Abstract
This study has been performed on the reality of the economic dimensions of China Investments in Africa during the period between (2000-2015). The Study adopted the descriptive analytical method by standing on the volume and the type of Chinese investments in the African continent. The study focused on the returns of these investment and the related exchange relations, on the economies of the African countries. The study found that the Chinese investments in Africa are direct investments that influenced the size and nature of the exchange between the two parties, which has been in favor of China's balance of trade. The study confirmed the increase of Chinese investments in the continent during the period (2000 -2013) but these investments began to decline thereafter. The study attributed this decline to the slowdown of China economy, instability in different African countries, in addition to the economic pressures exerted by western countries. All this has led to the decline in investments & exchange with the countries of the continent in general. In addition the study has reported that Chinese investments were concentrated on the field of natural resources and energy, which led to uneven impact on the economic indicators of the continent countries (poverty rates, GDP, growth rate & balance of trade. est.). In conclusion the study recommended that Chinese investments in Africa should be taken with more studies and analysis & with some additional control, monitoring and evaluation. Also African countries should re-evaluate their regional economic alliances and entities to avoid contradiction & lack of coordination in their investments policies, especially when dealing with foreign investments.
Highlights
One of the priorities of the growing Chinese economic ties with African countries in recent years is focusing on opening African markets to Chinese products
For example stated that, "foreign investment secures foreign capital, and employment", Stowipher confirmed that "foreign investment helps in capital formation", Dennej followed suit saying that "it helps in exploitation of resources", on the other hand some view foreign investment as exploitation of countries and drainage of their resources while others view it as increase in export and promoting technology
Types of Direct Foreign Investment a-In terms of Form: This is a type of investment seeking a foreign identity already established through possession, transfer of property, merge or buying across border. b-In Terms of Strategy: 1-Horizontal investment: It refers to investing in all branches which produce goods similar to those of the mother country to facilitate access of investors to foreign markets or to overcome external factors such as customs’ duty barriers or transport cost which might have a negative impact on the competitive status of exports. 2-Vertical investment: It refers to the investment in the different stages of designing, production and marketing of products in different countries through affiliated companies to benefit from production cost differences in different countries
Summary
One of the priorities of the growing Chinese economic ties with African countries in recent years is focusing on opening African markets to Chinese products. This secures its imports of energy and raw materials from these countries. Owing to the importance of this relation and its direct returns on the economic aspects of African countries, this study has been conducted to get a breasted of the economic dimensions of this relation through exploring exchange volume and Chinese investment orientations in all economic fields. This study has adopted the descriptive analytic methodology to highlight the volume and type of Chinese investments in the continent to eventually arrive at results which support the study’s hypotheses, conclusions and recommendations
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