What causes China's foreign investments to have limited enduring and positive economic impacts on a host country, like Angola?

The scope of this research is to figure out why, despite all the “infrastructure for resources” kind of investments undertaken by the Chinese, Sub-Saharan countries have not yet solved their widespread poverty issue. More specifically, the focus will be on Angola; a country that experienced extraordinary GDP growth in the first years of the economic partnership with China, yet poverty among the population remains rampant. Therefore, in order to discover what might explain a lack of economic development in a particular country that receives a great amount of infrastructure-related investments from China, I will firstly list four aspects that have been claimed to be destructive for the sustainable economic development of a country. These are: the non-interference approach adopted by China, the Chinese companies’ hiring policy, the lack of good governance and the disadvantage of the resource curse, by which many African countries are affected. After that, I will analyse these aspects...Show moreThe scope of this research is to figure out why, despite all the “infrastructure for resources” kind of investments undertaken by the Chinese, Sub-Saharan countries have not yet solved their widespread poverty issue. More specifically, the focus will be on Angola; a country that experienced extraordinary GDP growth in the first years of the economic partnership with China, yet poverty among the population remains rampant. Therefore, in order to discover what might explain a lack of economic development in a particular country that receives a great amount of infrastructure-related investments from China, I will firstly list four aspects that have been claimed to be destructive for the sustainable economic development of a country. These are: the non-interference approach adopted by China, the Chinese companies’ hiring policy, the lack of good governance and the disadvantage of the resource curse, by which many African countries are affected. After that, I will analyse these aspects in the more specific case of Angola in order to investigate which obstacles are inhibiting its economic development in actuality. Finally, I will argue that if the Angolan government solves its governance issues and adopts adequate measures to change the structure of the national economy, then, China will presumably be able to provide good opportunities to further stimulate economic development. However, if nothing is changed at the governance level, it is very unlikely that an economic transformation will ever take place.Show less

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What causes China's foreign investments to have limited enduring and positive economic impacts on a host country, like Angola?