This article by Oussama Dhiab critically examines China’s Belt and Road Initiative (BRI) as a “soft” platform for win-win cooperation, highlighting China’s shifting foreign policy in North Africa, the perceived inequities in economic and infrastructural partnerships under the BRI framework and the need for African countries to assert agency to ensure that markets are regulated and that trade agreements support African interests.
By Oussama Dhiab
Following the Arab revolutions, North African countries experienced a state of disengagement from former colonial powers. Numerous issues, such as sovereignty, national decision-making, economic exploitation, and cultural hegemony, became central to the debate in Arab public opinion. Simultaneously, this presented a valuable opportunity for China to present an alternative offer, with a narrative based on mutual respect and the principle of win-win cooperation. The Belt and Road Initiative (BRI) was the most suitable framework for this new “offer”. There is no doubt that Chinese soft power plays a major role in promoting the “Belt and Road Initiative.” However, additional evidence indicates the limitations of this policy, or at least the beginning of its change. In this paper, I will try to expose the idea of the limits of Chinese soft power as well as the win-win principle of this cooperation
1- Limits of China Soft Power in North Africa
The unexpected uprisings in the Arab world caught the Chinese government and investors by surprise. The initial response from the Ministry of Foreign Affairs was a “wait and see” policy, especially since no one could predict which regime would fall next.
Especially since Western intervention and the changing of regimes in countries that have had historical relations with China, such as Algeria, Egypt, and Syria, could bring about pro-Western regimes that align with Western positions, potentially harming Chinese interests. China fears that Western intervention could transform the region from sovereign states into entities subservient to American hegemony.
The Syrian revolution, for example, represents a threat to China’s interests considering it is located in a geographical area adjacent to Chinese influence and could bring about regimes more aligned with American interests in the region. Furthermore, the rise of Islamic-oriented movements in Tunisia, Egypt, Syria, and Libya (despite their varying nature) might fuel the ideology of separatist Islamic movements in Xinjiang. Thus, we witness this shift from the principle of “peaceful development” to the notion of “responsible power.”
Consequently, the central government had many reasons to be concerned and wary of the “Jasmine Revolution.” The wave of uprisings of the so-called “Arab Spring” seemed to engulf all repressive countries in North Africa. Destabilization in these countries not only threatened China’s fragile commercial interests abroad but also posed a potential threat to the regime of the Chinese Communist Party (CCP) within its own borders. Chinese analysts considered the links between the security of North Africa and China, and the potential actions Beijing could take to promote stabilization in the region.
The debate on China’s role in North Africa and the unprecedented activism in the region has turned into an ongoing discussion about the need to modernize China’s traditional foreign policy, including its adherence to the principle of non-interference. Some researchers have adopted a more pragmatic approach to the concept of non-interference and proposed new ideas that attempted to complement it with a solid theoretical framework justifying Chinese activism in foreign diplomacy as a natural and legitimate evolution. For example, in 2010, Zhao Huasheng from Fudan University proposed the idea of “constructive intervention” (建设性介入 Jianshexing Jieru), suggesting that China could enhance its credibility as a reliable actor by acting as a peacemaker in a regional crisis and cooperating with major powers to address local instability.[1] Beijing has always linked the concept of stability with sovereignty and territorial integrity. If we take Libya as an example, Beijing’s primary concern seems to be that Libya could eventually fragment into separate states, which goes against China’s traditional emphasis on the importance of sovereignty in managing security crises. In 2011, Foreign Minister Yang Jiechi emphasized this point: “the sovereignty, independence, unity and territorial integrity of Libya,”
Indeed, there has been a noticeable shift in Chinese foreign policy in recent years. Beijing’s response to the Arab uprisings has evolved from a passive stance of ambiguity to a position of action, albeit still cautious. This shift was motivated by the high cost of a wait-and-see policy and the potential consequences for China’s political and commercial interests. Many examples in the region support this paradigm shift, which challenges the notion of Chinese soft power and its principle of non-interference. The most striking example is that of Libya. The internationalization of the Libyan conflict and the increasing inability of the Gaddafi regime to ensure the security of investments and foreign nationals pushed for a change in China’s policy of non-interference. Since some of China’s investments and projects in Libya resulted from bilateral agreements with Gaddafi rather than simple commercial contracts, they were vulnerable to regime changes. With several of its state-owned enterprises, such as CNPC and China Railway Construction Company, winning significant contracts, and over 75 other Chinese companies operating in the country, and nearly 35,000 Chinese nationals in Libya,[2] strict adherence to its foreign policy, the principle of non-intervention in the US/NATO backed intervention in Libya, was tested by China. The above factors combined to pressure Beijing to act to protect both its foreign investments and its nationals in Libya.[3] Following this situation, the People’s Liberation Army Navy helped evacuate nearly 35,000 Chinese workers from the country before the start of NATO airstrikes. These factors also compelled China to consider political instability in Africa as threatening its interests, shifting its perception of intra-state armed conflicts in Libya from that of a non-threatening internal issue to a threat. This led to a reconsideration of its approach of absolute non-intervention in the US/NATO intervention in Libya .
