Beijing Law Review
2013. Vol.4, No.4, 155-167
Published Online December 2013 in SciRes (http://www.scirp.org/journal/blr) http://dx.doi.org/10.4236/blr.2013.44020
Open Access 155
China-Africa Legal and Judiciary Systems: Advancing Mutually
Beneficial Economic Relations
Moses N. Kiggundu
Sprott School of Business, Carleton University, Ottawa, Canada
Received August 20th, 2013; revised September 23rd, 2013; accepted October 21st, 2013
Copyright © 2013 Moses N. Kiggundu. This is an open access article distributed under the Creative Commons
Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the
original work is properly cited.
This paper provides a comparative longitudinal assessment of legal and judicial reforms relevant for
China-Africa economic relations. It draws on and extends aspects of institutional and organizational the-
ory, focusing on the concepts of convergence, alignment, hybridization, and institutional voids. Data were
obtained from publically available databases from reputable international organizations including the
World Bank and the World Economic Forum. Results point to areas where China has made progress more
than Africa, and areas where serious capacity and performance gaps remain, especially for individual Af-
rican countries. The paper provides a brief discussion of the implications for the need to build organiza-
tional capacities necessary for strengthening China-Africa economic law and advancing mutually benefi-
cial economic relations and concludes by identifying research limitations, and areas for future research.
Keywords: China-Africa Economic Law; Regulatory Reforms; Mutual Economic Benefits; Convergence;
Alignment; Hybridization; Institutions; Organizations
Introduction
It is generally accepted that the quality of a country’s judicial
system as manifested by the rule of law, justice and respect for
human and property rights, and sustainable economic develop-
ment is inextricably linked. When reforms lead to economic
growth and diversification, business transactions increase in
volume, scope, diversity and complexity; resulting in growing
demand for equally sophisticated business, legal and judicial
instruments and services. However, pre-existing or traditional
systems of justice are not sufficient to handle new demands.
This is more so for China and Africa, both of which are under-
going fundamental socioeconomic, governance and political
transformations as they seek to develop and deepen bilateral
and regional economic relations. Various attempts are being
made on both sides to put and keep in place, judicial systems,
institutions and organizations designed to provide mutually
beneficial legal protections for all legitimate actors. Hong and
Zhu (2009) provide a historical account of legal exchanges and
cooperation between China and Africa, dating back to 1874
when Ghana, then the Gold Coast, applied Hong Kong English
Law, originally enacted in 1865. The growing China-Africa
relations, especially since the establishment of the Forum for
China Africa Cooperation (FOCAC) in 2000, have stimulated
interest on both sides for legal practitioners and scholars to
study the legal and judicial systems, practices and reforms of
the other. Although progress has been made both by China and
the various African countries, challenges remain.
China’s economic reforms spurred creation of new enter-
prises, increased interprovincial trade, invited foreign investors,
and encouraged businesses and individuals to go global and
seek outside opportunities and partners including Africa. Ac-
cording to Pei (2001), the expansion of business was followed
by an increase in the number of cases filed in commercial
courts. During the period of 1979-82, the average number of
commercial disputes filed and arbitrated in the courts was
around 14,000 a year; by 1997, 1.5 million new cases were
filed… more than a 100-fold increase. At the same time, the
number of commercial disputes arbitrated by community com-
mittees, the traditional mediation mechanisms hardly increased.
As the number of entrepreneurs grew the enforcement capacity
of informal dispute resolution mechanisms weakened, suggest-
ing the need to strengthen the country’s legal and judicial for-
mal institutions. Over the same period, African countries have
made serious attempts to harmonize their commercial and bu-
siness laws in order to attract foreign investment. For example,
in 1993, sixteen African countries established the Organization
pour I’Harmonization enAfrique du Droit des Affairs (OHADA)
to simplify their respective commercial legal systems, provide
foreign and regional investors with simpler, modern comercial
laws and enhance the settlement of commercial disputes.
