Economic, social and environmental impact of Chinese trade and investments in the Global South

Ernest Kwame Affum (), Solomon Luther Afful (), Cassim Alhassan () and Benjamin Kofi Tawiah Edjah ()

International Journal of Asian Social Science, 2025, vol. 15, issue 10, 324-345

Abstract: The purpose of this study is to examine Chinese trade and investment in the Global South, particularly Africa, analyzing economic, social, and environmental implications from 1992 to 2023. The research employs a comprehensive quantitative methodology using secondary data from MOFCOM, CARI, and IMF databases, analyzing FDI patterns through temporal, geographic, and sectoral frameworks with descriptive statistics and growth rate calculations. The findings reveal three distinct phases of Chinese FDI evolution: Rapid Growth (2003-2010) with 59.3% average annual growth, Expansion (2011-2018) at 16.1% growth, and Consolidation (2019-2022) showing a 2.9% decline. Chinese investment grew from US$0.49 billion in 2003 to US$40.89 billion in 2022, concentrating in the construction (33.3%) and mining (23.8%) sectors. Geographic distribution shows Southern Africa as the leading destination (27.5% of total FDI), while sectoral analysis indicates a shift from resource extraction toward infrastructure development. Trade analysis demonstrates remarkable growth from US$1.26 billion in 1992 to US$172.45 billion in 2023 for exports, though persistent imbalances remain. Comparative analysis with US FDI reveals greater stability in Chinese investments, maintaining consistent positive flows despite global economic challenges. The practical implications suggest that Chinese engagement offers more stable, long-term development partnerships compared to traditional Western approaches, though African policymakers must develop stronger regulatory frameworks to maximize benefits while addressing social and environmental challenges inherent in resource-focused investments.

Keywords: Africa; Chinese investment; Foreign Direct Investment; Global South; Trade relations; South-South cooperation; Infrastructure development; Resource extraction; Economic development; Bilateral trade. (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://archive.aessweb.com/index.php/5007/article/view/5636/8472 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:asi:ijoass:v:15:y:2025:i:10:p:324-345:id:5636

Access Statistics for this article

More articles in International Journal of Asian Social Science from Asian Economic and Social Society
Bibliographic data for series maintained by Robert Allen ().