Chinese manufacturers are now outsourcing to Africa

America is still pretty sore over the millions of jobs — including an estimated 2.4 million in the last decade — that have been outsourced overseas, especially to China, where labor was cheap and plentiful, and economic growth rapid.

But in recent years Chinese manufacturers have begun doing the same thing — shifting manufacturing from China, where wages are rising rapidly — to cheaper countries, including ones in Asia, and especially sub-Saharan Africa.

Why? This week, Huajian Shoes' President Zhang Huarong — whose 3,500 workers in Ethiopia produced two million pairs of shoes last year — told Bloomberg: "Ethiopia is exactly like China 30 years ago. The poor transportation infrastructure, lots of jobless people."

The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

And while that may create all sorts of logistical and electricity supply problems, it also creates a massive opportunity for cheap labor and fast economic growth. "China's average manufacturing wage is 3,469 yuan ($560) per month," Bloomberg reports. That may not be much by American standards, but pay at Huajian's Ethiopian factory ranges from "$30 a month to about twice that for supervisors."

The bigger picture is that China is now Africa's largest trading partner, passing the United States in 2009. In 2012, China's trade with Africa reached $198.5 billion. And according to Mthuli Ncube and Michael Fairbanks of the Financial Times: "More than 2,000 Chinese private businesses are in Africa." --John Aziz

Editor's note: This article has been revised since it was first published in order to more clearly include proper attribution to source material.