After neo-liberal capitalistic policies, China has become a major donor example to Africa and East Asia countries.China had
contributed billion (US$) to almost 800 projects in Africa. As China is a big emerging economy, the interest behind its huge
investment in Africa for four basic needs.
First, Huge amounts of power and resources for its industrial
development. It needs oil, minerals, agricultural and forestry resources to feed its rapidly growing economy.Second, the growing private sector needs areas of investment.Third, markets for its mass produced goods.Last, China needs to solve the huge employment problem.African governments and many East Asian countries welcome Chinese FDI (Foreign Direct Investment), especially in the construction of their infrastructure, even though they are tired of FDI, and are opposed to the so called developmentism led by the west (north).In the context of Nepal, China’s assistance is more of ODA (official development Assistance) rather than investment for industrialization.The Chinese policy of investment in developing countries is based on the win-win principle.Chinese aid has built a new type of strategic partnership based on mutual benefit, common development and win-win result in economic relations. Chinese aid comes in the form of cash and equipment grants, with extremely low interest rates (on which payment can be rescheduled without difficulties) and unilateral debt relief.Chinese labor, capital, and technology are increasingly visible in transportation, energy, mining, agro-business, eco-tourism and telecommunication. China needs huge amount of raw materials which Nepal can export and Chinese goods and investment for industrialization of the country can be imported.
November 2008
Rsing Nepal