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Background papers prepared for the Africa-China Poverty Reduction and Development Conference
China’s Industrialization: Overview – Implications for Africa’s Industrialization
Within a span of some six decades, especially the three decades after reform and opening up, China has been basically transformed from a traditional agricultural country to a modern industrialized state. The share of the population employed in the secondary industry to the total population increased from 7.4 percent to 30.3 percent from 1952-2012. The share of manufactured production value to total GDP in 2013 reached 43.89%, and the production value share was 19.8% to total global manufacture production value in 2012. China’s industrialization process should not just be examined from the time frame of the past six or three decades however, China’s development is a continuation of Chinese civilization. One also needs to note that China’s industrialization not only follows a universal path, but also has its own particularities in historical, political, cultural and social conditions. Despite this great achievement, China’s industrialization process has also resulted in huge problems, including high energy consumption from extensive industrialization and environmental degradation such as worsening water quality and air pollution as well as land contamination and social inequality.
This report does not intend to describe and analyze China’s industrialization process nor make comparisons between China and Africa systematically. Instead, it summarizes and introduces some of the factors that helped China industrialize its economy and which might also be important or relevant to African (we refer to Sub-Saharan Africa) conditions. It is intended to share those experiences with African countries to help better design their industrialization policies.
China’s industrialization can be roughly divided into three stages. The first stage spans from 1953 to 1978 when China prioritized heavy industry through the centrally planned economy, with the intention of accomplishing a great leap forward and catching up with the developed world. The second stage, the period of 1979 to 1999, witnessed a more balanced development to promote light industries. The roles of the market and private businesses in promoting industrialization were emphasized and encouraged. The third stage starts from 2000 when China saw the reappearance of heavy industrialization and more knowledge intensive sectors. The process has reflected virtual interaction among the state, market and society.
China’s industrialization success carries many experiences, such as how to grasp the opportunities provided by globalization, how to develop infrastructure to eliminate the bottleneck for industrialization, how to develop the SEZs to absorb foreign capital and technology etc. It has also provided negative lessons, for instance environmental damage and social inequality. However, we argue that China’s industrialization does provide a reference for African countries (we refer to Sub-Saharan Africa) in their industrialization process.
Certainly Africa cannot follow China’s industrialization path, but there is a lot that Africa can learn from the Chinese industrialization experience. The essence of China’s industrialization success has been largely driven by the state-led industry policy, i.e. to use the role of the state to eliminate barriers at each stage of development so that the country’s comparative advantage can be utilized. In this regard, African countries face the challenge of how to reshape the role of the state to better use the political advantages given that most African countries’ have checks and balances based on competing politics to avoid short run, low political equilibrium. To have a consensus based development priority is essential to concentrate resources to let industrialization take place. For most African countries, to develop their agriculture is far the most important condition for industrialization because without a well-developed agricultural sector, industrialization cannot be sustainable. This does not suggest any development sequence, but rather to suggest that for agriculture-based economies, a broad-based development strategy that can link agriculture, industries as well as the services sector for labor employment and capital flow is critical. African agriculture has grown about 4-5% over the last decade, but this growth largely derives from area expansion, rather productivity improvement. Given Africa’s high population growth, Africa needs to achieve higher agricultural growth rates to produce meaningful margins. Meanwhile, global industrialization transformation will provide a great opportunity for African countries to use their comparative advantages. This can be seen from the case of increasing cost of labor in the emerging countries, particularly China. It suggests that Africa’s industrialization strategy should not only look at the conditions inside the continent, but also needs to see how their strategies can reflect how to engage with other emerging players.
Overall, to strength the role of the states and to promote agricultural development in order to lay down the foundation for taking a great opportunity to jump-start industrialization will be a challenge for African countries to move towards inclusive development.
What can Africa Learn from China’s Experience in Agricultural Development?
Since the 1980s, poverty levels have not changed in sub-Saharan Africa and the incidence of poverty remains higher than 40 per cent. Agricultural productivity in both land and labour terms in sub-Saharan Africa has been stagnant since the 1970s, and over the last 40 years, sub-Saharan Africa has become a net importer of agricultural commodities and staple foods. Consequently, the literature on African agriculture has been largely pessimistic, and despite some more nuanced assessment in recent years, ‘Agro-Afro-pessimism’ continues to permeate the policy discourse.
By contrast, in China, during almost the same time period, and particularly from 1978-2009, China’s agriculture grew at an annual average rate of 4.5 per cent, total grain output at 2.4 per cent and population at 1.07 per cent. Agriculture and total grain output consequently outpaced population growth, which enabled China to feed a population accounting for 20 per cent of the world’s total from its limited arable land (11 per cent of the world’s total) using water resources equivalent to 25 per cent of the world average. The steady growth in agriculture and rural economy has been an important contributor to reducing China’s rural poverty.
The experiences and lessons of agriculture-led growth and poverty reduction in China have naturally attracted the attention of sub-Saharan Africa and the international community. However, we should be cautious in drawing on the experiences of China’s growth and poverty reduction strategies more broadly, given the two very different contexts. China has been a unified country despite its cultural diversity and vast territory, while Africa is a continent of 55 countries with diversified social, economic and environmental conditions. However, Africa can certainly draw experiences on how smallholder-based agriculture in China has been developed, and at the same time learn lessons on the range of problems associated with China’s agricultural development – such as the emergence of an unequal society with a strong urban-rural divide, unclear land rights for farmers and highly intensive farming, leading to pollution and the degradation of natural resources.
This article intends neither to compare agricultural development in China and Africa, nor to analyse China’s agricultural experiences, but to highlight some of the key conditions that enabled China to achieve its success in agricultural development and poverty reduction and to relate these where possible to the African context. This requires a clear account of the Chinese experience which, although unique in many ways, still affords some interesting potential examples for sustainable agricultural development in many parts of Africa. After briefly discussing the historical conditions that both China and Africa inherited, the article focuses on agricultural policy processes in China and Africa.
In conclusion, there is a focus on smallholder agriculture, arguing that this structural feature of the Chinese model has the most promise for African rural and agricultural development.
