Libya, China and the Myth of ‘No-Strings’ Investment

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Beijing is scrambling to get tens of thousands of people out of Libya after a wave of attacks on Chinese oilfields, construction sites and work camps. As the state-run China Daily reported prominently this morning, about 12,000 Chinese nationals were evacuated by charter plane, ocean liner and bus.  State media area playing up the efficiency of the rescue effort and the relief of survivors: “We almost burst into tears when we heard that our government had chartered a plane to take us back home,” one woman told Xinhua.

That, of course, is only half the story. China’s investment in the north African nation has expanded rapidly of late, tracking Beijing’s massive spending spree across the continent. In 2000, two-way trade between China and Africa was about $10 billion. By 2010, that figure jumped to $90 billion. China’s biggest energy and infrastructure firms — including China National Petroleum Corporation and China Railway Construction Corporation, which were both hit this week— have led the push. About 30,000 Chinese nationals were in Libya when violence broke out.

In Africa, as elsewhere, Beijing has professed a policy of non-intervention. For a time, this ‘no-strings’ foreign policy seemed to allow Chinese leaders to enjoy what the Economist once called “controversy-free safaris,” as African governments eagerly traded access to resources for cheap loans and investments dollars. But it was rarely that simple. Anti-Chinese sentiment has bubbled across the region, forcing Beijing to defend itself against claims of neo-colonialism, exploitation and abuse.  When it comes to foreign investment, there are always strings attached.

Which brings us back to Libya. Though China is unlikely to back away from its official policy of non-intervention, some wonder if recent events will encourage Beijing to think twice before pairing up with the likes of Gaddafi. A front-page story in Hong Kong’s  South China Morning Post today (‘China pays for risky African ventures’) quoted a professor from Peking University who said she’d teach the Libya debacle as a “case study” in the potential perils of aggressive overseas expansion. As Party officials count the cost of the evacuation and its aftermath, it will be interesting to see if they, too, heed the lesson.

More: For insight on China’s role in Africa, read Alex Perry‘s 2009 dispatch from Kinshasa, Cape Town and Lusaka. To get a feel for how Chinese foreign policy is shaping Asia, check out Hannah Beech’s piece, “The World of China Inc.”

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