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Abstract
The authors discuss the strategic entry of Chinese private enterprises (PEs) into Africa by analyzing their characteristics of host distribution and overseas companies’ function and type. They find that Chinese PEs tend to invest in countries where Chinese investment has already concentrated, that more Chinese PEs engage in manufacturing and services than in agriculture and mining and quarrying, and that Chinese PEs take higher risks by choosing the type of subsidiary companies to enter Africa. They also make an empirical study of the determinants of Chinese PEs compared with state-owned enterprises in the period 2002–2011 and found Chinese PEs in Africa are driven mainly by the motivation of market-seeking, not by resource-seeking; China's imports from the host country also facilitate Chinese companies’ investment in Africa; and Chinese companies in Africa are risk-takers. At the end of the article, they study the case of Touchroad and verify the results of their empirical study.
Notes
Source. MOFCOM (Citation2013).
Note. Agriculture comprises cotton planting, fishing, forestry, and livestock husbandry. Mining and quarrying comprises ore mining and quarrying from the natural world. Manufacturing covers more industry, such as ferrous and nonferrous metal smelting and rolling processing, textile and clothing, automobile and spare parts, cement, telecommunication equipment, food, and pharmaceutical and chemical production. Service covers project management, market research, telecommunication, trading, investment, education, and training.
Source. MOFCOM (Citation2013).
Note. All monetary values are in constant (2000) US$ prices.
Note. Standard errors are in parentheses.
Coefficient is significant at the ***1%, **5%, and *10% levels, respectively.
Note. Standard errors are in parentheses.
Coefficient is significant at the ***1%, **5%, and *10% levels, respectively.