The Chinese tech companies which faced lots of resistance from the United States and some Western countries on the suspicion of spying or causing threat to their national security are finding new avenues for selling their technologies in Africa to maintain their global market share. The inroads that Chinese tech companies are making in Africa is possible because the countries of the continent are interested in developing their infrastructure in emerging industries.
This was evident in the China-Africa Economic and Trade Expo that took place in late June in Changsha, Hunan province. It could be seen that China and Africa are expanding the scope of their economic cooperation, which is being diversified from erstwhile thrust on trade and infrastructure to include cooperation in emerging industries such as digital, green and aerospace. In fact, it began much earlier than this event and already Chinese companies have participated in Africa’s digital infrastructure construction and development & promotion of e-commerce, mobile payment, media entertainment and other industries. The cooperation between China and the African countries was reconfirmed in the China-Africa Cooperation Vision 2035, which was passed in November 2021. According to the vision, the two sides reconfirmed their willingness to expand cooperation in various new areas such as spectrum management, 5G technology, satellite internet, big data, e-commerce and smart city.
The Chinese companies have built digital infrastructure in some African countries and this has bore fruits on ground including training and skill formation of African digital talents. Kilimali, established by a Changsha-based Chinese company in 2014 has become the largest e-commerce platform in East Africa with a vast number of users. Now the company plans to open five to ten more cross-border e-commerce business sites in Africa and build new overseas warehouses in Tanzania and Uganda this year. China is also cooperating with African countries in promoting agriculture with the help of drone technology from China, which has been introduced in the development of smart agriculture and digital transformation of agriculture in countries like Mozambique, South Africa and Ghana.
Another remarkable milestone is that China’s Huawei has established an academy in the University of Uganda relating to information and communication technologies aiming to introduce emerging technologies such as 5G, artificial intelligence and big data in the country. At present, the academy trains over 2000 technical professionals for Uganda every year. Huawei had also started its first RuralStar Lite base station in Zambia in 2019 to provide wireless network services in remote rural areas of the country. Now it is estimated that China has built over half of the African continent’s wireless sites and high- speed mobile broadband networks.
Standard Bank, a leading financial institution in South Africa, has embarked on a strategic collaboration with Huawei Mobile Services to provide cutting-edge digital banking solutions to its clients. As part of this collaboration, safety detect has been implemented to authenticate clients using the app, and a universal app downloads campaign has been launched, extending the world of digital banking to over 300,000 Huawei users. It is good that Chinese companies are developing digital infrastructure in the country and introducing new technology for smart agriculture and tech industries. The cooperation, however, could be more helpful if they are not based on exploitative terms and do not end up in data vulnerabilities. Africa needs digital infrastructure for efficient provision of ecommerce and other services including financial services. But some amount of caution is needed about the downsides of such cooperation.
The talk of caution about Chinese companies is not out of place. In 2017, a computer scientist discovered that China, which had built the computer network at the African Union (AU), had also built a backdoor that allowed it to transfer data from the AU’s headquarters in Addis Ababa, Ethiopia, to servers in China every night continuously for five years. In Africa, subsidiaries of Huawei own up to 70% of 4G networks across the continent, and Huawei already has a significant lead in building Africa’s 5G network. The US and some of its Western allies on the suspicion of exposure to Chinese surveillance labelled five Chinese telecommunication companies including ZTE Corps, Hikivision, and Huawei, as a “threat to national security.”
Africa needs support from China and other countries for the development of digital infrastructure, because with 17% of the global population its total available global data centre capacity is less than 1%. Chinese companies are not only forthcoming to build such infrastructure, but also to fund these projects at concessional rates. Huawei, for instance, is building multiple million-dollar data centres and cloud services across Africa, including in Mali, Madagascar, Mozambique, Tanzania, Togo, Zambia, and Zimbabwe. In this way Africa’s data would be greatly under Chinese control, and some analysts also fear that by such an overarching control China might also be able to export its digital governance style in Africa, which already has a fragile free-speech climate and dictatorial regimes.
African countries should aim at creating a competitive milieu in its digital infrastructure. There is no dearth of countries which could come forward to help build digital infrastructure and avoid the extreme vulnerability of putting all its data into Chinese control. Better it is to seek funds and technology and create its own data centre. Already the US government, through the Development Finance Corporation (DFC) has invested USD 300 million in South Africa-based Liquid Telecom’s Africa Data Centre while the European Union launched USD 340 billion in 2021 as an alternative to Chinese BRI. In the digital technology, Africa’s all-season friend, India has also huge expertise and capacity to help build digital infrastructure in the continent.