Chinese Investment and Development in African Housing

Source: SAIS China-Africa Research Initiative at John Hopkins University.  Data Chinese Investment in Africa

Increasing Chinese economic involvement in the African continent is sometimes overstated or misrepresented. On the one hand, China is indeed the number one financier of African infrastructure and the continent’s top trade partner.  Foreign Direct Investment (FDI) from China has exploded over the last decade, growing at 40 percent annually.  On the other hand, media frenzy and geopolitical concerns can sometimes misrepresent the extent and form of Chinese participation in Africa markets.

From the standpoint of the affordable housing sector, Chinese investment is an opportunity that warrants further study. It is clear that the Chinese are looking to increase their presence on the African continent.  So far, investment in affordable residential property is minimal compared to overall investment. Infrastructure remains the priority of state-owned enterprises while manufacturing remains more profitable for private firms. Within the real estate sector, the issue remains that commercial and upper-middle income properties offer profit margins that affordable residential projects do not.

This report explores Chinese investment and development in Africa’s housing sector by assessing the available data and literature, and interrogating the impacts of Chinese participation. Impacts on housing are examined through case studies based on a combination of available data, ethnographic research, and interviews with experts.  The findings of the research identify a number of key challenges to engaging with Chinese investors and developers in affordable housing in the future. These involve the existing data gap on Chinese housing sector specific projects being undertaken in African countries, misunderstanding local contexts and employment conflicts.