Investment in Africa mutual beneficial

According to the Ministry of Commerce, China’s overseas direct non-financial investment in the first six months of 2018 reached $57.18 billion, up 18.7 percent year-on-year, maintaining a relatively strong momentum.

China’s overseas investment has for long been criticized by some Western scholars, media, even government officials. A report titled Debtbook Diplomacy published by Harvard Kennedy School in late May even claims that China has leveraged its loans to other developing countries to achieve its strategic goals. These accusations belie the critics’ double standards when it comes to China.

China has, to some extent, ignored the investment risks that have prevented many Western countries from lending a hand to African, Central Asian and European countries. In general, the West has shied away from investing in those countries it considers vulnerable and thus denied them a chance to fulfill some, if not all, of their development goals.

Yet some in the West are blind to their own moral hazard and jump to conclusions — of finding faults with China’s investment. This is ridiculous, even hypocritical, because only the recipient countries are in a position to assess the nature and impact of Chinese investment.

Chinese companies’ overseas investments are purely based on market rules, which are, as they should be, beyond the Chinese government’s control. The Chinese government has even encouraged Chinese companies to invest overseas to support other countries’ economic development and promote global growth.

In stark contrast, US President Donald Trump has been openly interfering with the market rules and global economic structure by using a carrot-andstick policy to draw US manufacturing companies, back to the country.

Yet cases of Chinese companies failing in their overseas investment ventures are not uncommon, due mainly to a lack of proper survey and understanding of risks, which highlight the importance of due diligence. In the future, Chinese companies should thoroughly assess the commercial viability and sustainability of an overseas project before investing in it.

Nevertheless, the government should take necessary measures to solve some key problems in the domestic market, as only a healthy, thriving market at home can support quality investment overseas.

About 3,500 Chinese enterprises have invested in Africa, mainly in the infrastructure,

Apart from promoting Africa’s economic growth and creating job opportunities for the local residents, Chinese investment in Africa has also been beneficial for China. For instance, since a joint venture between a Chinese enterprise and a Kenyan company is in charge of the MombasaNairobi Railway management, the project will not only be successful in the long run, but also offer the Chinese side an opportunity to make further profits.

All entrepreneurs know the higher the risks, the higher the returns. With less-developed markets and vast untapped economic potential, Africa promises investors that offer new means and know-how to boost African counties’ development a chance to harvest above-average gains. No wonder many of the Chinese investments in Africa have yielded good returns, though profits vary from project