A surprising finding about how Chinese companies pay in Africa

A new study has found that Chinese companies in Africa are not paying their local workers worse than their Chinese colleagues, contrary to popular belief.

A surprising finding about how Chinese companies pay in Africa

Chinese companies are active in sub-Saharan Africa and have built infrastructure projects. They've gained a bad reputation as they pay their local employees poorly compared to their Chinese counterparts. The authors of a recent study found that this reputation was undeserved at least in Ethiopia, and Angola where the study took place.

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Carlos Oya, from the School of Oriental and African Studies in London (SOAS), and Florian Schaefer, from Kings College London interviewed more than 1,400 local workers to determine if it was true and what this meant. "The most cited--and most widely discussed--literature on working conditions in Chinese firms in Africa tends to emphasise poor and often 'worse' working conditions, even when it is not clear what the comparator is, whether 'average' conditions in the host country or comparable foreign firms," Oya and Schaefer wrote.

They wrote that many past studies were based on too few examples (such a Human Rights Watch report from 2011 on two Chinese mining firms operating in Zambia) or focused more on wages than on working conditions. The authors of the study decided that, while working conditions are important and it is important to call out bad practices in individual companies, they would like to focus on the question of pay.

Oya and Schaefer conducted a survey of workers in the manufacturing and construction industries at Chinese and other foreign owned firms in Angola and Ethiopia as well as local businesses in both countries. They asked about not only how much workers were paid but also their education, skills, roles, and any other personal information that could affect pay.

The authors concluded that there was a substantial difference in pay between the two countries. The authors found "slightly lower salaries in Chinese companies for some segments," as they noted: semi-skilled workers in Angola, and semi-skilled workers in Ethiopia. The study found that a large part of the difference in wages could be explained by differences such as workers' skills or education. The study published in World Development found that there is no "clear evidence" that Chinese companies consistently pay lower wages than comparable firms in the same industry and country.

The study does not absolve Chinese companies of any wrongdoings in sub-Saharan Africa and only looks at pay in two countries. It's a sign that the story about Chinese companies exploiting locals may be more complex than most people think.