Ten years have passed since Malawi turned its back on Taiwan and embraced the People’s Republic of China, in a diplomatic move that was heavily criticized by some economic and social commentators at the time.
By December 28, 2007 Malawi had already established diplomatic ties with China, but the then-minister of foreign affairs who later became president of Malawi, Joyce Banda, announced the diplomatic changes officially in January 2008.
At the time, Taiwan warned Malawi that China was up to no good, saying the shift in recognition would negatively affect Malawi’s natural resources which Taiwan said China was angling for.Enjoying this article? Click here to subscribe for full access. Just $5 a month.
Malawi is endowed with a lot of natural resources, including minerals and timber.
Malawi Foreign Affairs spokesperson Rejoice Shumba defended Malawi from the Taiwanese allegations in an interview last month that Malawi as a sovereign country is in full control of its natural resources.
“Natural resources are not just produced for preservation or admiration they are also a source of income. Malawi has in place a plan where it decides how much should be sold and what to keep. Therefore, it all depends on what Malawi as a country plans and decides to do with its natural resources. At the end, when Malawi decides to sell any of its natural resources, it sells its natural resources to the highest bidder and uses it in a way it sees fit,” she said.
China has long been criticized for the exploitation of natural resources in African countries including Malawi. The Chinese Embassy in Malawi denies the allegations leveled that Beijing is in Malawi solely for the exploitation of its natural resources.
The Chinese Embassy issued a statement last year arguing that Malawi has benefited greatly from its relationship with China, pointing to the construction of the Malawi Parliament building, Bingu National Stadium, the Karonga-Chitipa Road in the northern region, the Bingu Conference Center and Hotel, the University of Science and Technology and the Presidential Villas as some of the benefits Malawi has gained from China as a result of their diplomatic relationship.
Following the China-Africa Summit in South Africa last year China said its commitment to Africa, including Malawi, will be to “implement cooperation in the ten major fields of industrialization, agricultural modernization, infrastructure, finance, green development, trade and investment facilitation, poverty reduction and people’s welfare, public health, people-to-people exchanges, as well as peace and security with Africa in the next three years” with a total of $60 billion in financial support.
For Malawi, China highlighted four pillars of assistance: infrastructure development, agriculture and food security, health care and education, and human resources. But the situation on the ground is little changed, especially in the agriculture, health and education sectors.
When the question was put to the Malawi Foreign Affairs Ministry why Malawi seems to remain the same since its recognition of and involvement with China began a decade ago, Shumba had this to say: “Firstly, you need to clarify the situation that has not changed on the ground. You may also wish to consider that recently Malawi was hit by climate change. Malawi had years of inadequate rain and then years of too much rain which led to floods and damage to crops and property. This can be one of the issues that might have affected agricultural production. On education, we have Malawi University of Science and Technology [built by China] and many scholarships for Malawians to study in China. Therefore, it is not correct to say things have remained the same.”
Former President Bingu wa Mutharika visited China shortly after establishing diplomatic relations. After returning, he told the nation that Malawi will not only benefit from aid but also China’s rich experience. He said it would help turn Malawi from poverty to riches. The country has since remained poor.
“No country can base its economic development on a relationship with one country,” Shumba argued, “There are so many variables which affect Malawi’s economic development. For instance, the fact is that Malawi is not industrialized and we rely heavily on agriculture. Therefore, Malawi as a Sovereign state has the full responsibility of working out how to get out of poverty. That is why the country is promoting skills development with the community colleges, value addition and establishing Agro Industries to increase our exports and reduce imports. You may also wish to note that Malawi’s poverty level has nothing to do with its relationship with China.”
The Malawi government admits that because Malawi is a landlocked country, it faces a number of challenges. The country is not industrialized, has inadequate skills, exports mostly raw materials, has an undeveloped tourism sector and has low energy access.
“These are issues that the government is working hard to address and the role of developed countries such as China is to assist,” Shumba admitted.
The other reason that prompted Malawi to abandon Taiwan was trade. According to official statistics in September 2008, just nine months after Malawi and China entered into a diplomatic relationship, trade between the two countries amounted to $59 million — a 120 percent increase compared to 2007. The Malawi government said trade between the two nations has remained encouraging, but President Peter Mutharika has on a number of occasions said Malawi needs to turn from being an importing nation to an exporting one “if we want to end [the cycle of] poverty.”
It was also the expectation of many that China would bring investments to Malawi and generate more jobs. Most of the infrastructure that China has put in place, such as roads and buildings, were mainly built by the Chinese and very few Malawians were involved.
One social commentator said that the Chinese were not really investors who came in the country to create jobs but small traders “who are in the country to render local traders jobless.”
The country is littered with many Chinese shops and restaurants but critics say those Malawians employed by Chinese enterprises are poorly paid. Chinese employers deny such allegations and say they are following all the country’s labor laws.
What is most worrying to many Malawians are the loans the country has accumulated from China. In 2016, Malawi and China signed an agreement for another round of project financing that will cost $1.79 billion in seven priority areas, according to the Ministry of Finance former spokesperson Alfred Kutengule.
These projects include a 300-megawatt power plant project amounting to $600 million, an e-governance project amounting to $500 million which will involve the laying of fiber optic cables for increased Internet connectivity, and the construction of new Chileke International Airport which will cost $285 million. These projects will be financed with loans from the Exim Bank of China, while the implementation will be done by China Gezhouba Group.
Mutharika has indicated that some of the projects will be financed through grants and soft loans but from the seven projects, three will be grants and the rest will be funded by loans that Malawians will have to eventually pay back.
China has also warned African countries that they should use the money from China on projects that are economical and contribute to wealth creation. The Director General of African Affairs in the Ministry of Foreign Affairs Lin Songtian told African journalists recently in Beijing that borrowing money should make economic sense.
Although China has been accused of ripping off Malawi, in particular, and Africa, in general, for its resources, some Malawians still believe that the arrival of Chinese traders has helped most poor Malawians by providing cheap products.
“Some of us are able to buy Chinese goods because they are cheap. So we are not complaining,” said Michael Mkwamba, a vendor in the city of Lilongwe.
Whether Malawians will be struggling with Chinese debt in the future, the fact remains that China has become Malawi’s diplomatic partner and will remain so in the years to come. Malawians are not worried about quality, per se; with all the infrastructure that is being built, the focus remains on quantity.
Raphael Mweninguwe is a freelance journalist based in Malawi and an MA student of Diplomacy and International Relations at the University of Diplomacy, Guidance and International Relations in Lilongwe, Malawi.