Here in Zambia, just across the border from Mozambique, it becomes clear that China's strategy in Africa is far more than piecemeal opportunism. Last year, Chinese president Hu Jintao announced that Zambia's mineral-rich Copperbelt province -- set amid the rolling hills of the country's north -- will become home to the first of perhaps five tax-free "special economic zones" that China will build in Africa. While the details of the $800 million plan are still vague (the upper tiers of the government have the fine print, but they aren't sharing it with the populace), China says it wants to form an export-based "production chain" with a new $220 million smelter at its heart, luring Chinese investors and potentially creating thousands of new jobs.
China is doing its utmost to paint this initiative as a win-win for everyone, Zambia's citizens included. But it may be too late to win the hearts of the locals. Since the start of the decade, Chinese firms have been snapping up huge reserves of the country's copper, used for everything from electrical wiring and construction to computers and cars. With global copper prices at record levels, Zambians have grown furious, complaining that Chinese operators -- who bought the reserves at lower levels -- are lining their pockets at the expense of the people. During my visit to Zambia, almost everyone I talked to outside the upper tiers of the government spoke harshly about the Chinese. When Hu himself came last year for a groundbreaking ceremony for the new "zone" in the Copperbelt, he had to cut the ribbon from the safety of Lusaka, 200 miles away, because of threats of riots.
China's interest in Zambia is simple. China is both the world's biggest user of copper, soaking up more than a fifth of total consumption, and the eighth-biggest exporter of refined copper products. China has few large-scale mines of its own; its enormous smelting industry relies on raw copper "feedstock" or "concentrate" from abroad. In Africa, Zambia has the second-largest reserves of raw copper (after Congo).
That could be a mutually beneficial trade were it not for one key fact: As with the boatloads of timber leaving Mozambique for China's ports, most of the value of Zambian copper is unlocked only after it reaches China. Zambian politicians have dreamed for years about using their copper to create a light-industrial sector before they run out of the mineral -- most of which is likely to be gone by 2025 -- but there's still no coherent strategy to make it happen. Meanwhile, Chinese entrepreneurs are using fat bank accounts, vast credit supply, and, in some cases, government-funded incentives to buy up exploration and mining rights, just as they have with timber licenses and concessions in Mozambique. As a result, Zambia and, more particularly, ordinary Zambians are seeing very little benefit. While copper prices have quintupled since 2001, more than 70% of locals still live below the poverty line.
"A lot of Chinese businessmen are now looking for Zambians who have small licenses," Enoch Kavindele Jr., the son of a former vice president of Zambia, tells me. They could apply for a license from the government, but, Kavindele explains, "the Chinese find it easier to approach desperate and hungry Zambians who know nothing about mining but who have a license. Walk in with $100,000 in a briefcase, and it's yours."
Western-educated and charming, and wearing a tailored suit, dreadlocks, and jewelry, Kavindele hardly looks like a man being bypassed by economic development. But he says he too is worried for the future. "What will Zambia look like in 10 years' time?" he asks. "Will my children be working for a Chinese company? Will our children still have access to mining?"
At the other end of Zambia's economic scale, those questions have already been answered. For many people here, the only employment available is in a copper mine. The lucky ones may end up with a job at a Western mining giant, or perhaps with Chinese employers, such as the brothers He and Huang, who vow they will pay their local workers $200 a week (the norm is more like $200 per month). The less fortunate will find themselves with no job security, no health care, and poor safety standards at Non-Ferrous Company-Africa (NFCA) Chambishi -- the largest Chinese-owned mine, in the heart of Zambia's Copperbelt.
By all accounts, the workers at Chambishi receive the lowest wages and suffer the worst safety conditions in the Copperbelt, and the mine's managers have gone to great lengths over the years to prevent a local union from organizing the workers. The mine is easily the region's biggest user of part-time or "casual" labor, which keeps costs low -- and the workforce bitter.
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Recent Comments | 10 Total
June 20, 2008 at 2:09am by Elliot Noteware
Wow what an intereting read, we will be tapped out soon.