The rising superpower has built up enormous holdings in poor, resource-rich African countries – but its business partners aren’t always thrilled, writes Brook Larmer
Every weekday before dawn, a migration takes place near the desert on Africa’s south-western coast.
At 5.30am in the Namibian enclave of Swakopmund, whose century-old buildings still bear the imprint of German colonisation, solitary men in khaki uniforms emerge from houses and apartment complexes.
They are not African but Chinese. No one else is stirring in the Atlantic coast town as the men converge on a house on Libertina Amathila Avenue.
Dylan Teng, a boyish 29-year-old engineer, is among the last to arrive. Just as he has done nearly every day since landing in Namibia three-and-a-half-years ago, Teng joins the others in wolfing down a breakfast of steamed buns and rice porridge.
At precisely 6am he boards a bus emblazoned with the letters CGN - China General Nuclear, a state-owned behemoth that owns the biggest Chinese project in all of Africa.
An hour later the bus descends to the Husab Uranium Mine, a €4.6bn investment. Teng has made this trip nearly a thousand times, but Husab always seems like a mirage: a virtual city stretching 11km across the desert floor, from two vast open pits being gouged out of the rocky substratum to a processing plant that, on the last working day of 2016, produced its first drums of the yellowcake that can be used to generate nuclear power (and also to make weapons).
One of the few university graduates from his village in China’s southwestern Sichuan province, Teng is keenly aware of Husab’s significance. It is not simply a lifeline for Namibia’s struggling economy, one that the country estimates will increase its gross domestic product by 5% when the mine reaches full production next year.
The uranium itself, almost all of which will go to China, will also help turn Teng’s homeland into a world leader in nuclear energy. In Beijing, where he worked before coming here, Teng lived under the gray blanket of coal-generated pollution.
Now he is working for the future — his own and his country’s — under an African sky of cobalt blue. “I never imagined I would end up halfway around the world,” he says.
China’s gravitational pull can be felt today in every nook of the globe. Few countries feel the tug more strongly than Namibia, a wind- swept nation with a population of 2.4 million.
The desert where the Husab mine has materialised in recent years used to be known only for the presence of Welwitschia mirabilis, the national plant that can live for more than 1,000 years. Now, in little more than 1,000 days, China’s reach has spread far beyond the uranium mine.
Just north of Swakopmund, a Chinese telemetry station sprouts from the desert floor, its radar dishes pointing skyward to track satellites and space missions.
Forty kilometres south, in Walvis Bay, a state-owned Chinese company is building an artificial peninsula as part of a vast port expansion. Other Chinese projects nearby include new highways, a shopping mall and a €400m fuel depot.
Driven by economics (a hunger for resources and new markets) and politics (a longing for strategic allies), Chinese companies and workers have rushed into all parts of the world.
In 2000, only five countries counted China as their largest trading partner; today, more than 100 countries do. Even as China’s boom slows down, its most ambitious scheme is still ramping up:
With the ‘One Belt, One Road’ initiative, President Xi Jinping has spoken of putting €1.6tn over the next decade into infrastructure and development throughout Asia, Africa and the Middle East.
For a nation like Namibia, China’s pitches can be irresistible partly because they’re rooted in historical solidarity. Beijing backed the black nationalist movement’s liberation struggle against apartheid and its white South African overlords.
Sam Nujoma, the leader of the South West Africa People’s Organization (SWAPO), visited Beijing in search of guns and funds in the early 1960s. When Namibia finally claimed independence in early 1990, China became one of its first diplomatic allies.
Besides direct investments like the Husab mine, China provides no-strings financing that, unlike Western aid, is not conditional on such fine points as human rights or fiscal restraint.
“We welcomed China very much because, for the first time, it gave us a real alternative to a Western-driven agenda, whether it was South Africa or the Western world,” Calle Schlettwein, Namibia’s minister of finance, told me.
“The Chinese say, ‘we want you to be masters of your own destiny, so tell us what you want.’” However, they have their conditions, too, he says.
“They want de facto total control over everything, so it’s difficult to bring about a situation that is truly beneficial.”
China’s leaders say its influence is entirely benign. And indeed, many of the projects Chinese companies are pursuing — roads and railways, ports and pipelines — might never be built without them.
China’s investment in the Husab uranium mine, in which CGN subsidiaries hold a 90% stake and the Namibian government owns 10%, is doing its part to stave off a recession.
“We helped Namibia gain its political liberation”, Xia Lili, a former Chinese diplomat who now works as an executive at a Chinese company in Windhoek, the Namibian capital, says.
“Now we’re helping it fight for economic emancipation.”
For some Namibians, however, the flood of Chinese loans and investments doesn’t look so much like freedom as it does a new form of colonialism. The infrastructure is welcome, but as projects financed by the Chinese loans they have saddled the economy with debt.
Over the last few months, moreover, a series of scandals involving Chinese nationals — including tax evasion and poaching endangered wildlife — has soured locals on a foreign presence that can seem largely extractive: pulling uranium, rhino horns and profits out the country without benefiting a population that ranks among the most unequal economically in the world.
The sign on the lime green cement wall outside the restaurant, written in Chinese, read “Ye Shanghai”: “Shanghai Nights.”
