Clooney's a convert, but China must still raise game in Africa

PUBLISHED : Thursday, 22 September, 2011, 12:00am
UPDATED : Thursday, 22 September, 2011, 12:00am


George Clooney was in a mood to charm yesterday.

Scattering a little stardust among the drab-suited fund managers at CLSA's investor forum, the Hollywood celebrity even managed to be complimentary about China's role in Sudan.

Clooney's warm words marked an about-turn from his attitude in 2008. Back then he was scarcely out of the headlines, calling on presidents, prime ministers and even Olympic sponsors to take Beijing to task over its unquestioning support for the murderous regime of Sudan's president Omar al-Bashir.

'Things have changed drastically over the course of the last couple of years,' said Clooney, who told CLSA's clients that far from standing four-square behind Khartoum, China had played a role in assisting South Sudan towards independence in July. 'China has actually been really helpful,' he said.

Clooney has clearly been won over. And on the surface it appears that the new government of South Sudan bears no grudges against Beijing either, despite China's long-standing 'non-interference' policy under which Beijing turned a blind eye to Khartoum's abuses while buying the pariah regime's oil and supplying it with lethal weaponry.

Following independence, China's foreign minister was one of the first high-level visitors to touch down in South Sudan, signing investment deals with the new republic and securing widely coveted oil exploration licences for China National Petroleum Corporation.

But according to Chris Alden, a lecturer in international relations at the London School of Economics who has advised the new government in Juba, South Sudan's willingness to do business with China owes more to its need for ready cash than any feelings of trust or forgiveness.

'There is a deep sense of societal bitterness towards China,' says Alden, who believes it will be many years before the Southerners forget the 'scorched earth' policy Khartoum employed to clear the local population away from its Chinese-funded and built oil pipelines.

But although the South Sudanese would have preferred investments from American or European companies, Alden says the new government in Juba simply could not afford to go through the complicated and lengthy compliance procedures demanded by Western investors. China, on the other hand, was prepared to front-up cash immediately, with no social or environmental strings attached.

In other words, Chinese money talks. Whereas Western donors and investors in Africa worry about software - governance and institution-building - China is prepared to invest now in hardware - roads, telecommunications systems and the like - without asking too many awkward questions.

It's an approach which has enabled Beijing's resource extraction projects in Africa to survive several abrupt changes of government, despite Beijing's close association with, and support for, the overthrown regimes.

'They always seem to come up smelling of roses,' says one mining industry veteran.

But China's policy of backing unpopular ruling elites with no-strings investments faces a couple of tests in the coming months. In Libya, some observers believe Beijing's reluctance to withdraw its support for the government of Muammar Gaddafi may see Chinese companies cut out of the picture when the new administration formed by the National Transitional Council gets around to awarding lucrative oil contracts.

And in Zambia, Beijing's support for the government of president Rupiah Banda and its past condemnation of opposition leader Michael Sata could jeopardise Chinese companies' copper projects should Sata turn out to have won Tuesday's presidential election.

Judging by past form, however, it is likely that China's financial muscle will ensure Beijing a seat at the table with incoming African governments, no matter how unpopular China's policies may have made it in the past.

Even so, the recent upheavals in Sudan, Libya and elsewhere should have taught Beijing a lesson about the risks involved in its past 'no-strings' investment policies.

In a report published on Tuesday, the African Development Bank calls on China to adopt the best practices followed by developed world investors in Africa. Beijing, the bank said, should disassociate its aid donations from its commercial investments, engage with African civil society organisations and labour unions, and embrace the 'Equator Principles' of social and environmental risk management for investment projects.

Hopefully, Chinese officials and companies will pay attention. After Libya and South Sudan, they should have learnt that it will work to their advantage to adopt higher standards when they invest in Africa.

If they do, they will win over many more converts than just George Clooney.