Chinese Investment in Africa

1
Chinese Investment in Africa

• Danielle A. Daley
• Hermila Yifter

2
Question I

• What are the economic affects on African nations
  in terms of GDP (per) capita due Chinese
  investment?

3
Question II

• Why is China investing in Africa (motives)?

4
Hypothesis

• From limited research, we have come to the
  conclusion that there is a positive correlation
  between growth in GDP in Africa and increase in
  Chinese investment

5
Motives and Factors

• To seek lower cost for their operations and
  productions
• To seek foreign markets
• To seek resources
• To seek strategic assets
• To diversify
• Type of government

6
African Countries

• Sudan
• Angola
• Nigeria
• Ethiopia
• Zambia
• South Africa
• Algeria

7
GDP
Angola
Ethiopia
8
GDP
Sudan
Zambia
9
Types of Investment

• http//www.heritage.org/research/projects/china-gl
  obal-investment-tracker-interactive-map

10
Selection Problem

• Did China start to invest in these specific
  countries, because they knew there was potential
  profit?
• Did Chinese investment cause the GDP to increase?

11
Appeal of Chinese Investment

• In contrast to western financial institutions,
  China employs a no strings attached method of
  investment in a resources- for infrastructure
  model. Laufman, Adam Chinese Investment in
  Africa (2005)

12
Take Away Points

• Chinese Investment in China does affect African
  nations GDP
• Compare GDP of Africa and FDI of China
• Main motives of China in African nations are self
  interested in natural resources and strategic
  assets
• Our research questions does have mutual
  causation, but we are focusing does Chinese
  investment cause growth in GDP