China has signed treaties and agreements with a number of
African countries covering areas such as avoiding double taxa-
tion (Mauritius), tax evasion (e.g. South Africa), investment
promotion and protection (e.g. Nigeria, Tunisia), and commer-
cial and judicial technical assistance (e.g. Egypt). The Chinese
government and investors would like to see more legal and
judicial harmonization among African states, especially using
established regional trade blocs such as the Economic Commu-
nity of West African States (ECOWAS), Southern Africa De-
velopment Community (SADC), East African Community
(EAC), and the Common Market for Eastern and Southern Af-
rica (COMESA) because this would reduce transaction costs,
and enhance Chinese confidence in Africa as a safe place to

M. N. KIGGUNDU
invest and do business. China promotes greater legal and judi-
cial exchanges and collaboration with Africa on a range of is-
sues including protection of international commercial transac-
tions, civil and criminal technical assistance, antiterrorism, hu-
man rights, combating corruption, illicit transfer of funds, and
arbitration of commercial disputes (Pei, 2001; Yelpaala, 2006;
Zhu, 2009). This requires fundamental reforms on both sides:
strengthening institutions and organizations, simplifying pro-
cedures, reducing transaction costs, and improving domestic
competition and global competitiveness.
The purpose of this paper is to undertake a comparative lon-
gitudinal assessment of China and Africa’s legal and judicial
reforms associated with China-Africa economic relations. As
China and Africa rise, their respective economies grow and
become more interdependent, they both require correspond-
ingly sophisticated high performing legal-judicial systems to
make, regulate, arbitrate, expedite and enforce rules governing
economic transactions. Data are provided on Africa’s readiness
to manage change in the context of globalization, capacity to
achieve development outcomes, regulatory quality, and global
competitiveness. Results point to areas where progress has been
made, and where challenges remain.
This paper is organized in five parts. The first part provides a
brief discussion of the concepts of institutions and organiza-
tions as they relate to China-Africa legal and judicial systems
for business transactions. The second part briefly reviews cur-
rent performance of China and Africa’s legal and judicial sys-
tems. The third part outlines the methodology and the sources
of data used for the study. The fourth and final parts provide the
results and discussions thereof, respectively. The paper ends
with a discussion of research limitations and points to areas for
future research.
Conceptual Framework
The paper draws on and extends aspects of institutional and
organizational theory focusing on the concepts of convergence,
alignment, and hybridization as they relate to legal-judiciary
systems relevant for China-Africa economic relations. Drawing
on the work of others (e.g. Cooter & Schafer, 2012; the Eco-
nomic Commission for Africa (ECA), 2005; Murrell, 2001;
North, 1990; Trebilcock & Prado, 2012; The World Bank,
2002), institutions are defined as rules, enforcement mecha-
nisms and intermediaries including behavioural norms by
which agents within and outside the country interact and the
organizations that implement rules and codes of conduct to
achieve desired outcomes. Institutions, like organizations can
be public, private or in between, but in all cases, they are highly
interdependent and mutually reinforcing so that reforms or
improvements in one set of institutions or organizations such as
the police or commercial courts contribute to the behaviour and
performance of other institutions (e.g. business enterprises).
Institutions can be formal or informal, and in many countries,
informal institutions are used for dispute resolution or contract
enforcement within groups, including informal lenders and
borrowers (see World Bank, 2002: 172) and traditional chiefs
or religious leaders. In its conceptualization of the determinants
of global competitiveness, the World Economic Forum
(www.weforum.org) emphasizes the importance of institutions
linking institutional success or failure to economic growth and
business development over time and across countries. For ex-
ample, government ability to legislate and improve perform-
ance of the judiciary and police is related to the degree to which
citizens and investors have confidence in the protection of their
property and human rights. Here we see the police and the
courts as manifestations of organizations rather than institu-
tions.
Using Solomon’s Knot as a metaphor, Cooter and Schafer
(2012) explain how law can end the poverty of nations. They
argue that sustained growth in developing economies occurs
through innovation in markets and organizations by entrepre-
neurs. Developing innovations, however poses a problem of
trust between innovators who have ideas and investors who
own capital. The best solution to what they call the “double
trust dilemma” between innovators and investors is the law.
