policy-briefing-51-fdae14bd55556fa4.pdf

This 2012 policy brief examines the struggle of Chinese Economic and Trade Co-operation Zones (ETCZs) in Africa to become operational. Despite official targets and approvals in countries like Zambia, Nigeria, and Ethiopia, most zones remain underpopulated or non-functional, with Egypt being the primary exception. The author identifies failures on the Chinese side, such as top-down developer selection and cultural barriers, and on the African side, including poor offsite infrastructure and a lack of regulatory frameworks to ensure local economic spillovers. The brief notes that private Chinese industrial zones in South Africa and Botswana have fared better than these official state-backed initiatives.

• The policy of exporting Chinese special economic zones to Africa was adopted during the third FOCAC meeting in Beijing in 2006, with an initial target of establishing three to five economic and trade co-operation zones (ETCZs) between 2007 and 2009. While the number of approved zones has since exceeded this target—with eight approved by China’s Ministry of Commerce in Zambia, Nigeria, Ethiopia, Mauritius, Egypt, and Algeria—most are not fully operational. Only the zone in Egypt is fully operational, and the Chambishi zone in Zambia is only partially operational.
• Chinese ETCZs are struggling to attract investors and populate their zones. In Mauritius, the zone has remained without investors for over a year. In Zambia, although 17 companies are registered, most are construction firms or subsidiaries of the developer. The Egypt ETCZ is a relative exception, likely because it was one of the few areas in the North West Gulf of Suez economic zone available to foreign investors.
• Implementation failures on the Chinese side include cultural and language barriers, as well as a 'top-down' approach to selecting developers that ignores project feasibility. For example, in Mauritius, President Hu Jintao directed the Shanxi Provincial Government to appoint steel and coal producers (TISCO and Shanxi Cooking Coal) to a services project, leading to a lack of interest and the eventual withdrawal of Shanxi Coal.
• African host countries face challenges regarding the lack of regulatory frameworks to ensure domestic economic spillovers. In Zambia's Chambishi zone, local suppliers report a lack of regulations requiring Chinese investors to source materials and services locally. Additionally, many host countries lack procedures to enforce the transfer of technology and knowledge, and some have granted overly generous incentive concessions that result in low early-stage returns.
• Poor offsite infrastructure, including electricity, water, and transportation networks, acts as a major deterrent for investors in most African host countries, with the exception of Egypt and Mauritius. Other African-side obstacles include poorly managed land-allocation processes, resettlement delays in Nigeria and Mauritius, and sudden regulatory changes due to political shifts in Algeria and Nigeria.
• Private Chinese industrial zones, such as those established by Hisense in South Africa and Touchroad Group in Botswana, appear to be more successful than the officially supported ETCZs. This suggests that Chinese private investors may prefer to operate outside official zones to avoid control by Chinese authorities or to avoid the costs associated with underpopulated zones.

APA

South African Institute of International Affairs (n.d.). policy-briefing-51-fdae14bd55556fa4.pdf. https://saiia.org.za/wp-content/uploads/2012/07/Policy-Briefing-51.pdf

Chicago

South African Institute of International Affairs. policy-briefing-51-fdae14bd55556fa4.pdf. n.d. https://saiia.org.za/wp-content/uploads/2012/07/Policy-Briefing-51.pdf.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=policy-briefing-51-fdae14bd55556fa4.pdf |url=https://saiia.org.za/wp-content/uploads/2012/07/Policy-Briefing-51.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairsndpolicybriefing51fdae14bd55556fa4pdf, author = {{South African Institute of International Affairs}}, title = {{policy-briefing-51-fdae14bd55556fa4.pdf}}, institution = {South African Institute of International Affairs}, url = {https://saiia.org.za/wp-content/uploads/2012/07/Policy-Briefing-51.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }