Just thirty years ago, extreme poverty and hunger were widespread in China and the level of poverty in the country was one of the highest in the world, about 64%. The situation in China could be compared to the current problem in Africa, with less educated people engaged in the agricultural sector, earning very poor.
Over the past 10 years, the annual growth of foreign direct investment in Africa has reached even more impressive figures, reaching 40%. The level of financial support, investment and technical support from the world's second-largest economy was enormous. There is no indication that support from China will decline.
China not only focused on African countries with vast natural resources, such as Nigeria and South Africa but also in poorer countries, such as Ethiopia, Uganda, and Kenya. In fact, it is in Eastern Africa that China directs the most significant investments.
China has penetrated almost all corners of the continent. At least 40 African states have signed bilateral trade agreements with the Chinese government. China’s systematic interaction, cooperation and deepening relations with Africa, have surpassed the United States in 2009, becoming Africa’s largest trading partner.
Beijing has invested in infrastructure, the agricultural sector, and telecommunications systems. Having ratified the International Telecommunication Union Convention, which obliges its members to ensure the transition from analogue to digital television until June 17, 2015, many African countries have turned to China for support.
Many African countries continue to focus on the Chinese model of development and the results are amazing. For example, thanks to the development of road infrastructure, farmers gained access to new markets and were able to efficiently transport their products.
However, despite economic advances, Africa, unlike China, which has managed to improve the living conditions of nearly 1 billion people, has not yet been able to solve the problem of poverty. Modernization of ports, construction of roads, railways, and the improvement of communications haven’t reduced poverty on the continent yet.
Africa is fighting to transform itself into a fast-growing economy. African countries strive for better economic prospects, diversify their economies, invite investors from all over the world and, importantly, invest in education and technology. Nevertheless, poverty remains a big problem.
Research shows that China’s economic growth has become a weapon for poverty eradication. Per capita income from 1978 to 2014 increased 16 times. This made it possible to reduce the level of poverty in China from 88.3% in 1981 to 1.9% in 2013. According to World Bank forecasts, China will continue to effectively fight poverty. In 2018, the level of extreme poverty in China falls below 1%.
While Africa demonstrates the prospect of sustained growth in key areas of the economy, including manufacturing, there is a marked gap between this steady growth, inequality, and poverty. Studies show that an increasing number of people live below the poverty line.
Experts warn that inequality, high population growth, the gap between the level of development of successful African countries and poorer African states impede the process of transforming economic development into a higher level of quality of life for all inhabitants of the continent. The rich get richer and the poor get poorer.
Africa could draw many lessons from the history of China’s unprecedented economic growth, by which Beijing was able to escape the trap of poverty but can China bring that magic to Africa? Time will tell.
