English - United Nations Development Programme

Introduction
China’s rapid economic growth since it opened up its economy in 1978 to the rest of the world, and in
particular since its accession to the World Trade Organization (WTO) at the end of 2000 is phenomenal.
The rate of economic growth averaged 9.1 per cent during 1981-1990, 9.9 per cent during 1991-2000
and 10.5 per cent during 2001-2010. It is now the second largest economy in the world behind the
United States, not only impacting on the balance of global economic power but also reshaping regional
growth dynamics. The surge in demand for production inputs and the rising domestic consumption
demand have changed the direction of international trade and pattern of growth.
The robust growth in emerging economies such as China has implications for the rest of the world,
including economies in distant regions such as Sub-Saharan Africa (SSA). For example, the share of
exports from SSA countries to China in total exports has increased from 5 per cent in 2002 to 19 per cent
in 2010 (World Bank 2012). On the other hand, foreign trade between Africa and China has grown ten
fold during 1998 and 2006. Interestingly, this is a period when SSA countries on average experienced its
highest economic growth in recent history.
Although most of trade with China is concentrated in a few countries endowed with natural resources,
the pattern seem to be changing with increasing trade links with other SSA countries as well. Apart from
other strategic priorities, the need for ensuring sustainable supply of raw materials has also prompted
China to invest heavily in infrastructure in countries with strong trade links but as in trade, China’s
investments go beyond major suppliers of raw material.
How significant are trade and investment links of SSA countries with China on economic growth of
African countries? While spillover effects of China’s rapid economic growth on neighboring Asian