Log 404 logistics project

The impact of china’s economic growth on Kenya and Ethiopia

Presented by; Imran Hassan Sheikh Mohamud

18233410036

ASST Prof Dr: Hande Emin Benli

 Table of content.
1. Introduction and research context
2. Literature review
3. Theoretical frame work
4. Methodology
5. Results and Analysis
6. Conclusion.
7. References
 CHAPTER ONE:
Introduction
 International trade has become an increasingly important contributor
to economic growth as a primary factor of openness.

 Chinese international trade has grown rapidly in tandem with the

country's rapid economic growth, prompting the government to look
to the rest of the world as a potential market. This can evidently be
seen on the African continent especially Kenya and Ethiopia.
 THE AIM OF THE RESEARCH

 China has mainly invested in two critical industries which are central to
the development of Kenya and Ethiopia and also at most important to
china BELT AND ROAD INITIATIVE. These industries include
manufacturing and agriculture,

 2nd infrastructure and related industries such as transportation and

energy. The aim of this project is to examine the importance impact of
china’s economic growth for, Kenya and Ethiopia and to analyze the pros
and cons of trade with china.
 RESEARCH OUTLINE
 My research is to understand and analyze the impact that
china’s economy has on Kenya and Ethiopia with close
examination on critical areas of their prospective economic
sectors such as manufacturing and infrastructure and also
analyze in general context on the continent as a whole.

 Secondly, I will analyze the pros and cons of china’s unfair

or militias trade policies towards Kenya and Ethiopia.
 RESEARCH QUESTION

 How is china’s economic growth impacting on Kenya and Ethiopia?

 What role does comparative advantage play in assisting

Kenya and Ethiopia?
 RESEARCH PROBLEM
 In order to understand the events behind china involvement in Africa, I want to analyze if china's lending to the
African continent is good or bad.

 Over the course of about a decade and a half, China has turned into Africa's biggest reciprocal lender, with having
resolved to loan over 150bn USD between 2000-2018, bigger than any OECD (Organization for Economic
Cooperation and Development)lender, and closely matching that of the World Bank in Africa.

 These developments have sparked fears concerning Chinese financing as a geostrategic and coordinated technique,
purposely indebting African governments in order to seize control over critical assets, in what is
now  become  “debt-trap diplomacy”.
 CHAPTER 2;
LITRATURE REVIEW
 Closing development gaps has been a major concern around the world..

 China's interest in Africa on the other hand stems from a desire for resources.

 African nations that export natural resources have profited from favorable terms-of-trade with china (Omoruyi,
M. E. M. 2015) .

 The relationship between China and Africa is evolving. It is increasingly being defined by a growing, confident
Africa with its own socioeconomic growth and political priorities, as opposed to what was once a mythology
built on the selling of primary commodities to fuel China's soaring economic expansion.

 The connection is typical of the unique but asymmetrical ties Beijing has sought to create with strategically vital
and economically stable countries like Kenya and Ethiopia (Shinn, D. H. 2014.) 
 Beijing sees economic and trade cooperation with Addis Ababa as a means rather than an end of itself.

 Ethiopia's cooperation with China, on the other hand, is primarily for political and economic reasons.

 China's partnership with east Africa has evolved into one marked by dynamism and a commitment to the
African agenda.

 My goal is to demonstrate how east African countries can take use of their comparative natural resource
endowment to develop commodity-based economies. Given their increased proximity, however, China's
current structural shift exposes African economies to both hazards and opportunities.
 CHAPTER 3;
EFFECTS OF CHINA'S ECONOMICAL SLOWDOWN AND DIVERSION OF ITS
ECONOMICAL PROWESS ON sub-Saharan Africa.

 The expected downturn in China is due to the country's rebalance away from
investment and toward domestic consumption.

 The Chinese economic transformation, which includes significant rebalancing, is

expected to have an overall positive impact on the global economy, as well as the
economies of Sub-Saharan and African countries.

