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Edson Ziso Chinese-led South-South cooperation: The Political economy of the internationalisation of Chinese capital in Africa through Special Economic Zones University of AdelaideLee Kuan Yew School of Public Policy, May 25, 2014

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INTRODUCTION South-South co-operation is not new, but a historical continuity which has now reached very significant levels Current co-operation led by rising Southern powers (China, India) Multifaceted layers of co-operation. This paper focuses on Special Economic Zones (SEZs) 2

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Methods Case studies Chinese-led SEZs found in Ethiopia, Mauritius, Nigeria (2), Tanzania, Zambia, Botswana, Sierra Leone, Egypt Jiangsu/Eastern Industrial Park Addis Ababa, Ethiopia construction materials, Steel products Chambishi Industrial Zone Chambishi, Zambia Copper processing 3

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Framework 1. Internationalisation of capital Gonzalez-Vicente: Internationalisation of the Chinese state Glassman: internationalisation of clases of capitalist society Bryan nation state ensures the reproduction the class relations of capitalism 4

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Framework (cont.) 2. International Political Economy Is South-South co-operation a win-win arrangement Globalisation with Chinese charactersistics Are there winners only? Or are there losers as well? Who wins, who loses? 5

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Findings Chinese offshore SEZ policy-making is strategic (Ethiopia is Africa-strategic diplomatically and politically) Spread of soft power Overprotection of State Owned Enterprises in China Resistance/restriction of foreign firms in China Chinese firms relocate to Africa and establish SEZ for their own survival Ethiopia and China too weak (politically and institutionally) to negotiate better deals with China 6

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Findings cont. South-South co-operation is very much elite-based (fractions of capital) linked politically, state-state (Communist parties) A challenging new frontier of governance Public sector/private sector paradox Share of local investors is very low 7

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Some implications China Domestic pressure at home of soiled image abroad? Inefficient enterprises due to overprotection Export of jobs abroad Win-win not guaranteed but either way, China wins China will always not want a common African position towards Beijing (hypothesis) 8

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Ethiopia/Zambia No accountability in the case of SEZ failure Real economic benefits continue to accrue to those in the big tent Private sector blurred Democratisation of the state compromised (not a priority) Positives like technology transfer but still minimum benefit 9

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Tatenda, Siyabonga, Amesa gena lo, Thank you! 10