| The relationship between China and South Africa is close. Trade has unprecedentedly grown during recent years making China South Africa’s largest trading partner. In 2011, trade between China and South Africa has reached US$ 16 billion, of which $ 4.9 billion accounting for South Africa’s exports to China. China’s Out-ward Foreign Direct Investment stock to South Africa accounted for US$ 4.1 billion making the country the largest recipient of Chinese investment in the continent. Chinese investments in South Africa have contributed to the improvement of some major sectors, such as telecommunications, banking and finance – not to speak of China as a main customer for South Africa’s coal and other mining products. Not least for this reason, China agreed to invest $2.5 billion when Deputy President Kgalema Motlanthe visited the Middle Kingdom in September 2011. At the time, the investment projects in South Africa were yet to be named.
China, during recent years, has seen high-level delegations traveling in quest of learning, cooperation and partnership. In 2011, South Africa was invited to join the BRICS “club”; China hosted the BRICS meeting in Sanya and has played a key role to bring along South Africa. And there are contacts between the Chinese Communist Party and the ANC. But a ‘China moment’? Hang on a moment, folks!
Partners with Beijing, yes – but with a different political view
China has a political system based on a central government that issues policies and controls the economy of the country. Chinese State-Owned Enterprises are strongly linked to the Chinese government either at the central or provincial level. They are backed by state financial and political agencies for local and overseas operations. When President Zuma is now calling for more investments in infrastructure by South African state companies to boost the South African economy and bring more foreign investments, he is operating in a very different context.
In order to achieve its extraordinary growth, China has put in place development plans and programs projected in a five-year period that allows the ‘Middle Kingdom’ to set investment priorities by sector and by province. This well-planned policy has today contributed to the modernization of many Chinese cities, and allowed Chinese policymakers to undertake reforms in different sectors – even if the Western part of the country still remains “forgotten” by Beijing’s policies. China’s economic growth during recent years is entirely centered on exports of manufactured goods. This has been possible with foreign direct investment by foreign companies in China’s manufacturing industry and by the mere size of human capital based on its enormous population. Yet, times – and strategies – are changing.
As trade and investments between China and Africa are growing, China’s economic growth model has in the recent years caught the eyes of many African leaders to replicate the Chinese development’s pattern in their own countries. With this year’s ‘State of the Nation’ address, President Zuma and the ANC are allegedly willing to adopt a Chinese development model. Some media are speaking of ‘South Africa’s China moment’. Well, is it?
Although China has rapidly recovered from the economic and financial crisis maintains its outward foreign investment path, we expect to see slackness in China’s overseas investments mainly in Africa in the forthcoming years. China is thinking about shifting its development model in order to satisfy its people’s needs; domestic demands become more urgent. Therefore, social reforms become important in China’s 12th five year plan (2011-2016) to solve, for instance, contested land issues, increase workers’ wages, etc. China needs more local investments in order to create jobs for millions of people who moved from rural areas to major Chinese cities looking for opportunities and a better life. China’s 12thth five year plan in this regard aims at development increasingly driven by demand within the country in order to address the social disparities.
No ‘China moment’
For South Africa, the situation looks different. Media talk about South Africa’s ‘China moment’ is simplistic, if not just polemics. The ‘State of the Nation’ speech marks a shift away from the market-liberal model, which has in its extreme form, been part of the problem in the financial crisis. ‘The market’ is being regulated for policy goals and the state has a role in the economy. The devil’s receipt, cooked up in Beijing? Yet, this also sounds surprisingly familiar, for instance, to continental Europe, including its current powerhouse, Germany One might have doubts about delivery on the goals in South Africa (and, in fact, for that reason vote for the opposition). But South Africa is a far cry away from centrally controlled China. South Africa is, indeed, still among the world’s top countries – with regard to social inequality! It is far beyond the (widening) social gap in China.
The ‘middle kingdom’ has already undergone massive economic reforms, it needs to be reminded, and these changes often came with hardship to the average Chinese citizen – despite the consistently ‘Socialist’ rhetoric. If President Zuma really wanted to go the full Chinese (economic) way, as alleged, he would surely encounter fierce domestic resistance – not least so from trade unions. Investment in infrastructure is not a ‘Chinese model’ in itself; investment in infrastructure can create (lower skilled) jobs. And these investments will clearly then have to be complemented by emphasis on education, education, and education!
Any developing country can be inspired by China’s breathtaking modernization and the rapid reduction in poverty over these last three decades. However, sustainable development has thus far not been ‘made in China’; South Africa will have to find its own way. The world ‘out there’ is competing, including the rest of Africa. If one thing can be learnt from China, then it is that carefully but determinedly opening up to the world was successful.
Dr Sven Grimm
Director, Centre for Chinese Studies at Stellenbosch University
Dr Daouda Cissé
Research Fellow, Centre for Chinese Studies at Stellenbosch University
Source: Centre for Chinese Studies (http://www0.sun.ac.za/ccs/) | 