What proved to be a challenge for Beijing was the need to find a balance between protecting its interests in Libya and maintaining its foreign policy of non-interference in the internal affairs of other states. This is where Chinese pragmatism came into play. From passive and tepid statements urging parties to the Libyan conflict to resolve their differences through dialogue, Beijing moved towards experimenting with both multilateral and bilateral actions aimed at protecting its interests in Libya. In particular, it viewed multilateral interventions as a discreet intervention option that struck a delicate balance between its identity as a non-interventionist power and intervention to protect its threatened nationals and investments in Libya. Beijing opted for a UN-led multilateral intervention. Another example that confirms this shift from soft to hard power is the joint Sino-Russian military exercise that took place in the Mediterranean in 2015, as well as the opening of China’s first overseas military base in the Red Sea near Egypt in Djibouti. Additionally, in January 2018, two warships from the 27th Chinese naval escort fleet made a friendly stop in Algiers for a four-day visit as part of a four-month tour.
2 – Is BRI a win-win partnership between China and North Africa?
The European Union has always expressed a Eurafrican imperial viewpoint, emphasizing economic interdependence and complementarity through an amnestic approach to the Arab Mediterranean. The EU’s free trade agreements, such as the DCFTAs, it embodies a new Western-centric thinking regarding the issue of development and establishes a new neocolonial mindset, aims to transfer and enforce its trade norms on its former colonies in the Arab Mediterranean and beyond and continue to enforce the subordinate economic status of African countries by hindering effective strategies for economic diversification and industrialization through premature liberalization.
The North African disillusionment with former colonial powers after the Arab revolutions, coupled with the desire to break free from this cultural and economic hegemony and diversify markets, has made China an increasingly sought-after country for trade, construction, investments, diplomatic consultations, and even security operations. By establishing close ties with Africa, China is expanding its interests and deepening its presence in the region. In accentuating its presence, China tries to maintain its political neutrality regarding regional conflicts and controversies, notably by adhering solely to soft power tools. This flexible and pragmatic strategy allows China to become increasingly active on the diplomatic front, establishing various cooperation platforms, such as the Sino-African Forum, the Sino-Arab Forum, and recently within the framework of the Chinese mega project “一带一路” (yidai yi lu) or “the new Silk Road.”
In this regard, the Belt and Road Initiative has provided three significant advantages for North African countries. Perhaps the most important is escaping the suffocating grip of the United States and the European Union. Secondly, it allows for the diversification of export markets and the attraction of more Asian investments. Finally, it reflects a desire to establish a cooperative partnership with a major Asian country without a colonial past. In fact, for North African countries, China appears as a counter-model, even to be the most welcomed development model in Africa compared to the European models according to surveys conducted by Afrobarometer [4], due its foreign policy based on respect for national sovereignty, territorial integrity, and recognition of the ruling regimes. Its diplomacy favors win-win partnerships, dialogue, negotiation, non-interference, respect for international regulations, and the rejection of sanctions and conditionalities, known as the “no strings attached” approach.