They explain how unenforceable contracts, uncollectable debts,
financial chicanery, and other legal problems stifle business
ventures and cause national poverty. Using the expeditionary
economics framework (expeditionary economics focuses on
building and transforming economies in post-conflict nations),
and drawing from various databases, Looney (2012) shows
empirically that rule of law can stimulate entrepreneurship and
overall economic development even for countries like Pakistan
with serious governance and internal conflicts. Brock Dahl
(2011) argues that in order to avoid a damaging “transition gap”
similar to what happened amid regime change in Iraq and Af-
ghanistan, the international community must use its leverage
(e.g. Middle East opposition groups) to ensure that rule of law
institutions… police, judiciary, anti-corruption, regulatory and
integrity agencies… are maintained as the new governments
take shape. Accordingly, the law must accommodate socially
useful innovations, while weeding out destructions at an early
stage (www.fauffman.og/ Thoughbook, 2011: 95).
Convergence A lignm ent and Hybridiza tion
Here we introduce the related concepts of institutional con-
vergence, alignment and hybridization. Institutional alignment
and convergence refer to the extent to which the various institu-
tional performance indicators move together in the same or
different directions. Specifically, convergence refers to the
extent to which the relevant legal and judicial institutions and
organizations for a given country improve or decline together
with respect to one another and the effects on economic per-
formance. If, for example all the regulatory indicators of a
country are showing improvements together, this shows high
levels of convergence, but if some are improving while others
are not, then the legal and judicial system experiences poor
convergence of the relevant institutions and organizations,
which in turn impacts negatively on the overall performance of
the economy. Convergence is a within-country concept.
Alignment, on the other hand refers to institutional position-
ing between two or more partner economies doing business
together. Specifically, alignment refers to the extent to which
the relevant legal and judicial institutions and organizations for
the partnering economies improve or decline together over a
period of reforms. For example, if the regulatory indicators of
China and an African country like South Africa are showing
improvements together, this shows high levels of alignment,
with the expectation that the relevant legal and judicial institu-
tions and organizations from both countries (e.g. the courts,
police, regulatory authorities, and private law firms) will per-
form well and improve bilateral economic transactions. On the
other hand, if alignment is low, the institutions and organiza-
tions are not moving in similar directions in terms of reform for
the two participating countries, leading to poor performance
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M. N. KIGGUNDU
(e.g. dispute resolution, property rights protection, enforcing
contracts, etc.). High alignment leads to bilateral reinforcement
among related institutions. Unresolved disputes will be higher
for countries experiencing low alignment and vice versa.
Alignment is a between country concept.
Writing about China’s legal reforms and protection of eco-
nomic transactions, Pei advances the concept of institutional
hybridization. This refers to mixed institutional forms and or-
ganizational performance, which allow for practical accommo-
dation to emerging political or economic interest groups and
conflicting interests in society and business. Specifically, Pei
found that in China, although the legal and judicial institutions
have made significant improvements, they do not create “an
idealized version of the rule of law” (2001: 206). Institutional
hybridization is a useful concept because it addresses apparent
contractions in the administration of justice in many reforming
countries such as China and Africa. Such contradictions include:
1) Serious problems of corruption coexisting with the capacity
for fair adjudication; 2) Allowing both administrative and judi-
cial interventions in the resolution of commercial disputes; 3)
The existence of ambiguity and uncertainty in the judicial sys-
tem, while at the same time there is predictability and clarity; 4)
Apparent political interference coexisting with assertive judicial
independence, and 5) Gradual evolution towards the ideal, with
incidents of primitive practices.
These observations are important for reforming countries
such as China and Africa because they show that reforms are
not linear, but path dependent; follow a rather zigzagging, evo-
lutionary and unpredictable path. They also support the idea
advanced here of differentiating institutions from organizations.
Organizations provide the platform for institutional norms and
performance and only by understanding organizations can we
explain the apparent contractions associated with institutional
hybridization. Pei supports North’s theory of the incremental
nature of institutional evolution so that during the process of
economic or governance reforms, legal institutions and organi-
zations, even when they have been historically weak, can re-
spond to emerging demands of a changing socio-economic
environment. Hybridization impedes the development of effi-
cient markets and is characterized by variability and unpredict-
ability in system performance, thus provoking anti-establish-
ment activism.
