FRIEDRICH-EBERT-STIFTUNG – CHINA’S INTERNATIONAL DEVELOPMENT COOPERATION 5 LABOUR IN CHINESE-FINANCED INFRASTRUCTURE PROJECTS ROLE IN AFRICA’S INFRASTRUCTURE DEVELOPMENT As of 2022, China is responsible for over 30 per cent of major infrastructure projects in Africa. 181 This includes both Chinese-funded projects and projects funded by the World Bank and other multilateral lenders whose tenders were won by Chinese companies. Between 2007 and 2020, China’s two state-owned development banks, CDB and China Exim Bank, invested USD 23 billion in African in­frastructure. This is more than the other top eight lenders combined, a list which includes the World Bank and Euro­pean development banks. 182 By comparison, total compa­rable finance by MDBs averaged only USD 1.4 billion a year from 2016 to 2020. 183 In 2020, about 15 per cent of all fi­nance for large infrastructure projects in Africa came from China. 184 Several factors account for China’s dominant presence in the African infrastructure construction sector. 185 One is that China simply provides much more money than West­ern development finance institutions for this purpose. An­other explanation is tied to the fact that Chinese infra­structure development companies active in Africa are state-owned, pointing to the possible role of corruption and diplomatic wrangling. However, a likely substantial part of the explanation is simply that Chinese construction companies are very competitive due to their considerably lower labour costs. This explains why Chinese contractors increasingly win international World Bank tenders, espe­cially for civil works projects. 5.2  EMPLOYMENT AND LABOUR CONDITIONS IN CHINESE CONSTRUCTION COMPANIES Chinese construction companies are now one the major employers in Africa. When Chinese companies build on be­half of the World Bank or other multilateral lenders, they are bound by international standards. When projects are fi­nanced by Chinese lenders, China applies the“host country principle”, which means there is no obligation to adhere to international standards; companies orient themselves to the host country government’s demands. In numerous cases, this has led to poor labour practices in Chinese companies, which has become one of the most contentious issues in China-Africa relations. Some of the issues identified include violations of workers’ rights, lack of social security cover­age, limited skill transfer, ignorance of health and safety standards, barriers to unionising, and violations of national labour laws. Many Chinese companies employ lax labour standards when it comes to hiring or firing workers. They do not sign formal employment contracts and pay workers per day or week. 186 By paying daily, companies can avoid paying mini­mum wage, health care, social security, and overtime pay. 187 The lack of contracts deprives workers of their right to join trade unions and denies them such benefits as protection under minimal wage standards, health care, social security, and overtime pay. Without the mediation and protection that trade unions provide, workers have no other recourse than to go on strike. 181 K-C.(2022). China Is Delivering over 30% of Africa’s Big Con­struction Projects. Here’s Why. The Africa Report, 16 March. https:// www.theafricareport.com/183370/china-is-delivering-over-30-of-­africas-big-construction-projects-heres-why/ 182 & Cardenas Gonzalez(2022). Stuck Near Ten Billion: Public-Private Infrastructure Finance in Sub-Saharan Africa. https://www.cgdev.org/ sites/default/files/stuck-near-ten-billion-public-private-infrastruc­ture-finance-sub-saharan-africa.pdf 183 Ibid. 184 enny, C.(2022). Why Is China Building So Much in Africa? Center for Global Development, 24 February. https://www.cgdev.org/blog/ why-china-building-so-much-africa 185 Ibid. Chinese companies’ poor employment practices in Africa are a reflection and externalisation of domestic labour practices. 188 Low wages and lack of worker welfare are the shadow of China’s bright economic miracle and low la­bour-costs. In China, lower wages are often justified by the 186 hao, Q.(2020). How to Establish Labor Protection Standards for Kenyan Local Workers in Chinese Multinational Corporations. Wash­ington International Law Journal 29(2), 455–483(457). https://digital­commons.law.uw.edu/cgi/viewcontent.cgi?article=1837&context=wilj 187 Ibid., 457–458. 188 G.& Sarpong, D.(2022). The Evolving Perspectives on the Chi­nese Labour Regime in Africa. Economic and Industrial Democracy 43(4), 1747–1766. https://doi.org/10.1177/0143831X211029382 36