North African countries, which suffer from low connectivity across their territories, have sought to leverage the Chinese Belt and Road Initiative to enhance their infrastructure. In Egypt, among these mega projects, there is the New Economic Belt project for the Suez Canal corridor, the New Administrative Capital project, the Golden Triangle project, and various roads, bridges, tunnels, and land and seaports, as well as traditional and renewable energy projects. Algeria, a historic partner of China, has greatly benefited from Chinese expertise in improving the country’s infrastructure. Dozens of mega projects have been completed in just a few years, including the East-West Highway, the new Algiers airport and terminal inaugurated in April 2019, the largest mosque in Africa in Algiers, the Olympic stadium in Oran, the Ministry of Foreign Affairs, and the Constitutional Court in Algiers. Other projects have been implemented to expand the railway network, such as the construction of a 750 km aqueduct connecting In Salah to Tamanrasset in southern Algeria, among others. Tunisia has also sought Chinese expertise to build a solar power plant aiming to develop at least 835 megawatts of solar power by 2030. Other significant projects undertaken by China include the cultural sports center in Ben Arous and the diplomatic academy in Tunis.
Although some important infrastructure projects, cooperation seems to be more beneficial for China. This imbalance, which we will analyze, leads us to question any discourse of “partnership,” “cooperation,” or “win-win.” Taking Algeria as a case study, we observe that firstly, the trade balance favors China, and the Algerian state finances most of the projects undertaken by Chinese companies. Chinese foreign direct investment (FDI) in Algeria represents only 6 percent of Chinese FDI in Africa.[5] Secondly, there is very little technology or expertise transfer from the Chinese side, as Algerians have limited access to management positions. [6] This is due to assigned employment quotas that do not specify the types of positions Algerians are supposed to hold in joint projects. Consequently, Algerians tend to hold blue-collar positions such as janitors, security guards, drivers, etc., meaning low-cost local labor. Graduates in Algeria seem to have limited access to Chinese companies. The contribution of Chinese companies to reducing unemployment remains very limited. In a country where a high number of university graduates are unemployed, figures indicate that three-quarters of graduates remain jobless, with an even higher rate among less educated workers.[7] Thus, Chinese presence in Algeria mainly benefits the groups of workers who suffer the least from unemployment. Additionally, these workers often receive minimum wage, around 117 euros, indicating that the contribution of Chinese presence is somewhat limited and not very adequate to Algerians’ expectations regarding the issue of unemployment.[8] Moreover, the growth capacity of the Algerian private sector is hindered by the presence of giant Chinese state-owned enterprises. Small and medium-sized private enterprises struggle to compete with well-established Chinese companies, which end up winning most bids and signing the majority of contracts. Thirdly, construction agreements with Chinese companies mostly have a limited impact on the economy in terms of job creation. Despite regulations requiring the employment of Algerian workers, the majority remain Chinese. There is no control over the implementation of employment policies, as the Algerian government sought quick solutions to solve the housing crisis, one of the causes of social unrest in the 1990s. For example, when the US$1.1 billion project for the Algiers mosque was signed, Algeria and China agreed that out of the 17,000 jobs generated by the project, 10,000 would be reserved for Algerians. However, reports indicate that at least 10,000 Chinese workers were on site at the project’s outset.[9] The high skill and efficiency of Chinese workers were cited by both parties to justify such a violation.
The issue of job displacement seems to be a very concerning issue in countries where China has mega-projects such as Egypt and Algeria. As for Tunisia, despite the official interest in the New Silk Road initiative and the “total support” for this project, as highlighted by the Minister of Foreign Affairs Khamis Al-Jhinaoui, there is a real gap between aspirations and reality. Chinese presence in Tunisia remains very modest compared to neighboring countries.
This difference in Chinese presence in North Africa is linked to historical factors. Unlike other North African countries, Tunisia had a unique stance in recognizing Taiwan, which led to a stagnation in relations between the two countries for a period of time. The relationship between the two countries is centered more on cultural and human aspects than political ones, which often links Chinese presence in Tunisia to teaching Chinese language or Chinese tourists, despite some assistance in infrastructure development.
