InvestmentSouth Africa

Chinese Investment Strategies towards Developing Countries

Within China’s global activities, Sino-Southeast Asian and Sino-African relations have evolved remarkably. One of the prominent examples of this is China’s increasing amount of outward foreign direct investment (OFDI) in these regions. Despite the large number of policies issued, there is a lack of analysis of China’s OFDI. From the perspective of host countries, the large scale of FDI from China can have strong implications, thus, it is important for government agencies to monitor/analyse the Chinese investment inflow. This will help governments to understand China’s policy context and maximise the benefits thereof.

As Chinese investments on the African continent grow, questions have arisen regarding the ways in which the Chinese state and corporations protect assets and personnel abroad. More broadly, in what ways do such measures compromise China’s oft-touted “non-interference” policy? This research project, written in conjunction with Jiang Hengkun (Zhejiang Normal University) seeks to map out the terrain through an examination of Chinese security practices in South Sudan. By drawing on examples of scale, from state owned oil enterprises to small urban traders, the research highlights varying roles which the Chinese state plays in relation to its citizens’ protection abroad. The research is based on a Saferworld funded fieldtrip to South Sudan in April 2013.

The project engages in an empirical comparison between the economic relations of South Africa and the PRC, and South Africa and Taiwan, in light of the (potentially conflicting) foreign policy doctrine of ‘One China’. As its primary question, this research will examine the extent of political reach into the economic exchanges which occur between the three parties, with a specific focus on South Africa’s ability to navigate its way through such a challenging relationship. The project examines ways in which the harnessing and deployment of non-state-actors enables South Africa to adapt to new political contexts. More broadly, it is anticipated that this research will shed light on the primacy of economic trade with regards to South Africa’s foreign policy toward East Asia, and an underlying pragmatism which may be at odds with official policy.

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