Increasing Chinese Influence in Africa
Posted By Rob Millard - 0 Comments -
The Brenthurst Foundation, an African strategy and policy development think tank founded by the Oppenheimer family (owners of the De Beers diamond empire) have published an important discussion paper on Chinese economic interests and investments in Africa. It makes interesting reading for anybody with strategic interests in Africa.
Chinese trade with Africa was estimated at about $4.6 billion in 2004 and is expected to climb to about $15 billion by 2010. There is a great deal of Chinese interest and involvement in development of the continent's petrochemical reserves in particular, which at $60 a barrel approaches $4-5 trillion in value. The implications of an inflow of anything like that amount of capital into the continent over the next decade, make it difficult to imagine that Africa in the 21st Century will be anything like Africa in the 20th Century.
Improved governance and reduced levels of conflict makes it increasingly likely that the funds will find their way to improved infrastructure, telecommunications, education, financial reform and other povert alleviating and economic enhancing progammes, rather than despots' private offshore bank accounts.
Africa is not so much underlawyered, as unlawyered. Besides the major firms in South Africa and a dozen or two excellent but very small firms spread throughout the rest of the continent, there is very little capacity for high end commercial work. The premier London firms and, to a lesser degree, US based firms capture the lion's share of the cream at the top of the spectrum.
Can the premier South African firms can make significant inroads into the pan-African markets? Unlike the civil engineers and a few other kinds of professional service firms, to date they seem to have made relatively little effort to grow market share in the rest of the continent. Perhaps the most significant pan-African legal services organization is DLA Piper Rudnick with its association with Cliffe Dekker in South Africa and the Portuguese firm Miranda Correia Amendoeira & Associados through lusophone Africa (including, significantly, several important petroleum-rich west coast jurisdictions.)
There are also several other alliances, the most signicant of which are those of Denton Wilde Sapte in London, Africa Legal which is coordinated by Deneys Reitz in Johannesburg, and Lex Africa which is coordinated by Werksmans Attorneys, also in Johannesburg.
It remains to be seen how this will all develop in the coming few years.
A PDF of the Brenthurst Foundation paper (19 pages) may be downloaded here. Download file
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