Economically, Tunisia’s main export markets are still European markets. Despite efforts to diversify the economy, the EU accounts for over 50% of Tunisia’s imports and exports. France is its main trading partner, accounting for 30.6% of exports and 15.1% of imports.[10] Italy comes second, followed by Germany, Spain, and Turkey. There are only 10 Chinese companies operating in Tunisia, with a combined annual turnover of around US$10 million, while there are over 4,000 European companies.[11] With a small operating capacity of only 548 jobs according to the Ministry of Foreign Affairs’ figures.[12] Despite the signing of many trade agreements and the establishment of mechanisms such as the China-Tunisia Cooperation Forum and the Tunisia-China Investment and Trade Forum to strengthen bilateral relations, total trade between the two countries has remained low. In 2017, the total volume of trade between the two countries reached only $1.5 billion.[13] However, there is a significant gap between Tunisian imports and exports to China. This has led to an exacerbation of Tunisia’s trade deficit with China, where the deficit recorded in 2015 and 2016 reached 99%.[14]
In return, and despite the criticisms that may be directed at the European Union, Tunisia’s trade balance with the European Union (EU) was in surplus by the end of August 2023, reaching 5.9 billion dinars, according to the latest statistics from the National Institute of Statistics (INS) on foreign trade at current prices for the first eight months of the year 2023.
This surplus is the result of an increase in exports, which reached 28.8 billion dinars, while imports slowed to 22.9 billion dinars. Tunisia’s exports to the EU, which account for 71% of total exports, increased by 15.2%, while imports, which account for 43.4% of total imports, decreased by 7.8%.[15]
The flow of Chinese products has touched every sector without exception, with dominance in electrical equipment, representing 53% of Tunisian imports from China, valued at 2295 million dinars.[16] In second place are textile imports, metals, and manufacturing industries, valued at 1018.3 million dinars, and finally, cars and mechanical equipment exclusive to the European exporter, valued at 239 million dinars in 2017, representing 5.5% of Chinese exports to Tunisia.[17] On the Tunisian side, the majority of exports to China (with a total value of 72.3 million dinars) consist of mineral or chemical raw materials and low-value-added agricultural products.
While China has benefited from Tunisian consumerism to promote its exports to Tunisia by 100% in recent years, the Tunisian side, due to economic slowdown and decline in both national and foreign investments during the same period, has not been able to expand its presence in the Chinese market. Faced with China’s continued growth in the domestic market, reaching 8.9% in 2017, Tunisia has been unable to capture more than 0.012% of the total Chinese market, which amounted to 3.6 trillion dinars, according to indicators published by the World Trade Organization.[18]
Of course, there are many criticisms regarding the nature of the division of labour and the composition of exports between North African countries like Tunisia and Algeria on one hand and the European Union on the other. However, what I mentioned above, I believe, is necessary to think rationally about the question: Is China a genuine partner and fundamentally different from traditional hegemonic powers? At least in terms of trade exchanges and the nature of the division of labour, it doesn’t seem to be very different.
It is important to note that since the launch of the BRI initiative in 2013, the curve of Chinese exports to Tunisia has continued to rise, while Tunisian exports have remained stagnant, similar to neighboring countries. However, the discourse promoting the BRI was often based on a narrative of Win-Win for a project supposed to offer more opportunities for these North African countries.
The trade deficit extends beyond official channels to include parallel trade and smuggling. Chinese products are the most common to evade Tunisian land and sea ports, resulting in huge customs losses for the state each year, which, according to a report published by the World Bank in 2014, amounted to approximately 500 million dinars.[19] The same report indicated that the value of smuggled goods from Libya and Algeria, including electrical and mechanical equipment, electronic devices, and textiles, is about one billion dinars per year. The enormous difference between Chinese investments totaling 12.9 million dinars and the value of Chinese exports to Tunisia (4330.6 million dinars) partly reflects the strategy and limitations of the economic relations drawn by the Chinese. Chinese businessmen still view the Tunisian market as a limited, expensive, and insecure market for direct investment but welcoming for products from China. Conversely, the Chinese market remains inaccessible for a Tunisian economy mired in crises due to debt and declining production.
Tunisian officials and business circles interested in integrating Tunisia into the BRI have always tried to promote Tunisia as a gateway to the European Union and its markets, emphasizing that Tunisia is the first country in the southern Mediterranean to have obtained a free trade agreement with the EU. However, China seems less motivated and discouraged for some reasons.
