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China’s in trouble; is that good or bad for Africa?

Saturday August 15 2015

With its stockmarket nose-diving in recent weeks, and now its currency, the yuan, taking a small tumble, China has probably done Africa its biggest favour.

China allowed market forces more sway in determining its exchange rate. World markets went into a tailspin.

For the past 10 years, China has been on the lips of every African dictator and democrat as the new saviour.

The dictators shrugged off criticisms by “nosy” Western governments and international organisations, saying they would do business with China, a country that doesn’t meddle in their domestic affairs.

They would sell the oil and other minerals that were popping up all over to China, and have money to live a good life, as Angola did.

The democrats, on the other hand, though they were not imprisoning their critics, were unwilling to give up their privileges. They looked to expand business with China, to find more money to give to those who had been left out.

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And, indeed, China-Africa boomed. In 2014, Africa did an estimated $222 billion’s worth of trade with China — three times more than with the avuncular and finger-wagging US.

Now with the yuan so cheap, not only will China buy less, it will have greater ability to dump cheap goods in Africa. In countries like Sudan, cheap Chinese goods have already wiped out a large section of the jua kali class in Khartoum.

Now if you are making plastic chairs, plates, and cups, you may want to think of a new business plan.

Yet, this is not a complaint. It’s a celebration. China was making Africa lazy and unimaginative. Clever and honourable men and women were kicking back and waiting for China to come and buy or build stuff, and lend them money without taking a hard look at the feasibility studies.

Though at this point it looks like a Beijing hiccup and not strangulation, it is a lesson that even the China party will end. We are being called on to be our own keepers again.

If we had to choose three things, first, is do something everyone has spoken about until they have got black(er) in the face, and done little about — trade more among ourselves. In the case of the East African Community, it needs to expand faster.

Some tough love is needed. Instead of wasting time exploring whether to admit troubled South Sudan, where the leaders are more focused on murderous ethnic warfare, the EAC would be better to woo Ethiopia to the north, and to the south Mozambique. Go with those who are ready for success.

Also, it may help to suspend Burundi’s membership. It too has shown that it’s not ready to contribute to the East African commonwealth. A third-term power grab does not, of necessity, have to end in a political meltdown if you have a half-decent government in place — look to Uganda 2005.

Second, East Africa needs to work toward a higher common education, and therefore, examination standard.

Finally, to seize the digital future, forget the new railways. From Djibouti, through to Ethiopia, Kenya, Uganda, Rwanda, and Tanzania, we need a properly integrated common East Africa fibre optic network.

Africa needs a successful regional bloc that others can envy and emulate. It may as well be East Africa.

Charles Onyango-Obbo is editor of Mail & Guardian Africa (mgafrica.com). Twitter@cobbo3

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