Oil at any cost
IN BEIJING NEXT WEEK, leaders of 48 African countries will converge for the largest international summit in modern Chinese history. Many will go home with what they came to collect: rich incentives to sign deals trading away their natural resources to China.
China’s fast-growing economy has created a deep thirst for oil that has pushed it to do business with some of the most corrupt and dangerous regimes on Earth, several of them in Africa. The continent now accounts for 30% of China’s oil imports, and growing. The widening trade isn’t all one way -- Africa is becoming a market for Chinese consumer products -- and it isn’t all harmful for Africa’s impoverished people. Some Chinese investments are giving birth to beneficial new industries in Africa.
Yet Beijing’s guiding philosophy of noninterference with the affairs of other nations, and its growing financial involvement in the developing world, are having an overwhelmingly negative effect on stability and human rights. Setting aside China’s stonewalling on efforts to crack down on nuclear threats posed by Iran and North Korea, its reluctance to impose tough sanctions on Sudan (where it has significant oil interests) is contributing to the ongoing murder, rape and displacement of hundreds of thousands of people in the Darfur region.
As World Bank President Paul D. Wolfowitz pointed out in a recent interview with a French newspaper, Chinese banks also have increased lending to poor African countries that had been granted debt relief by industrialized nations, meaning they might once again be trapped under crushing debt loads.
And Chinese banks haven’t signed on to the Equator Principles, a voluntary set of environmental and human rights guidelines adopted by 80% of the world’s commercial lenders. This makes it easier for Chinese banks to do business with corrupt government officials. Alas, by propping up corrupt regimes while raiding Africa of its resources, China is doing nothing that Europe and the United States haven’t done, which is why pontification from the likes of Wolfowitz rings very hollow in Beijing. Nonetheless, China’s policies in Africa are bound to lead to a dead end.
Banks didn’t adopt the Equator Principles entirely for altruistic reasons. As China becomes more deeply invested in Africa, it will discover that corruption, instability and environmental degradation lead to failed projects, stolen assets, intense public resentment and financial liabilities.
Respect for human rights has never been at the top of the agenda for communist Chinese leaders. But there are more hardheaded reasons for a change in course. China is in grave danger of repeating the West’s money-losing mistakes.