Hamish McRae: Our vision of Africa ignores the reality

Western relations are dominated by aid, while Chinese relations are dominated by trade
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It is a year on from Live 8 - a fact that has inevitably and properly led to questions about what that huge, and in its way wonderful, initiative has actually achieved. Unsurprisingly, there is a sharp divide between the critics and the supporters; those who argue that not enough has actually happened and those who say this was always going to take years. Organisations such as ActionAid incline towards the first view, while Tony Blair, Gordon Brown and Hilary Benn signed a joint article in this newspaper on Monday making the case for the latter.

More surprising, however, is the division between different sorts of critics. On the one hand, there are the aid agencies like ActionAid, who feel not enough is being done. On the other, there is a set of people, mostly in the business community, who feel the approach of the G8 - and indeed of the aid agencies - is too top-down, too prescriptive, maybe even too "colonial".

Their argument is that it is wrong to focus on Africa's failures and not to acknowledge the enormous, if uneven, economic advances that are being made. For example: Africa has 150 million mobile phones and is the fastest-growing market for mobile telephony in the world. Mobile telephones, of course, are not just consumption items. In Africa they are a crucial element in its economic progress, for in the space of perhaps five years they have overcome one of the continent's most serious economic handicaps: poor fixed-line telecommunications.

It may even be that the image of Africa promoted by the Make Poverty History campaign - pictures of starving people - has made matters worse, not better. Richard Dowden, director of the Royal African Society, argues that this demeans the Africans living on the continent and those living abroad who send some of their earnings back to support their families at home.

It is hard to defend western trade policies, and the fact that nothing seems to have been achieved on that front is both disappointing and, I'm afraid, disgraceful. But even apparently well-founded policies such as aid forgiveness can backfire by pushing up the countries' exchange rates and making their exports less competitive. A further, if obvious, point is that the great success stories of economic development, the progress made by India, China and the East Asian "tigers", has had little to do with aid.

In Africa there are two further dimensions: its natural resources and its relationship with China. The commodities boom has brought a corresponding boom in the resource-rich parts of the continent, and the avid deal-seeker here has been China. The Chinese leadership has been scouring the world to secure its access to raw materials. In recent months, the focus has been on Africa, with Prime Minister Wen Jiabao, President Hu Jintao and foreign minister Li Zhaoxing visiting 15 African countries. Among the deals have been oil exploration off the Angolan coast, oil-drilling licences in Nigeria and drilling rights in the Indian Ocean off Kenya.

China has become Africa's fastest-growing business partner, with trade up 37 per cent last year. Expect that to continue to soar in the years ahead. You could almost say that western relations with Africa are dominated by aid, while Chinese relations are dominated by trade. So which is more likely to help sustained economic progress, western altruism or Chinese expediency?

If there are problems with the G8 approach, there are also difficulties with the resource/ Chinese one. There is an obvious issue as to how long the commodity boom will continue. In the case of oil, it seems sensible to accept that prices will remain reasonably high for the foreseeable future, particularly given Chinese energy demand. For other commodities, the picture is less sure. But even if commodity prices remain high, that does not ensure sustained and broadly based economic progress. It may just fuel corruption.

As a general rule, countries that are rich in natural resources prosper only if they have strong civic institutions that can ensure the rule of law, enforce property rights and resist corruption. An example would be Canada. Countries that have weak institutions, and I suppose Nigeria would be a good example (though there has been recent progress), fail to spread the wealth or use it to develop non-resource-based development.

This is widely recognised, and just yesterday I saw that Peter Eigen, founder of Transparency International, has been asked to join Tony Blair's Africa Progress Panel, the body charged with following up on the G8 initiative. That is good. Transparency International has done a terrific job identifying and measuring corruption levels around the world. But, inevitably, crunching down on corruption has to come from within.

There is a further problem, which is that China's relations with African countries are qualitatively different from those of the West. There is no colonial guilt, for a start. There is instead a tough-minded, "what can we get out of this?" approach. That has the advantage of clarity and a welcome absence of hypocrisy, but it does not bring much to the party.

This approach is hard to pin down, but there is lots of anecdotal evidence. It has been put to me by several people that the Chinese, rather than attempting to employ local labour, will bring their own people, including support staff, into a country to carry out a project. When the project is complete, they go home. Since there is no effort to train local people there is no transfer of knowledge, no spin-off benefits beyond the particular enterprise in hand. This is not to say that Chinese oil exploration will be conducted in a less scrupulous way than exploration by a western oil company. But it will be subject to less public scrutiny, and will be less likely to be hit by environmental, consumer and legal pressures.

The key point here is that we inevitably see Africa's external economic and political relations through a European prism. How could we do otherwise? But the way we see Africa no longer reflects the economic reality and, I suspect, will increasingly not reflect the political reality either. At its most basic, African countries no longer need to look to the big western oil companies for partners in oil exploration. There is an alternative: the new kid on the block.

Not every African country has natural resources that the Chinese wish to exploit, so not every part of the continent is affected. But in reviewing the effectiveness of the western initiative that was given a kick-start by Live 8 a year ago, we have also to acknowledge that large parts of Africa will no longer automatically look to us. And that has changed in the past year - a huge power shift that will run for many years yet.