Inside, six middle-aged Chinese men and women — including James Shen and his wife, Rose, the proprietors — crowded around a table peeling prawns and sucking heartily on the shells.
Blaring from the television on the wall was a special report on CCTV-4, a channel from China’s state television broadcaster, describing the powers of the People’s Liberation Army.
The couple’s restaurant is in Walvis Bay, a port surrounded on three sides by the Namib Desert. James and Rose are part of the early wave of Chinese immigrants who landed in Africa 20 years ago and never left.
“My husband came to look at business here, and he fell in love with the wide-open spaces,” Rose told me. “But we’re still Chinese first and foremost.”
Like many Chinese immigrants around the world, the couple began by opening a small shop, filling the shelves with cheap clothes, shoes and bags shipped by container from China. Their store, James and Rose, still stands at a central intersection of Walvis Bay, even as their ventures have expanded to include a hotel, a restaurant, a karaoke bar, a massage parlour and a trading company. Today there are such Chinese-run stores in nearly every town in Namibia. One of the most influential Chinese immigrants in Namibia, Jack Huang, parlayed a small textile business into a mining, real estate and trade conglomerate. A 49-year-old native of Nantong, a city located about two hours northwest of Shanghai, Huang moved to Namibia nearly two decades ago.
Huang’s success has come, in part, from cultivating connections with Namibia’s political elite. SWAPO, the guerrilla-group-turned-political-party, has dominated Namibia’s elections since its independence. Huang has referred to Nujoma, Namibia’s founding father, as “my special adviser”.
During the 2014 election campaign, Huang and the SWAPO candidate Hage Geingob (then the prime minister, now the president) attended a gala dinner at which, according to local reporting, the Chinese businessman pledged Geingob’s political party a donation of 1 million Namibian dollars — about €90,000. (Huang denies this.)
Huang’s friends prefer to emphasise how much he has given back to his host country through his charity, the Namibia-China Loving Heart Organisation. (Huang was out of the country at the time of my visit, but he authorised two deputies to speak with me on his behalf.)
Last year, however, the local media revealed that before Geingob was elected president in 2014, Huang was the owner of a majority stake in a real estate venture whose only other shareholders are Geingob’s family trust and ex-wife. The men tried to distance themselves from each other in the press.
Still, Huang’s friends worry about his courting of the powerful. “I kept warning Jack,” says one businessman who occasionally socialises with Huang. “‘Don’t get too close to the fire. You’ll burn your fingers.’”
As a load-and-haul engineer at the Husab mine, Teng helps choreograph 26 gargantuan trucks. So far, the trucks have hauled more than 100 million metric tons of rock out of Husab’s open pits.
As production increases this year, far more will be needed to process the 15 million pounds of uranium oxide that the mine aims to produce annually. “The pressure is always on to stockpile enough so the processing plant never runs out of rock,” Teng says.
As its economy has slowed recently and commodity prices have plunged, China has sharply reduced some of its imports, causing a few boom areas, like Western Australia, to go bust.
With uranium prices at less than half their level before the 2011 nuclear disaster in Fukushima, Namibia’s two other active uranium operations have stopped digging up rock and process only already-stockpiled material. However, Husab forges ahead, hiring many of the hundreds of workers laid off at those other mines.
There is a simple reason that CGN can afford to ramp up production at Husab: It is selling most of the uranium to itself, the Chinese state, so price is almost irrelevant. An even bigger reason is China’s ambition both to reduce its carbon emissions and to become a world leader in nuclear power.
Nearly 88% of China’s energy now comes from fossil fuels, only 1% from nuclear power. (Solar, wind and hydropower account for the remaining 11%.) To reach its clean-energy goals China has put nuclear power back on an almost impossibly fast track.
The country now has 37 nuclear reactors, with another 20 under construction, and it aims to have 110 reactors by 2030. This rate of growth, six new plants each year, would catapult China past the United States as the world’s top nuclear power, but it also raises concerns at home and abroad about whether China’s safety standards can keep pace.
CGN did not allow me to visit the mine or interview its managers, claiming that they were too busy increasing production. To get a glimpse of the complex, I drove down a back road to the highland plain where the Welwitschia mirabilis grow, near Husab’s back gate.
Before construction began at Husab in 2013, the company transplanted four rare Welwitschia specimens that would have been destroyed — a symbolic gesture in a country that reveres the ancient plant.
Since then, CGN has seemed eager to dispel the uncaring reputation that Chinese state-owned companies have earned: It has made donations to drought victims, offered scholarships to local engineering students and, in a first for a Chinese company in Namibia, even invited a local labour union to set up shop at the mine site.
Husab is a tangible, direct investment, but most Chinese projects in Namibia and around the world are financed by soft loans that carry risks. Last year, China established a new €60bn fund to finance infrastructure projects in Africa, mostly with Chinese lending.
The projects can be essential, but most of the loans stipulate that a Chinese state-owned company must take the lead, ensuring that the work and profits are kept largely in the Chinese family. Countries like Namibia are left holding the debt.
