Tobias Broich & Adam Szirmai#2014-049

This paper discusses the entry of China into the game of foreign finance in Africa. It analyses the scope, destination and sectoral distribution of Chinese financial flows and trade in comparison with Western patterns and trends of aid, foreign direct investment (FDI) and trade. China's foreign aid and manufacturing investment flow to Africa's physical infrastructure and productive sectors of agriculture and manufacturing fill the vacuum which emerged when Western financial flows shifted to other sectors and activities. In contrast, China's trade patterns with Africa highly resemble those of Africa's leading Western trading partners. Africa imports manufactured goods and exports primary goods. Differences in relative factor endowments of labour, capital and natural resources are largely responsible for the pattern of Sino-African trade.



Key words: Growth and Development, Foreign Finance, International Trade, China, Africa



Discipline: Development Economics, International Relations, Political Economy, Public Policy



JEL Classification: F10; F21; F35; F50; O19; O53; O55

Social Share