A Comparative Perspective of the Chinese FDI in African Manufacturing

This chapter presents a comparative analysis—government policies and institutions, firm strategies and capabilities, and industrial structure between the textile and leather sectors—constructed on empirical evidence discussed in previous chapters. First, the comparative insight highlights the contributions made by Chinese companies to sector development, employment, and changes over time. Yet, it recognises the uneven performance and outcomes across and within sectors, inquiring into the key drivers behind this. One of the main factors is the inconsistency in government policies and differences in focus. Policy gaps and the inability to address structural constraints such as failures in value addition and systemic input supply also play a role. Additionally, varying focuses of government institutions and coordination among government agencies across industries lead to coordination failure. Second, the analysis demonstrates that the role of foreign direct investment (FDI) in industrialisation is not inevitable and depends to a large extent on how government policies promote and manage the productive nature of FDI. It also suggests that emerging China-Africa economic relations can contribute to Africa’s industrialisation by helping to develop productive capacity, generate employment, and boost the export sector. Third, the state’s role is critical in promoting industrialisation, and a proactive industrial policy, including specific FDI policy regimes, incentive frameworks, and robust government coordination, is an essential driver of this process. The analysis points to the importance of developing industrial hubs and cluster effects to manage FDI and promote industrialisation.