This imbalance is not only related to the trade balance; As for tourism, despite the steady increase in the number of Chinese tourists coming to Tunisia following the cancellation of visas for tourist groups, this is accompanied by many difficulties faced by travel agencies in Tunisia. Ben Hassine talks about a certain hegemony of Chinese tour operators in the tourism sector:
We see a change in Chinese behavior regarding the tourism sector. At first, we were on equal footing with them, but in recent years, we noticed a desire to dominate the market, and this phenomenon is increasing day by day. The competition imposed by Chinese tour operators is fierce. This leads to an irrational decrease in prices. If you are not able to lower prices, you will lose the markets to the Chinese tour operator.[20]
Regarding other North African countries, Morocco has made remarkable progress in its trade relations with China as it has become its third supplier. However, ultimately, the distinctly asymmetrical nature of this cooperation characterized by a heavily imbalanced trade balance persists, with Moroccan products remaining very limited in China. This deficit has widened due in particular to the increase in imports of capital goods and intermediate goods from China. Taking the example of the textile and clothing sector, which represents nearly 38% of jobs in the industry. As a producer and exporter of textiles, Morocco has suffered the consequences of the termination of the Multifiber Agreement at the end of 2004, which liberalized global trade in clothing in favor of China. The rise of Chinese textiles first occurred in the EU market and then in the local market. This phenomenon has destroyed nearly half of the jobs in the industry in both Morocco and Tunisia. These two countries are indeed traditional suppliers to the European Union and have not yet managed to face Chinese competition.
Conclusion
The Chinese Belt and Road Initiative coincided with the emergence of an anti-colonial rhetoric in North Africa. The Arab revolutions paved the way for disengagement from former colonial powers. Many issues, such as sovereignty, national decision-making, economic exploitation, and cultural hegemony, have become subjects of intense debate in Arab public opinion. It was within these circumstances that China presented an alternative offer based on the discourse of sovereignty, respect, and mutual gain. Many promises were attributed to this initiative. China’s increasing demand for natural resources has always been seen as an opportunity to industrialize the economies of North African countries, for technology and expertise transfer, for improving the region’s infrastructure, for promoting small and medium-sized enterprises, for investments, and especially for combating unemployment. Ten years after the launch of such a large-scale project initiative, it is premature to evaluate its impact and draw conclusions as much remains to be done. While it is true that, in countries like Algeria and Egypt, the Chinese have built much-needed infrastructure to improve connectivity, on the other hand, this initiative tends to boost the tourism market in Tunisia and Morocco. In return, the expansion of Chinese presence through the Belt and Road platform has caused painful restructuring of some of the most vulnerable and job-generating sectors in the region, such as textiles for Morocco and Tunisia.
Chinese policy towards North African countries has theoretically shifted from South-South solidarity and its ideological drivers to a more utilitarian logic, primarily aimed at ensuring the sustainability of China’s economic growth. State-owned enterprises (SOEs) are among the main drivers of this growth. There is a type of mutual benefit involving Chinese capital owned large companies, as these companies adhere to the broad guidelines set by the CCP in its policies. In return, these companies benefit from Chinese state projects abroad. China’s state-owned companies themselves provide opportunities for small and medium-sized Chinese enterprises, which are economic actors governed by the logic of capital accumulation and maximum profit.
This transformation, in my view, is also rooted in the changes within the Chinese governance system. China has moved from a phase characterized by centralized rule by the Communist Party and the state, driven ideologically, to a new stage where multiple factors shape Chinese foreign policy. These factors range from the Communist Party to Chinese banks, state-owned enterprises, as well as medium and small private companies, and even Chinese immigrants with their small businesses. These entities are governed by highly interconnected relationships that sometimes intersect and sometimes diverge. However, they undoubtedly contribute to shaping a new, more pragmatic Chinese policy that gives greater margin to capital interests.
