From an African perspective, China is a vast country shrouded in myth and preconceived ideas, especially when it comes to Chinese doing business on this continent. This is largely perpetuated by the lack of real information on both sides: the Chinese need to know how they are actually perceived so that they can actively work to improve their image, and their African partners need to operate from an informed position in order to take advantage of the many opportunities offered by Chinese investment. Just how wide the gaps on both sides are was highlighted during the recent journalist study visit to Beijing.

Conversations with representatives from media and other Chinese organizations all had a common theme: a desire to learn more about Africa, a willingness to learn from Africans about how to better understand the continent and plugging the widening knowledge gap from both sides.

Media reports about China in Africa have often highlighted huge aid packages, support for pariah regimes and the ruthless exploitation of workers and natural resources in some of the poorest countries in the world and these have sparked fierce debates. China's secrecy has fuelled rumours and speculation, making it difficult to gauge the risks and opportunities in China's growing involvement in Africa.

Probably one of the better-know myths and partial truths about Chinese involvement in Africa suggests that China targets aid to African states with abundant natural resources and bad governments. In reality, China gives money to almost every single country in Sub-Saharan Africa, excluding only those that don't recognise the One China policy (that is those countries that continue to have diplomatic relations with Taiwan). According to Deborah Brautigam(1), there is little evidence that China gives more aid to countries with more natural resources or specifically targets countries with worse governance. China is not alone in showing its interest in Africa's natural resources, and natural resources are not the primary motivating factor for Chinese aid. Like all donors, and here the US, Russia and European countries are certainly included, China is motivated to give aid by a mix of political, commercial, and social/ideological factors. And it has doing so since the Mao regime as part of its solidarity with Africa.

Another common misconception is one that the Chinese don't hire Africans to work on their projects. This depends on how long a company has been working in Africa, and how easy it is to find appropriate local labour. Ultimately, it also depends on African governments themselves, who have the power to dictate what proportion of project staff must be local (as Angola and the DRC have done). Brautigam also points to the stark contrast in standards of living between Chineseworkers and managers in Africa, who tend to livein extremely simple conditions, and Western advisors,who more typically live in expensive housingor hotels. While Western experts may be fewer,they cost their projects a lot more.

According to Brautigam, China's way has several advantages and their experts don't cost much. In addition, their emphasis on local ownership often leads to projects like a new government office building, a sports stadium, or a conference centre. They seem to understand something very fundamental about state-building — new states need to build buildings and dignity, not simply strive to end poverty.

Over the past decades, the Chinese have also funded university scholarships, roads, bridges, mini-hydropower, and irrigation projects when other donors were not investing in these sectors. And like Japan, they see nothing wrong with using subsidies to help foster investment by their own companies; this is seen as beneficial to both sides. From the 1970s to the early 1990s, Southeast Asia's "miracle" was underwritten not only by good policies, but by Japanese investment, and Japanese aid was a partner in this. China's engagement in Africa could have similar results in at least a handful of countries such as Nigeria, Angola and DRC. There is a tendency for the Chinese to avoid local embezzlement and corruption by very rarely transferring any cash to African governments. Aid is disbursed directly to Chinese companies who undertake the projects. The resource-backed infrastructure loans work the same way.

Another popular belief is that China outbids other companies by ignoring social and environmental standards. Brautigam says that this is in many cases true but suggests that there is growing evidence of China and Chinese companies becoming increasingly sensitive to international perception on these issues and may be inching towards international standards.

Over the past few decades, China has managed to move hundreds of millions of its people out of poverty by combining state intervention with economic incentives to attract private investment. Based on its experiences and lessons at home, China is embarking on a similar programme across the continent. The key to this has been using resource-backed development loans to countries rich in mineral resources.

According to African Business magazine (2), in 2008 China replaced the US as Africa's largest trading partner, with the volume of trade reaching $107bn, representing a tenfold increase since 2000.

With foreign direct investment rising from $491m in 2003 to $100bn in 2009, a twenty-fold increase during the past decade alone, China is now not only Africa's single largest source of lowinterest capital, but also–given tariff reduction–its most equitable trading partner.

Since 2004, China has concluded resourcebacked deals in at least seven resource-rich countries in Africa, for a total of nearly $14 billion. Reconstruction in war-battered Angola, for example, has been helped by three oil-backed loans from Beijing, under which Chinese companies have built roads, railways, hospitals, schools, and water systems. Nigeria took out two similar loans to finance projects that use gas to generate electricity. Chinese teams are building one hydropower project in the Republic of the Congo (to be repaid in oil) and another in Ghana (to be repaid in cocoa beans).

In a major experiment, China is helping to build special trade and economic cooperation zones in Africa. Seven such zones are planned. These include two in Nigeria; the others in Egypt, Ethiopia, Mauritius, Zambia, and, possibly, Algeria. Special economic zones were an important feature of China's early development; today, China has more than one hundred such areas. The Chinese government is very aware that these zones must be sustainable in the long term.

For decades, Chinese teams in Africa constructed agricultural projects or built factories only to turn them over to inexperienced and sometimes uninterested host governments. Once the Chinese left, the benefits of the projects declined, prompting the host governments to ask the Chinese to return. Now, Chinese companies are taking responsibility for both designing and building the zones and then managing them as businesses. Beijing will subsidize part of the start-up costs, including some of the expenses that Chinese companies incur by moving operations overseas. Several of the agencies involved in China's own successful zones are advising -- and in some cases, investing in – the projects in Africa (3). China's venture-capital fund for Africa, the $5 billion China-Africa Development Fund, has taken equity shares in three of the seven planned zones. A new $1 billion fund for small and medium enterprises in Africa, which was announced at the November summit in Egypt - the fourth Forum on China-Africa Cooperation (FOCAC) held in November 2009 in Sharm El Sheikh, Egypt - will help African entrepreneurs set up businesses in the zones.

However, the gaps in perception and reality are not only confined to Africans viewing China. This also colours the way Chinese view Africans and their continent – Africans as lazy and corrupt and the continent as a vast underdeveloped paradise teeming with exotic wildlife. The fact that these views can persist in an age of internet technology and instant information, indicates a lack of crucial factual information. Although language is a huge barrier – on both sides – China's strong grip on its media does restrict the lack of information. A journalist from the official People's Daily proudly pointed out that his publication's policy is to print only positive stories concerning Africa – this ignores one of the basic tenets of journalism and that is to provide a balanced view. Both sides need more and diversified access to information to better grasp the opportunities and challenges presented by doing business with each other and while there is the strong desire to learn more about each other, this momentum should not be lost.

Sources consulted:

1 - Foreign Affairs – Africa's Eastern Promise, Deborah Brautigam 5 January 2010

2 – African Business Magazine 2008

3 - Laura Freschi Published February 9, 2010 – Aid watchers.com

(Janet Szabo is a International and Military researcher based with the South African Broadcasting Corporationin Johannesburg.)