China has funneled billions of dollars into aid, loans and business deals on the African continent in recent years.
But as ties continue to strengthen, a former Nigerian finance minister has warned that Beijing-style economic governance will not work for Africa.
“China has been very helpful,” particularly with building much-needed infrastructure in Africa, Ngozi Okonjo-Iweala, a two-time former finance minister in Nigeria, told CNBC on Wednesday.
But while less economically advanced countries may wish to emulate China’s economic success, the Chinese approach of state-led development would prove unsuccessful for the majority of Africa, she said.
“In most African countries, it has been shown that state-led growth — pure state-led growth — has really not worked,” Okonjo-Iweala said, citing the example of Nigeria’s “vibrant private sector.”
In her view, the Nigerian government, through state-owned enterprises, has not shown itself capable of managing its manufacturing and heavier industries, for example.
Corruption could result from increased government intervention in business, Okonjo-Iweala said. “Some of our governments, when they get into direct provision of jobs and services — that’s where corruption creeps in because it’s not well-handled, the institutions of state are not strong enough, the checks and balances are not strong.”
Okonjo-Iweala served as Nigeria’s finance minister twice, from 2003-2006 and most recently during 2011-2015 under previous President Goodluck Jonathan. She is a former director at the World Bank and is currently an adviser at the Asian Infrastructure Development Bank.
Where China-style economic management has worked
Nonetheless, one African country known for its economic partnership with China is Ethiopia. Infrastructure, as well as industrial parks to boost the manufacturing sector, have been built as part of Beijing’s Belt and Road Initiative, a multi-billion dollar spending plan to resurrect ancient trading routes centered on China.