Alignment and convergence are related to institutional hy-
bridization. With sustained high convergence… when the dif-
ferent organizations of the legal and judicial system are all per-
forming well… one would expect low incidents of hybridiza-
tion. Likewise, with low convergence… when some organiza-
tional aspects of the legal and judiciary system are performing
well while others are not… one would expect high levels of
hybridization. Between or among economic partner countries
like China and African countries, a high degree of alignment
would result in more effective, harmonious and mutually rein-
forcing legal and judicial systems. Low convergence (within
country) and low alignment (between partner countries) would
produce the least desirable international transactions, with high
levels of hybridization within and between countries. This was
the case at the very beginning of the reform efforts for China
(Chi, 2000; Redding and Witt, 2007), Africa (ECA, 2005), and
elsewhere (Murrell, 2001). For example, Murrell reported that
when the police are weak and the law courts are not independ-
ent, they tend to be biased against foreign firms, an indication
of low convergence. Likewise, as the legal and judicial system
achieves high levels of convergence, strengthening law en-
forcement organizations and according the courts independence,
there is a more level playing field for both the domestic and
foreign firms and other economic actors (see Clement &
Murrell, 2001).
Khanna and Palepu (2010: 14) discuss the concepts of insti-
tutions (hard and soft) and institutional voids. They define in-
stitutional voids as the lacunae created by the absence of mar-
ket intermediaries. In emerging economies, investors and busi-
nesses suffer from institutional voids caused by poor infra-
structure (physical and institutional), access to information (e.g.
about creditworthiness), arbitration mechanisms (when disputes
arise), and difficulties of contracting, especially with foreign
partners. The two most relevant institutions and institutional
voids for a country’s legal and judicial system and institu-
tions/organizations are the adjudicators and the regulators.
Adjudicators help parties to resolve disputes regarding the law
and private contracts, while regulators create and enforce ap-
propriate policy and regulatory frameworks. Adjudicators in-
clude commercial courts, arbitrators, bankruptcy specialists,
prosecutors and investigators. Regulators include both public
and private agencies. While institutional voids can be a source
of business opportunities (e.g. by providing services to elimi-
nate lacunae), within the legal and judicial systems, they im-
pede the effective and equitable performance of the relevant
institutions and organizations, thereby contributing to low lev-
els of convergence or alignment. For example, an underfunded
court system weakens the economy as well as access to the
system, especially for foreign investors and businesses. In Af-
rica, it is often stated that one of the impediments to private
sector development is the weakness of contract enforcement
because a lengthy court system is required to enforce them,
resulting in excessive transaction costs and uncertain outcomes.
While institutional voids are about intermediaries or lack
thereof, organizational pathologies refer to system regression
or deterioration manifested by poor performance at the organ-
izational levels. Scott (1998: chapter 12) discusses various
causes of organizational pathologies, including alienation, in-
equity, and over-conformity, all of which are potentially rele-
vant for understanding and reforming legal and judiciary sys-
tems in China and Africa. During the early stages of system-
wide reforms, organizations experience pathologies, resulting in
poorer performance than before the reforms. When practical
steps are not taken to reverse these trends, further reforms be-
come more difficulty, as affected, often powerful interest
groups mobilize for greater resistance to change. China experi-
enced this during the Cultural Revolution, and African coun-
tries had similar experiences following political independence
and the implementation of structural adjustment programs of
the 1980s. Sustainable reforms of a country’s legal and judicial
system require an understanding and practical interventions
designed to overcome performance problems caused by organ-
izational pathologies (Kiggundu, 1989: 63-4). Revolutions like
the Arab Spring are often preceded by system wide incidents of
organizational pathologies; making it hard to implement prom-
ised reforms such as restoring order, enforcing contracts or
protecting human and property rights.
While institutions define the rules of the game for actors (e.g.
buyers and sellers, investors, government and contracting par-
ties), organizations are the platforms for getting things done.
