The conference on African economies, held last week in Tunisia, breathed confidence. “I have never been so optimistic,” said Donald Kaberuka, President of the African Development Bank (ADB).

By Koert Lindijer

The economic growth in Africa does not come only from the booming trade with Asia, and especially China. “It’s the result of our own reforms,” underlined ADB Vice-President Mthuli Ncube.

An International Monetary Fund (IMF) report has generated a sense of optimism. Africa will survive the worldwide financial crisis without a lot of damage, the IMF predicts. The average yearly growth for Africa, which had been 5 % since 2000, dropped to 2.5 % in 2009. But it is expected to climb back to 5 % this year and even higher next year.

Western cynicism
In Tunis, African economists and directors of central banks discussed ways to stay on course. And how to prevent Africa from falling back into misery after having taken advantage of a trend in the world economy for only a short period of time.

Pascal Lamy, head of the World Trade Organisation (WTO), warned: “Being too dependent on raw materials is dangerous.” In other words: Africa shouldn’t be blinded by the growing Chinese demand for raw materials.

Many speakers emphasized that ‘China bashing’ is mainly a Western hang-up. Asian countries like China, India and Malaysia recognise the African dynamics and potential very well; their optimism is in contrast to the Western cynicism and proves to be infectious.

“Colonised again”
But there are also doubts. Some speakers even said that the honeymoon with China is over. These days, hundreds of thousands of Chinese labourers are working in infrastructural projects financed by China, and tens of thousands of them are running businesses. African jobs are in danger. Replicas of the more than one-thousand-year-old Tunis mosque are made in China. In Nigeria, Chinese sell flip-flops and in Congo they run tea houses. “If we’re not careful we are at risk of being recolonized on our own request, this time by China,” warns the Ethiopian economist Fantu Cheru.

China carries out developments projects in exchange for raw materials. Is that a new type of foreign aid? Is it an alternative for the Western involvement in Africa? The poor infrastructure and the chronic lack of electricity are reportedly the biggest threats for economic growth. A yearly 20 billion dollars worth of investments are needed to stimulate trade and the underdeveloped agricultural sector. And China is able and willing to cough up those billions that are needed for the construction of tens of thousands of kilometres of roads and railways, as well as for hydroelectric plants and investments in telecommunication.
 
Diaspora
In order to become less dependent on China or the West, Africa will have to tap its own financial sources on the continent. Tax collection needs to be improved and the illegal outflow of capital stopped.

An attractive source of revenue are the roughly 29 million Africans living abroad. In 2008 they transferred 21 billion dollar to their home countries. Some say that nowadays development aid is less than the money transfers from Africans in the Diaspora. For the poorer countries, however, development aid is still of overriding importance. It is still necessary.

African economist say that cutting back the development aid budget, something the Dutch government intends to do, is ‘short-sighted’, because it reduces the chances of the world economy picking up. The macro-economic data show that Africa is finally moving up. But it is still the poorest continent. In order to fight the massive poverty, the African economy needs a 10 percent or more growth rate, economists at the Tunis conference estimated. That rate is now 5 percent. And the ties with China are under pressure.