Schlettwein, the finance minister, told me, “I don’t think those are real investments, but opportunities latched onto by Chinese enterprises without really adding value to the Namibian economy.”
Such criticism irritates Chinese business owners and diplomats, who point out that Chinese companies have invested more than €5bn in Namibia and now employ more than 6,000 Namibians.
“We’re here to do business on an equal footing with the locals,” says Xia Lili, the former diplomat who is deputy general manager of Huang’s Sun Investment Group and secretary-general of the Namibia-China Loving Heart Organisation.
“We bring in money to establish mines and factories. Who benefits? The Namibians. Did the Western powers ever do this? Not nearly as much. So this talk of new colonialism is untrue.”
Namibia is starting to push back. Last year the government pulled out of a €570m loan agreement with a state-owned Chinese company to expand the Windhoek airport.
Then in September, as sluggish growth and other foreign loans pushed Namibia’s debt to over 40% of its GDP, the government suspended all new loan tenders. Schlettwein says the freeze was an act of belt-tightening, not a move specifically targeting China.
Nevertheless, he says: “It sends out a signal that Namibian interests are not to be trampled on indiscriminately. It sends a signal that our relationship must mature.”
One morning in late December, the Namibian conservation biologist Chris Brown was working in his Windhoek office when he heard a banging at the gate. Rushing out, he found two angry Chinese men in button-down shirts: the first and second secretaries from the Chinese embassy.
One of them threw a letter through the gate, Brown says, and shouted: “These are lies! You are making China look bad in the eyes of the world!” The pages were the same ones Brown hand-delivered to the Chinese embassy two days before — and then sent to other diplomatic missions, media outlets and international organisations.
Signed by 45 local environmental groups, including Brown’s own Namibian Chamber of Environment, the letter blamed Chinese nationals for a sharp surge in the commercial poaching of wildlife in Namibia — and excoriated the embassy for doing little to stop it.
Over the last two years, Namibia has lost nearly 200 elephants and endangered rhinos to poaching. In November, a Chinese smuggler was caught in the Johannesburg airport with 18 rhino horns — all from Namibia. (Rhino-horn powder is an ingredient in traditional Chinese medicine that is believed to strengthen the immune system.)
China is not the only culprit in the €19bn illegal wildlife trade. However, its growing hunger for the exotic and dubiously curative is devastating worldwide populations of rhinos and elephants, sharks and tigers.
Huang Hongxiang, a former journalist from China who investigated ivory and rhino-horn poaching in Namibia, has started a Kenya-based nonprofit organisation, China House, to help Chinese companies and communities engage in wildlife conservation as a form of corporate social responsibility.
“In a lot of global environmental issues, Chinese are part of the problem, so they have to be part of the solution” he says.
“Three months after Brown’s letter provoked the indignant response, the Chinese embassy hosted a meeting of Namibian activists and some 60 Chinese business leaders. Besides trumpeting China’s recent ban on all ivory sales, the acting ambassador, Li Nan, denounced poaching and lectured Chinese nationals about obeying Namibian law.
Huang also spoke out against poaching, but a different kind of dragnet was closing around him. On February 1, the tycoon and four others (three of them Chinese) were arrested at Windhoek’s international airport for their participation in a supposed tax-fraud scheme that netted nearly €300m — the largest case in Namibian history.
The arrests were part of a two-year investigation into more than 30 Chinese companies accused of concealing illegal earnings. While in custody, Huang reportedly tried to contact Geingob, but his business partner declined to help.
In mid-February, soon after Huang’s release on €75,000 bail, he claimed that the tax-fraud case against him was based on outdated information. Xia, his deputy at Sun Investment, told me that Huang divested from Golden Phoenix, a company named in the case, more than eight years ago, but that the transaction had not been entered into the official computer system. When this trial is over, Huang may file lawsuits against those who attacked his businesses, Xia says.
As the afternoon sun weakens over the Husab Uranium Mine, most of the 2,000 or so Namibian workers return to their desert barracks. Teng and the other Chinese engineers board buses for the ride back to Swakopmund. After sharing another Chinese meal together, the men disperse. Teng walks back to his apartment, where he will spend a few hours on his computer doing administrative and supervisory tasks.
“Our real secret is that we work 12-hour days while everybody else works eight,” Teng says.
Saving more in Namibia than he could in China, Teng has built a tidy nest egg. In 2014, when a CGN delegation from China visited Husab, Teng chatted with one of the two women in the group. Online flirting ensued. In January, Teng returned from a trip to China with a ring on his finger. He’d married the visitor — mission accomplished. Teng’s other goal has not yet been achieved. He wants to see Husab reach its full potential next year, fuelling China’s continued rise.
The Chinese migrants who have gone out into the world, the risk-takers who have found spots in Asia, Latin America and Africa, are as diverse as China itself: young and middle-aged, unschooled and highly educated. They are not a monolith.
What binds these individuals together is an abiding belief that their presence overseas is making China better and stronger. This shared conviction, as much as the state that has nurtured it, is what makes China a colossus, a nation that can be seen by others, in the same instant, as a blessing and a curse.
Brook Larmer is a contributing writer for The New York Times Magazine. Adapted from an article that originally appeared in The New York Times Magazine
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