Chinese construction firms in Africa bring prosperity to local workers, says study

Angola ScalengheA new study has challenged perceptions concerning unfair labour practices of Chinese construction firms in Africa

The findings by SOAS University of London, showed the proportion of national (Ethiopian and Angolan) workers in the labour force is substantially higher than normally assumed in the press. In Ethiopia these rates were 90 per cent of all workers (and 100 per cent for low-skilled workers) and in Angola, where rates are usually much lower due to skill shortages, estimated rates were 74 per cent. 

Dr Carlos Oyam, who led the project, said, "One of the common perceptions of Chinese firms working in Africa is that they do not employ locals, the working conditions are exploitative and that they don't contribute to skills development. However our findings after four years of research have drawn up a very different picture. In Angola, for example, the firms employ some of the poorest where accommodation and food is provided, which in many ways can be seen as a route to actively help with poverty reduction in the region."

In Angola, the project found that localisation had grown significantly in the previous 10 years as Chinese firms settled in that market context. Given that Chinese contractors have dominated the road construction market in Ethiopia and Angola, they have been the main contributors to job creation in absolute terms in this sector, especially in recent years. Chinese firms have also led job creation in the Ethiopian manufacturing sector during the same period.

Wage comparisons

Wages in sampled Chinese firms were broadly similar to other top firms in the same sectors. In addition, they found that in Angola many Chinese firms adopted a migrant dormitory labour regime by employing relatively poorer workers from the south of the country, where employment opportunities are scarce. Therefore, these workers also obtained food and accommodation and managed to save more from their wages than workers employed in other firms, especially in Luanda, where living costs are high, and this may actively result in poverty reduction.

In Ethiopia, sampled Chinese firms contribute to training and skill development at least as much as other firms in the same sector, and in the manufacturing sector training is widespread and considered as much more necessary by firms. In Angola, all firms have to provide different forms of informal on-the-job training given the severe skill shortages in the country especially for workers lacking relevant experience and education, but national firms and some foreign firms tend to have some more formal types of initial induction training.

The full reports from the research are available on the SOAS website

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