A symbiotic relationship? Examining Nigeria’s links to China
In a February letter to China’s President Xi Jinping of China, President Muhammadu Buhari hailed China’s support since diplomatic relations began in 1971.
“Nigeria is very satisfied with the progress of bilateral relations, and we thank China for its support to us in various ways: in building rail, road, power, defense and many other areas,” he wrote.
Relations between the two countries have grown exponentially over the past 50 years, amounting to a whopping $70 billion. China also stands as one of Nigeria’s significant trading and export partners. The two nations’ tout a mutual respect for their different socio-political, cultural and economic circumstances. Yet, the relationship is not as symbiotic as it appears.
China has 218 companies operating across various Nigerian states and sectors, ranging from construction and manufacturing to oil and gas. In Ojota, Lagos, tall red walls cover several Chinese sellers’ ample market space. In Abuja’s international airport, the China Civil Engineering Construction’s (CCECC) logo tells of the country’s involvement in ongoing renovations.
The United Nations Comtrade Database on International trade indicated that Nigeria’s total export earnings from China in 2019 amounted to $1.67 billion, while that of China to Nigeria was a whopping $12.06 billion. China’s is higher by $10.39 billion.
Nigeria’s exports to China are numerous, but they are raw or semi-processed. Does this call for celebration? Again, the answer is no. They include mineral fuels, oils, rubber, leather, salt, and cement, among other items. China, on its end, exports manufactured goods to Nigeria, ranging from machinery, nuclear reactors, boilers, electrical and electronic equipment, vehicles, articles of iron and steel, among others.
Interestingly, China uses those raw materials Nigeria exports to process and create finished goods, which it sends back at a price Nigeria can only negotiate but not reject. This technology transfer is one area Nigeria should keep her eyes on as her bilateral marriage with China or any developed countries endures. With a higher technological acquisition level, Nigeria can process its raw materials into finished goods and export them to buyers with much better offers and make more than present the case.
Despite Buhari’s praises, Nigeria’s receive China’s intervention with mixed feelings. Many have complained the government gives out jobs to China since construction companies like CCECC come with their labour. These companies have also taken over many government projects across the country. Local industries must not suffer for Chinese companies to thrive, regardless of any contractual deals.
Several Chinese companies have also found refuge under Nigeria’s liberal policies and respect for bilateral agreements to perpetrate fraud.
China’s influence is equally growing across other African nations, superseding other conventional western donors. According to John’s Hopkins University’s China-Africa Research Initiative, China-Africa bilateral trade has been steadily increasing for the past 16 years, reaching $185 billion in 2018, up from $155 billion in 2017. China recently launched a $1billion Belt and Road infrastructure fund for Africa. Last year, it delivered a $60 billion African aid package.
For China, the benefits are clear. The country desires to secure a solid base of raw materials to fuel its rapidly growing economy, increase its global political influence, and tap opportunities presented by emerging market economies in the continent.
Yet Nigeria must remain watchful because there is hardly ever a free meal. China’s aid is already serving as debt-trap diplomacy. Beijing is the single largest creditor to Africa. Twenty percent of all African government debt is owed to China. Chinese lending to some countries in Africa is already suffocating them. China has loaned $143 billion to African government and state-owned enterprises between 2000 and 2017.