China's Infrastructure Financing and the Role of Infrastructure in Awakening African Economies

Ehizuelen, Michael Mitchell Omoruyi

doi:10.4018/jcad.20210701.oa2

Cited by 4 publications

(2 citation statements)

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“…Along the same line, Effiom (2020) highlighted the positive influence of critical infrastructure development, such as transport and Information and Communications Technology (ICT), on Africa's long‐term economic growth and poverty reduction. Further empirical investigations by Ehizuelen (2021) using the generalized method‐of‐moments estimator revealed the positive effects of infrastructure quality on output and productivity in manufacturing and services in Africa. Likewise, Azolibe and Okonkwo (2020) found that telecommunications infrastructure quality significantly influences industrial productivity in sub‐Saharan African countries.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Furthermore, infrastructure development is instrumental in facilitating industrial upgrading, improving structural efficiency, and fostering economic growth through inter-industry correlation effects. Besides, high-quality infrastructure positively impacts output and productivity in manufacturing and service sectors, leading to increased returns on private capital, as highlighted by Ehizuelen (2021). In developing nations, robust transportation networks play a critical role in attracting FDI, facilitating trade, reducing transaction costs, and promoting overall economic activity.…”

Section: Infrastructure Development Fdi and Economic Growthmentioning

confidence: 99%

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Driving economic growth in African countries: Do Chinese OFDI sectors matter?

Fambo,

Shunqi

2024

Social Science Quarterly

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BackgroundRecent years have witnessed a growing interest among academics and policymakers in understanding the mechaninsms through which Chinese outward direct investment (OFDI) impact economic growth in Africa.MethodThis study utilzes a dataset spanning 41 African countries from 2005 to 2020,employing panel‐corrected standard error (PCSE) and quantile regression.ObjectiveThis study explore the mechanisms through which Chinese OFDI stock contributes to economic growth in Africa,with a particular focus on financial development and transport infrastructure.ResultsThe results indicate a significant and positive impact of the interaction between Chinese OFDI stock and both financial development and transport infrastructure on economic growth. The subregional analysis reveals varying correlations across regions, while the quantile regression analysis demonstrates a stronger effect on economic growth as we move to higher quantiles.ConclusionThe study underscores the importance of enhancing infrastructure and financial sector development to attract more Chinese OFDI and maximize its positive impact of economic growth in African nations. Hence, we recommend that African countries improve the infrastructure and financial sector of their country to attract more chinese OFDI and also enhance its effectiveness on their economic growth.

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Section: Literature Reviewmentioning

confidence: 99%

Section: Infrastructure Development Fdi and Economic Growthmentioning

confidence: 99%

Driving economic growth in African countries: Do Chinese OFDI sectors matter?

Fambo,

Shunqi

2024

Social Science Quarterly

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A study of the resources-for-infrastructure agreements in oil-rich markets

Oluyeju,

Oluyeju

2023

JGR

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Infrastructure acts as a catalyst for human and economic development and is critical to the general functioning of a society. It defines a country’s international competitiveness and creates jobs (Chen, 2018). However, in Sub-Saharan Africa (SSA), it is well documented that, in terms of the most common measures of infrastructure development, the region typically lags behind most developing regions (Calderon et al., 2018). Although the region is abundantly rich in natural resources, with discoveries being continuously made, the lack of infrastructure remains one of the significant obstacles to sustaining economic development in the region. Given the constraints on traditional sources of infrastructure finance, resources-for-infrastructure (R4I) deals present one of the most promising financing techniques for bridging the infrastructure gaps in SSA (Halland et al., 2014). Its potential use, however, begs the question of whether R4I deals guarantee remunerative returns by ensuring the mutuality of benefits between host nations and foreign developers. In answering this question, we used a theoretical or doctrinal approach. Although certain aspects of R4I deals as a financing mechanism are flawed, this mechanism can be leveraged to address the huge infrastructure deficit in the region. This paper thus informs policymakers on the aspects of R4I deals that need reform.

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China in Africa: An Examination of the Impact of China’s Loans on Growth in Selected African States

Mlambo

2022

Economies

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This study sought to test the impact of China’s infrastructure investment on economic growth in selected African states. Many comparative studies have shown the positive role that infrastructural loans plays in supporting economic growth. However, for Africa, the role of China’s infrastructure projects has mixed views with regards to its contribution to growth and development. A survey of the literature showed that the central question about Chinese infrastructural loans is whether the infrastructural projects are beneficial or detrimental to Africa. Currently, there is no settled opinion as to whether (or not) Africa is benefiting from the Chinese economic relations. This study was quantitative, and we used panel data to achieve our objectives. The study employed annual panel data for 15 African countries covering the period of 2000–2017. The Pooled Mean Group, Mean Group, Fully Modified Ordinary Least Squares, and Dynamic Ordinary Least Squares panel techniques were used for estimation purposes. The main conclusion from the quantitative analysis of China’s infrastructural loans in Africa is that China’s efforts in developing infrastructure are translating into economic growth. This study provides evidence that China’s engagement in Africa could be beneficial, given the positive relationship between loans and economic growth.

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China's Infrastructure Financing and the Role of Infrastructure in Awakening African Economies

Cited by 4 publications

References 26 publications

Driving economic growth in African countries: Do Chinese OFDI sectors matter?

Driving economic growth in African countries: Do Chinese OFDI sectors matter?

A study of the resources-for-infrastructure agreements in oil-rich markets

China in Africa: An Examination of the Impact of China’s Loans on Growth in Selected African States

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