China’s presence in Africa is paving the way for localization

China is “… much more committed to infrastructure development than any other outside actor.” – Editor, Think Africa Press

 

For generations, China has had a presence in Africa, but this presence has exploded in recent years. In fact, for close to 20 years, China has become Africa’s largest trading partner and a formidable investor in African infrastructure.

Want to take a closer look? Grab all tables in Google Sheets!

Want to take a closer look? Grab all tables in Google Sheets!

Although China accounts for nearly one-sixth of the approximately USD 30 billion in annual external funding for infrastructure, Africa still faces a number of challenges. The African population is approximately 1.3 billion with a median age of 19. This places an immense pressure on African economies to create and sustain jobs. Compounding this challenge, is the continued lack of digital infrastructure – including Internet access and electricity supply, but China invests heavily in these areas as well.

Lights, camera, action!

Huawei Technologies and Zhongxing Telecommunications Equipment Corporation (ZTE), two international telecom giants now provide service for hundreds of millions of Africans, offer competitive pricing, and beating out competitors. Tecno, a Chinese phone manufacturer, offers smartphones specifically geared to the African market. The phones boast a longer battery life, cameras that are more conducive to darker skin tones, and even dust particle-resistant screens.

According to the International Energy Agency, just under 600 million Africans are still unplugged. Chinese investment in sub-Saharan Africa has helped to develop the power sector and extend energy access contributing to economic growth, but there is still a long way to go.

Chinese investment – a rose with thorns?

But a young population and a lack of infrastructure aren’t the only obstacles to overcome. Some argue that bilateral trade is the driving force to Chinese investment, while others claim that a growing Chinese presence in Africa is more about the extraction of natural resources for manufacture in China, as well as a growing market for Chinese products, causing hardship to local businesses.

Critics also fear that China’s increasing economic stronghold on African countries creates a loss in local jobs and an increase in poor quality goods. China’s outward foreign direct investment (OFDI) now extends to 50 African countries, and their investment while diverse, seems to heavily favor manufacturing and extraction:

China's presence in Africa-China's Greenfield Project
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An investment in Africa’s infrastructure is only as strong as its investment in localization

International investment must accompany a localization plan, and the African landscape is the perfect example. Africa represents one-seventh of the world population. It not only consists of 54 countries but boasts nearly 2,000 active languages. With such linguistic and cultural diversity, each unique market requires specialized localization efforts.

African citizens, workers, business owners, and entrepreneurs are eager to access global information, enter the world market, and become international contenders. Investment in infrastructure is certainly a step in the right direction, but investment in localization will propel local businesses into the world of international commerce and attract even more global investors – a business opportunity not missed by African LSPs.

LSPs throughout Africa, including South Africa, Madagascar, Kenya, Uganda, and Egypt offer specialized language solutions that international investors require. Tecno has already localized its mobile operator software and applications into several African languages, and the need for language services will only increase in the coming years.

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Software companies, retail, hospitality, IT, and a slew of other international investors have their sights on Africa. International competition from Western Europe, North America, the Middle East, and Latin America continues to challenge Chinese investment efforts – but an investment in Africa’s infrastructure is only as strong as its investment in localization.

We’ve said it before, we’ll say it again, and we’ll keep on saying it – keep your eyes on the mother land.

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