FDI in Africa: A Comparison of the Indian and Chinese Experience

Abstract

Over the last decade there has been a gradual but marked shift in the main donors of FDI funding for Africa from the traditional western developed countries to the BRICs nations. India and China in particular have become significant players in the continent. How far this altered trade and investment relations is assisting the creation of opportunities or posing new challenges for the African economy has attracted considerable scholarly and government attention. While it is obvious that any increase in FDI is welcomed by Africa as it helps boost economic growth and development, there are also concerns about the exploitation of natural resources. It is against this backdrop that this paper seeks to investigate the nature and trend of foreign direct investments made by India and China in Africa, over the past decade. While comparing the quantitative data, the focus will be on revealing similarities and dissimilarities in the patterns of development cooperation of the two Asian giants in Africa to provide better insight on the specific consequences of Indian and Chinese FDI for economic development in Africa.

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