China's Entry into Construction Industries in Africa

Abstract

Construction companies have played a key role as vanguards of China's engagement with Africa. China has a long history of relations with both Tanzania and Zambia, and the privatisation and deregulation of China's construction industry has been accompanied by a steady increase in the number of Chinese companies entering these two African countries. Differences in the construction industries of Tanzania and Zambia reveal interesting patterns in the participation of Chinese firms in these countries’ economies. In Tanzania, the Chinese are not yet in competition with indigenous companies which lack capacity for large-scale projects. The standards of work completed by Chinese companies are considerably higher in Zambia where regulations and building codes are more strictly enforced. The Chinese have little interest in joint ventures, although they regularly subcontract local companies and procure considerable quantities of local materials and labour. Western companies maintain a decreasing advantage in specialised or technical areas of construction; however, the Chinese adapt more readily to the African environment and quickly find their feet. Once established, the only serious competition Chinese companies appear to face is from one another.