China’s Investment in Africa: consequences for Europe

How is Chinese investment impacting Africa, and what could be the consequences for Europe?

Speech by Abraham Liu, Chief Representative of Huawei to the EU Institutions, at the panel discussion organised by Bruegel

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Good morning and thank you for having me on the panel today.

Africa is a special place for me. It was the place where I spent nine years, working in almost every country, in cities like Kinshasa, Nairobi and Johannesburg, and in many unknown villages. Africa is also a special place for Huawei. Now Huawei is a business with a revenue of 95 billion EUR, but Africa was the first stop when the company started to expand its business overseas. It was the continent that offered Huawei the first great opportunity of expanding outside China.

However, apart from the business success, what makes me most proud is the effort we have made in bridging the digital divide in Africa. I remember the day when our engineers installed a base station in one remote village in Kenya, and the villagers celebrated around the tower. When a boy spoke to his grandma in Nairobi, his face lit up. It reminded me of the scene when our village had electricity for the first time when I was 11. When I saw the bright bulb for the first time, my eyes lit up just like the small boy in the village in Kenya.

Now, with technologies like Huawei RuralStar, an innovative and simplified solution for rural areas, we are providing more cost-effective connectivity to every corner of Africa. For example, Tobolo is a remote village in Nigeria, 23 km from the nearest base station. In order to make a call, villagers had to drive their motorcycles several kilometers to find signals. On the day when RuralStar site was installed, villagers formed a long queue to buy mobile phones. As more and more connectivity is installed, mobile tariffs in Africa have dropped from 5 euros per minute in the early 2000s to several cents per minute right now. Huawei has helped millions of Africans connect to each other and the outside world.

Mobile networks also provide educational opportunities for children in Africa. Nicholas Negroponte, a tech visionary and co-founder of the MIT media lab, gave an example when he spoke to our founder last week. He said they went to two villages in Ethiopia that had no electricity. No adult had ever seen a written word. Then they introduced a number of tablets to the village, matching the number of children and outdoor solar panels, with no support staff or instructions. Within a week, the children were singing ABC songs. Within two weeks, they were using 50 apps seven hours a day (for just as long as the battery lasted). Six months later, they hacked Android. And, today, they speak, read, and write fluent English. It's amazing what kids can do, and it is mobile broadband that has provided them with the opportunity.

Although many places in Africa are still waiting to be connected, we’re pleased to see that many are also forging ahead, in some places leapfrogging 20th century ICT infrastructure and going straight to 21st century technologies without the burden of the legacy network. Through the Huawei Mobile Money solution, for example, which we launched jointly with Safaricom, the leading mobile network operator partly owned by Vodafone, the shortcomings of local banking systems are overcome and 12.8 million Kenyan people can make cashless transactions through mobile phone banking. The broadband network speed in some capital cities in Africa is even ahead of its counterparts in Europe.

And if Huawei has succeeded, it is above all due to the principle of collaboration. We work with local and global business peers such as Vodafone and Orange to make things happen. It’s also about the less restricted regulation environment which nurtures fast adoption of new technologies which even Europe may refer to.
When talking about the consequences of Huawei’s contribution to the transformation of the ICT landscape in Africa, as I mentioned above it has created new opportunities. The networks we have built already serve millions of people and these people are eager to have more Internet-enabled services. Huawei is keen to keep working with our European partners to deliver more services to the African people and to do something good for Africa.