Just arrived in Ghana, I flipped through a local magazine and was struck by its selection of best cartoon of 2013: a map of Africa marked by a vast Chinese footprint and President Obama walking over the map making tiny US footprints and looking rather puzzled.
The Chinese have indeed left a very strong footprint in many African countries, as western nations are belatedly finding out. However, people on both sides still struggle to convert this solid footprint into fruitful collaboration. Business schools can help any such collaboration by aiming to enhance mutual understanding and help businesses to bridge the two very distinct cultures.
Today Chinese companies feature prominently in any review of the large investments in Africa, be it as investors, constructors, or as financiers. African economies need such projects, not only to unlock the value of their natural resources, but to fill critical gaps in their infrastructure. Naturally Chinese investors are first interested in connecting the mines to ports from where resources can be exported.
Yet Chinese investments extend much further. In Ghana for example, a Chinese state company from Shandong province has announced its intention to build an aluminium plant. Such a project is strategically important for a country that is trying to create more value added to its raw material exports. Economic updates on various African countries suggest that the Chinese not only have a presence almost everywhere, but account for many of the largest new loans and the largest investment projects. The potential for mutually beneficial business is vast and appreciated by leaders on both sides.
Yet, despite these obvious opportunities, the relationship between Africa and China is anything but smooth. On a strategic level, questions are asked about whether the Chinese engagement in Africa is really as beneficial as is claimed. Nigerian Central Bank Governor Lamido Sanusi created quite a stir when he argued that China’s engagement in Africa resembles the former colonial masters’ in the sense that Africa is exporting raw materials and importing manufacturing goods. Such a view is supported by the fact that some African countries have experienced a decline in manufacturing’s share of GDP in recent years.
Some also argue that infrastructure financing from Chinese sources may not be as favourable as it appears. For example, Ghana’s opposition party made a big fuss about the conditions of a $3bn loan agreed in 2011, arguing that the conditions were too cumbersome. Others criticise loans that are tied to engaging Chinese construction companies or purchasing goods from China. But it was not so long ago that European aid money also had similar strings attached.
When Namibian Prime Minister Hage Geingob asserted that whoever comes to Namibia must come on Namibian terms that sounded reassuring. Yet when Namibia (population 2.3m) negotiates with China (population 1.35bn) the bargaining power may not always be finely balanced.
Yet even more challenging: when it comes to personal interaction, Chinese and Africans still seem to be light years apart. The shortage of internationally experienced managers is a pivotal weakness for Chinese companies as they start operating in multicultural settings.
This mutual lack of cross-cultural competences highlights two challenges for business education in China and Africa. First, such competences are hard to develop in organisations that traditionally have limited internal diversity; business education has a critical role in facilitating the development of cross-cultural sensitivity among business leaders. Second, leaders who are at ease communicating across cultural boundaries may still find cross-cultural conflicts arising at lower levels of the hierarchy. Thus, future leaders not only need cross-cultural experience in a classroom setting, but they need practices and processes that they can use to facilitate cross-cultural experiences throughout their organisation, encompassing everyone who may come into contact with foreign colleagues, customers or suppliers.
The author is professor of strategy and international business at China Europe International Business School and teaches for Ceibs in Shanghai and Accra.