Chinese national oil companies and the economic development of African oil producers

By: Giles Mohan
Funding Body - DFID-ESRC
Funding period - Friday 01 May 2015

After decades of being regarded as ‘basket cases’ some African economies are experiencing growth rates that are among the fastest in the world. Much of this growth is based on the export of commodities, like oil, to China and other emerging economies. Driving this engagement are Chinese national oil companies (NOCs). While we hypothesise that the Chinese do things ‘differently’ to other oil investors in Africa we do not know whether the different corporate strategies of the leading Chinese NOCs and the specificities of African political economies they engage with generates unique forms of development, and if so in whose interests? Crucially it is a mistake to see this as one-way traffic with Chinese firms entirely determining the agenda. Our past ESRC-funded research reveals the importance of African agency in shaping the terms of this engagement and with it the potentials for development.

This project will be the first to assess whether and how such developmental benefits may be occurring. We will start by investigating the Chinese NOCs and their relationships to key state and semi-private agencies in China, before undertaking field research in Africa. Important here are the complex ‘packages’ of aid, trade and investment in Africa through Chinese NOCs, banks and ministries. Chinese NOCs are active across Africa but three countries - Ghana, Angola and Sudan - represent different aspects of their engagement with the continent. These countries are also unique so these contextual differences allow us to examine the role that African agency plays in shaping the nature of and benefits from this new investment in their oil sectors. We will also assess their impacts and the extent to which the growth they generate – directly, through oil-backed infrastructure, and via state revenue - trickles down to Africa’s poorest.

The project is a collaboration between The Open University and the Centre for Energy, Petroleum and Mineral Law and Policy (CEPMLP) at University of Dundee. The Open Univesity is the lead research institution on the project with Professor Giles Mohan as the principal investigator, and co-investigators from CEPMLP.

More details can be found on the project flyer

Partners:

African Centre for Energy Policy

Chinese Academy of Social Sciences,

Party School of the Central Committee of CPC

CNPC Economic and Technology Research Institute

Project documentaries

Watch the project research team and some of the members of the project’s international advisory network talk about the project particularly with regards to the importance of the questions being researched.

Overview They provide an overview of the nature of Chinese outward direct investment in the oil and gas industry and raises questions about how such investments in Africa would affect development in the host countries.

 

Drivers The potential drivers of Chinese outward direct investment in Africa’s oil and gas sector are hypothetically explored.

 

Linkages They highlight questions regarding whether Chinese investments in oil and gas sector could help local enterprises to develop, increase employment and enhance development.

 

Governance The focus is the likely interplay between investment with “Chinese characteristics” and the political structures of host African countries and its implication for governance and development.

 

Finance The researchers highlight questions about the link between Chinese engagement in Africa’s oil and gas sector and infrastructure development financing in the host African countries and its implications for development.

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Contact

Professor Giles Mohan

Development Policy and Practice
Faculty of Maths, Computing and Technology
The Open University
Walton Hall
Milton Keynes
MK7 6AA
United Kingdom

Tel: +44 (0) 1908 653 654
Fax: +44 (0) 1908 654 825
E-mail: Giles Mohan



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