 Moreover, it has been demonstrated that rebalancing reduces the prevalence of

poverty in Sub-Saharan Africa when compared to the standalone negative effect of a
slowdown,

 Furthermore this slowdown is proven to decrease the prevalence of poverty. With

regard to Sub-Saharan Africa, the combined effect of the slowdown and rebalance is
geared toward poverty reduction, however the degree of this influence differs from
one country to the next. (Lakatos, Maliszewska, Osorio, & Go, 2017)
 Despite Kenya and Ethiopia their privilege and importance to china, state-owned enterprises. (SOEs)
continue to trail considerably behind private companies in terms of profitability and efficiency. Stabilizing
and ultimately deleveraging the economy will be critical to preventing it from collapsing totally.

 (Wekesa, 2013), stated that the economic and commercial laws and regulations between China and East
Africa are insufficient. Because of the current political instability in East African member nations,
economic and trade cooperation between the two sides is restricted.
 CHAPTER 4:
METHODOLOGY

 The Impact of China’s Economic Activities in Africa on Economic Growth of African Countries
has been tremendous. As such descriptive research is favored.

 Secondary data is preferred above primary data, and it is primarily composed of qualitative
information.

 As such content analysis was used with qualitative information in order to explore the impact of
china's economic growth on Kenya and Ethiopia

 the questions are intended to probe for information that will be useful to us in our research project
 CHAPTER 5:
RESULTS AND ANALYSIS
 The influence of China economic link on the aggregate output of African countries is controversial.

 some studies suggest that the economic relationship between Africa and China has an insignificant
or negative effect on factor productivity and economic growth for African countries and is more
dominated by China’s economic interests to access critical resources

 China has a significant interest in Africa’s resources, as do most other countries. For example,
roughly one-fourth of China’s total crude oil imports originate in sub-Saharan Africa while more
than two-thirds of Africa’s exports to China consist of crude oil.
The results of this research findings can be concluded as;
China’s inference in Africa is not measured in terms of virtue and vice but rather it’s significance
in terms of economical prosperity. And is there any doubt in those terms? Most probably not.
china has no doubt benefited from Africa’s abundance resource reserve but also Africa especially
east African nations such as Kenya and Ethiopia have greatly benefited from china.
 CHAPTER 6:
CONCLUSION

 China's economic influence on Africa in the 21st century has been enormous. China became Africa's biggest
trading partner in 2009 and has subsequently expanded the gap with Africa's second largest trading partner.

 The relationship between China and Africa is changing. The creation of this partnership was motivated as
much by diplomatic, strategic, and even ideological considerations on both sides as by economic factors such
as trade and economic growth.

 Our analyses show that China’s involvement in Africa has risen substantially. this interpreted into growing
trade with African nations along with increased investment flows and infrastructure funding. The rising trade,
investment and financial exchanges with African countries prompted expectations about the potential for the
interaction with China to rejuvenate economic growth in Africa,
REFRENCES

Abdilahi, A. I. (2020). Cooperation and Development between China and East Africa. Open Journal
of Social Sciences 8, (4), 153-166.

Lakatos, C., Maliszewska, M., Osorio, I., & Go, D. (2017). China's Slowdown and Rebalancing :
Impacts on Sub-Saharan Africa. Journal of Economic Integration 32, (4 ), 759-803.

MAGNUS, G. (2018). Red Flags. In G. MAGNUS, THE END OF EXTRAPOLATION:

REBALANCING AND REFORM (Why Xi’s China Is in Jeopardy) (pp. 53-74). Yale University Press.

Malancha Chakrabarty. (2016). Ethiopia–China Economic Relations: A Classic Win–Win

Situation? World Review of Political Economy, 7(2), 226–248.

Omoruyi, M. E. M. (2015). The Impact of China’s Economic Activities in Africa on Economic

Growth of African Countries. The Bangladesh Development Studies, 38(4), 47–90. 
Shinn, D. H. (2014). Ethiopia and China: Two Former Empires Connect in the 20 th Century. International
Journal of Ethiopian Studies, 8(1 & 2), 149–164.

Wekesa, B. (2013). The Media Framing of China’s Image in East Africa: An Exploratory Study. African
East Asian Affairs 1,(1), 15-41.