This has resulted in a trade imbalance between North African countries and China. It should not be forgotten that the low investment rate, the few jobs offered, and the stagnant projects of promoted industrial zones make the visibility of a better future unclear. Finally, North African countries must ensure that this cooperation allows them to build their own diversified economies and not remain suppliers of raw materials. African countries must ensure that markets are regulated and that trade agreements are in favor of African interests. Otherwise, this partnership, born in circumstances of national emancipation for North African countries, and which seems imbalanced in its inception, may lead to a new form of hegemony.
Oussama Dhiab is a PhD political science candidate in the University of Tunis, China Studies researcher and a Teaching Assistant and Carthage University.
Featured Photograph: Table Bay Harbour, Cape Town, South Africa (11 August 2017).
Notes
[1] Zhao,(H). “Noninterference in internal affairs and constructive involvement — reflection on Chinese policy”, Xinjiang Normal University Journal—Philosophy and Social Science 32, no. 1 ,2011, pp23–9.
[2] Engelbrekt, (K)., & Wagnsson, (C). “Introduction. In K. Engelbrekt, M. Mohlin, & C. Wagnsson (Eds.), The NATO intervention in Libya: Lessons learned from the campaign”,New York: Routledge , 2014, pp. 1–14.
[3] Engelbrekt, (K). “Why Libya? Security Council Resolution 1973 and the politics of justification”. In K. Engelbrekt, M. Mohlin, & C. Wagnsson (Eds.), The NATO intervention in Libya: Lessons learned from the campaign, London: Routledge, 2014, pp. 41–62.
[4] The African barometer 2014-2015 survey
[5] Ghannem, D , Benabdallah, L. “Algiers and Beijing have improved their economic ties, but Algeria can certainly benefit more.” Carengie middle east center, 18 November, 2016: https://carnegie-mec.org/diwan/66145
[6] Méditerranée. Revue géographique des pays méditerranéens / Journal of Mediterranean Geography. (2013, December 30). L’Algérie made by China. Retrieved June 23, 2024, from https://journals.openedition.org/mediterranee/5468
[7] National Office of Statistics (Algeria), 2011, Activity, Employment, and Unemployment in the 4th Quarter of 2010.
[8] African Development Bank Group. (n.d.). Publications. Retrieved June 22, 2024, from https://www.afdb.org/en/documents/publications
[9] National Office of Statistics (Algeria), 2011, Activity, Employment, and Unemployment in the 4th Quarter of 2010.
[10] Nordea Trade (2019), ‘Tunisia: Economic and Political Overview’, https://www.nordeatrade.com/en/explore-new-market/tunisia/tradeprofile
[11] Ghanmi, L. (2018), ‘Tunisia joins China’s Belt and Road Initiative as it seeks to diversify trade, investment’, The Arab Weekly, 9 September2018,
https://thearabweekly.com/tunisia-joins-chinas-belt-and-road-initiative-it-seeks-diversify-trade-investment
[12] العلاقات الثنائية بين جمهورية الصين الشعبية و الجمهورية التونسية” Bilateral relations between the People’s Republic of China and the Republic of Tunisia.
https://www.diplomatie.gov.tn/fileadmin/user_upload/pdf/LES_RELATIONS_TUNISO-CHINOISES_ar.pdf
[13] World Bank (n.d.), ‘World Integrated Trade Solution, China Exports/Imports by Country, 2018’, https://bit.ly/2RacJ52, https://bit.ly/365rb2l
[14] Figures from the WHO. https://oec.world/en/profile/country/tun/
[15] Accueil. (n.d.). Statistiques. Institut National de la Statistique – Tunisie. Retrieved June 23, 2024, from https://www.ins.tn/statistiques/50
[16] Mohammed Samih Beji “العلاقات التجارية بين تونس و الصين “Trade relations between Tunisia and China., Nawat, 8 april 2019
https://urlz.fr/dUFc
[17] Ibid
[18] Ibid
[19] Ayadi (L), Benjamin (N), Ben Sassi (S), Gaballand (G) «Estimating Informal Trade across Tunisia’s Land Borders» The World Bank policy research paper, December 2013 http://documents1.worldbank.org/curated/en/856231468173645854/pdf/WPS6731.pdf
[20] Interview conducted by the author with Wissem Ben Hassine.
