Investment Motivations And Challenges For Chinese Firms In Africa: An Analysis Of Angola And Zambia

Nowadays, China is the largest investor in Africa. The world’s second largest economy has been investing throughout the African continent mainly for a couple of decades, maintaining good relationships with local governments. This investment, however, started gaining international media attention since the new millennium, as this is when Chinese firms started carrying out a larger number of investment projects Chinese investment has largely contributed to the development of African nations including Angola and Zambia. It was motivated by similar aspects and quickly growing number of investment projects has caused serious challenges that Chinese companies need to overcome. Most of the challenges are similar in Angola and Zambia; however, differences also do exist. Such challenges are also found in other African nations, as investment motivations of Chinese firms throughout the continent are mainly resource seeking.This thesis will discuss Chinese investment motivations in Angola and Zambia and how this relates to the challenges facing Chinese firms in both countries. Some examples will also be given from the rest of Africa. The thesis will employ the Dunning’s Eclectic model and the modernization theory as the theoretical foundation of analysis. The paper will determine the main motivations for the Chinese firms’ investments into Angola and Zambia and identify the rising challenges they need to cope with. In conclusion, the paper will present necessary policy changes that Chinese companies should consider in order to improve their position and reputation in Angola, Zambia, and effectively, the rest of Africa.