China in Cape Verde: the Dragon’s African Paradise
Saturday, January 5, 2008 at 00:23 January 2nd, 2008
By Loro Horto
China’s first established relations with the West African nation of Cape Verde in April 1976. Ties remained friendly and courteous in subsequent years, but largely confined to intermittent cultural exchanges and rare visits to Cape Verde by mid ranking Chinese officials. China had hardly any economic interests in the archipelago nation of some 300,000 inhabitants, and Cape Verde’s complete lack of natural resources made the islands a low priority in Chinese foreign policy. Nonetheless, China kept a diplomatic presence in order to prevent Taiwan from gaining entree.
The task of barring Taiwanese influence was made easier by Cape Verde’s relative invulnerability to Taipei’s “checkbook diplomacy.” Despite its disadvantages, Cape Verde is something of a success story in terms of nation-building. Relying on a large and well-educated diaspora in the United States and Europe, good governance, and a pragmatic approach to foreign relations, Cape Verde has become one of the wealthiest nations in sub-Saharan Africa. It’s GDP per capita stands at $6.000, and the country’s health and education systems are among Africa’s best.
China’s engagement in Cape Verde began to intensify in the mid-1990s, with the arrival of Chinese small-scale private investors. Their numbers were few at first, but increased steadily as the local economy prospered and stories of their success reached home. This investment pattern is quite different from that seen in the oil-rich countries, such as Angola or Sudan, where large state-owned Chinese companies led the way. Typically the head of a small business (baihuo in Chinese) – usually the head of the family – would move to Cape Verde, accompanied by a male relative to assist him. They set up the business, and if things went well, other family members would join them to expand and diversify the enterprise. This type of investment continues, and an estimated 200 Chinese shops can now be found in Cape Verde, concentrated on the islands of Santiago and Sao Vicente. As is the case elsewhere in Africa, realiable statistics on the number of Chinese in Cape Verde are hard to come by, but a Cape Verdean official estimates that as many as 2,300 Chinese nationals now live there “in one way or another.” This is a large number, considering the country’s small population; and the Chinese foreign community is second in size only to the Portuguese.
Now that China’s small investors have shown the way, larger investors are following. The tourism sector is a big draw in view of Cape Verde’s proximity to major European tourist hot spots, such as the Spanish Canary Islands and the Portuguese islands of Madeira and Porto Santo. In early 2007, Macau millionaire David Chaw announced a $100 million project to build a massive entertainment park, with a casino, restaurants, night clubs, hotels, and a marina, on the islet of Santa Maria, just off Praia, the capital, to be completed in 2009. He pledged a further $300 million in coming years in major infrastructure projects in the capital, including power plants, roads, and office buildings. Chaw’s role in Cape Verde highlights the increasing involvement of Macau business tycoons elsewhere in Portuguese Africa, including Angola and Mozambique, and even in war-torn, narcotics-infested Guinea Bissau.
_____________________________________________________________________
Loro Horta is a research associate fellow at the S. Rajaratnam School of International Studies, Nanyang Technological University, Singapore. He lived and worked in Africa for several years and has written extensively on Portuguese Africa
