisor that China was responsible for land grabs. This was not supported by the recent Oakland Report (HT Deborah Brautigam).

Increasingly Chinese media is defending itself on these accusations. This week the Chinese Foreign Ministry issued a rebuttal of these allegations pointing to the lack of evidence for Chinese land grabs, and the extensive agricultural aid which China enacts in Africa. This increased media engagement with both Chinese and international media is evidence of Beijing’s intention to improve China’s brand.

China’s response has been slow, but is increasingly becoming clearer. The Chinese government has begun to fund programs which seem aimed at improving perception of Chinese businesses. An example this week comes in the form of the China Africa Industrial Forum (CAIF), launched on July 20th in Beijing. It aims to represent Chinese businesses, listing key Chinese companies investing in Africa. The organisation gives awards for the best Chinese businesses operating in Africa, in order to signpost companies which Beijing wants associated with the China brand.

This follows other projects aimed at improving perception. For example China has announced agreements earlier this year with the Ugandan and Nigerian government to help stop Chinese counterfeit goods from entering the countries. Although this response might appear to be a public relations exercise, the recognition of African complaints about Chinese investment is a vital step in improving outcomes for African people.

Although the China brand is a fallacy in terms of Beijing’s control, it has been a powerful tool in China’s rise in Africa. The mud throwing that has emanated from places such as Washington DC, London and Berlin is mostly a pragmatic response to a perceived marginalisation of Western economic as well as cultural influence in Africa. However Beijing is now making attempts to improve its reputation and some of its less attractive practices. Western powers will need to re-engage with their strengths in Africa. Experience, expertise and strong relationships in order to be a part of Africa’s burgeoning rise.

Comments or opinions expressed on this blog are those of the individual contributors only, and do not necessarily represent the views of FRANCE 24. The content on this blog is provided on an "as-is" basis. FRANCE 24 is not liable for any damages whatsoever arising out of the content or use of this blog.
`The above Anonyme comment is absolutely spot-on. It's a pity that an international platform like France24 is resorting to blatantly uninformed bloggers to discuss China / Africa affairs. It is clear that the author, despite having lived and studied in China, does not really understand the threat to civil society that the Chinese regime and model poses to its own citizens, never mind trying to translate that repressive model overseas in developing nations in Africa. Looking to China for lessons on how newly democratised countries on the African continent can develop economically is so wrong and ill-conceived on so many levels that I can only imagine the author is given the platform because the Chinese regime likes to use the blogger to peddle its soft influence, and unfortunately France24 listed this blogger because he happens probably to be the only one blogging in this space (but the first, or the only, is rarely the most informed, and possibly the most easily bought by bigger vested political interests).
Henry, Your posts via China Africa News are often interesting to read and while they attempt a balancing of viewpoints, they often demonstrate a lack of depth of knowledge on what is happening inside of China. I hope that through deepening your general perceptions of China, you can develop more piercing and insightful discourse on the China-Africa relationship. For example, in your piece titled "Clinton's Game" (22/6/2011) you comment: "China’s advantage here is in its immense experience and capacity for providing housing and infrastructure. Multimillion person cities have sprung up in China seemingly overnight. The issue of providing city housing is common to both China and Africa. Therefore plans for a designer city in Angola seem best delivered by Chinese firms." This remark seems almost blatantly ignorant of the widely known problem that is plaguing the Chinese government and economy now, and that is that China's urbanization has resulted in immense inaccessibility for the majority of residents to housing. So, to those unaware who are looking in from the outside the tall buildings and urban sprawl seem an accomplishment, they are actually an indication of serious contradiction - cities with millions of empty apartments owned by rich speculators and millions of families priced out of home ownership and facing rising rental costs. This problem have become so widely acknowledged and problematic that even the state-run media has regular headlines discussing the corruption, inequality, and paradox that has been spawned. Thus, most average Chinese would agree this is no model they would wish upon our friends in African nations like Angola. Furthermore, your recent post titled "Market Forces" (29/8/2011) discusses the suitability and popularity of Chinese goods in Africa. While I agree with most of the content, I think you do an injustice to both readers and consumers in China and Africa by not mentioning the increasing level of dissatisfaction that Chinese consumers have with Chinese products. The fact that, Chinese consumers fighting for consumer rights concerning product quality and safety are one the fastest growing parts of civil society in China. Consumers are becoming outraged by systematic and endemic product quality of mostly domestic products (but including some international goods). Some of the most high-profile cases that have repeatedly received front-page attention in the Chinese news include the infamously fatal tainted baby's milk, toxic children's toys, toxic construction and home renovation materials, and fake medicines. So, while Chinese often choose Chinese products for the same reason African's often do - economic necessity - they are not a panacea for developing nations as there are likely more Chinese consumers objecting to the quality and safety of these "same products" than consumers in Africa - and doing so without any xenophobic motivations. Thus, the relationship between China and Africa is much more informed when examined more closely and both sides better understood in their own context before being compared and contrasted. One unfortunate result of this newly-growing field of China-Africa research and study is that it is allowing the rise of commentators with expertise in neither region or much of anything else to jump on the bandwagon and join the fray - this is something I believe you have pointed to in the past, though possibly not in so many words.

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