Economic Diplomacy and Nigeria – China Relations (1999-2007

China is essentially a state par excellence, a strong state like the United States with expansionist behaviour and attitudes. Demographically, China has the largest population in the world, 1.3 billion inhabitants that is more than the entire African continent. It has the third largest stock of foreign direct investment after the United States and United Kingdom. Its ideology has been the socialist market economy which embodied elements of pragmatism, free market and state dirigisme. In the past few years, especially since the declaration of the Beijing Consensus, intellectuals, Western media, human rights organization and the International Monetary Fund have intensified their criticisms regarding Chinese policy towards Africa, especially its loan and foreign investment practices and its behaviour and attitudes towards oil producing states. Regrettably, China’s increasing engagement with Africa has largely gone unnoticed in African studies. To worsen the situation, very few African scholars have devoted quality time to critically anlayse Nigeria-China relations since the end of the Cold War. This study has been designed to bridge this gap in the literature. The central questions that formed the foundation of the inquiry are; what were the determinants of Nigeria – China relations between 1999 to 2007? To what extent has economic diplomacy impacted on the trade relations and inflow of foreign direct investment from China to Nigeria within the period under review? Theoretically, we anchored our analysis within the liberal theory of economic development and underdevelopment. Our choice of this theory is based on the fact that Nigeria – China relations is based on partnership, mutuality, reciprocity, and common prosperity, and not on any form of European or American neocolonialism and imperialism. The liberal theorists believe that interdependence between the developed and developing countries are beneficial to both. This theory is related to the win-win theory of international relations. The win-win theory implied that liberal economic cooperation through trade flows, foreign-domestic flows, technology transfer and integration in the global value chains and aid flows, should bring proportional benefits, which otherwise the partners would not have access to before entering into these relations. We adopted qualitative research design and relied mainly on documentary sources of data collection and content analysis of primary and secondary sources of data. We collected data from Chinese Embassy, Nigeria’s Foreign Affairs Ministry, Nigeria Investment Promotion Commission, Central Bank of Nigeria and Nigeria Immigration Service among others. More importantly, we relied on current journals, textbooks, magazines, conference papers and other secondary sources of data. To ensure the validity and reliability of our methods, we relied on content of analysis of available information. After critical analysis of available data, the study reveals that China’s dynamic economic growth is fueling an ever increasing demand for Nigeria’s oil. In fact, guaranteed long term access to Nigeria’s relatively underexploited natural resources clearly tops China’s agenda. In 2005, China through her corporation, Petro-China singed an $80 million contract with Nigerian Government to locate upstream oil and gas that will guarantee 30,000 barrels per day to China over a period of five years. China has invested over $4 billion worth of investment in exchange for oil in Nigeria. At present, just over 30 percent of China’s oil requirements come from Africa, mostly from Sudan, Nigeria and increasingly the Gulf of Guinea. Beijing has singed more than 40 oil agreement with different African countries including Nigeria. The study also shows that while china’s principal interest in Nigeria is access to natural resources, the country also provides new markets and investment opportunities for China’s growing economy. Currently, about 750 Chinese enterprises are active in Africa with total investment of over $1 billion and many of them are doing business in Nigeria. In conclusion, china is both a tantalizing opportunity and a terrifying threat to Nigeria. On the one hand, China is just the tonic that mineral rich, but economically ailing Nigeria needs. On the other hand, China’s effort to flood the Nigerian market with cheap products is a great threat to the Nigerian economy.

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