Getting the rules right is necessary but not sufficient for the
effective performance of the legal and judicial system. Al-
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M. N. KIGGUNDU
though a detailed review of the various frameworks that link
institutions to organizations is beyond the scope of this paper
(see Kiggundu, 1989; Mintzburg, 1979; Scott, 2008), we note
in passing that building the capacity for effective and credible
judicial systems in China and Africa requires dual attention to
institutions and their constituent organizations. Attempting to
reform institutions without corresponding attention to organiza-
tional improvements result in organizational drag for the entire
judicial system (ACBF, 2012). We now briefly review the per-
formance of China’s and Africa’s legal and judicial systems.
China’s Le g al and Judici al System for
Economic Management
In general, there are two legal systems in the world: Com-
mon Law and Civil Law. Common Law originated in England
and is widely practiced in Britain and countries of the former
British Empire and possessions, including most Anglophone
African countries. Civil Law, also known as the Napoleonic
code, originated in Roman law and is practiced by Germany,
the Scandinavian countries, and France, including most of
Francophone Africa. Although China has one of the oldest legal
systems in the world, present law in China is a complex mix of
traditional Chinese and foreign practices; neither pure Common
Law nor Civil Law. According to Redding and Witt
“It would be risky to classify the system now emerging in
China, except to say that it is based on a civil code, that rests
on a long tradition of state control over legal process, and the
absence of an independent judiciary, and that it is now incor-
porating at high speed a great number of new ideas from out-
side; while interpreting them into a Chinese frame” (2007:
29-30).
This may explain hybridization in China’s legal and judiciary
system. Institutions and related organizations are in a state of
flux, with highly uncertain and unpredictable behaviour and
performance. Indeed, When Deng Xiaoping started the eco-
nomic reforms in 1978; China did not have much of a legal
system for handling complex business transactions and disputes.
The judiciary, decimated by the Cultural Revolution, was in
great need of rebuilding, as was the professional legal commu-
nity. China had very few qualified lawyers or legal experts.
China’s impressive economic growth since the 1980s is due
to “massive changes in law” Cooter and Schafer (2012: 21)
because of Deng Xiaoping’s reforms, including dissolving ag-
ricultural communes, restoring private business, increased pro-
tection of property and human rights, contract enforcement, and
replacing state-led with state-protected growth. Yet, in China,
private business enterprises are predominantly owned by indi-
viduals or families, rather than publically traded companies.
This negatively affects the stability and strength of business
organizations. Although China has adopted the limited liability
form of business organization, business ownership is still pre-
dominantly personal rather than public. Traditional Chinese
culture requires business assets to be divided among family
members when parents die. This has led to the common folk-
lore that Chinese businesses are characterized by: “rags to rags
in three generations” because family fortunes rise when the
parent is a successful entrepreneur, they are sustained when the
owner is still active or when the children are able to run the
business, but fortunes begin to fall when the parent dies, chil-
dren are unable or unwilling to manage the business or when
family conflicts get in the way. China’s reported lack of trust
beyond family and close business associates (Chen & Miller,
2010: 20), makes it hard to build an effective legal and judicial
system. The attitudes and knowledge of the micro level busi-
ness decision makers determine whether they use, ignore or
evade the law. Lack of trust especially by powerful interest
groups increases hybridization. When the formal legal system is
less trusted, businesses are more likely to use informal systems
or networks, and these are not always equipped to deal with
more complex transactions or disputes. Indeed, property rights
of a complex nature cannot simply be legislated (see Lubman,
2012; Wang, 2012).
In spite of these challenges, China has made progress re-
forming the legal system for business and commercial transac-
tions and disputes. Pei’s data supports the view that China’s
emerging legal and judicial system has assumed an increasingly
important role in adjudicating economic disputes. For example,
for the period 1992-96, both the number of cases and the aver-
age amount of claims going through the courts significantly
increased, especially for regions or provinces with larger
economies (2001: Tables 6.4 & 6.5: 186-7). The data also show
that during the same period, the absolute capacity of enforce-
ment almost doubled. In its recent report, the World Bank ob-
served that China is making progress improving business regu-
lations. Since 2005, China implemented policy changes across
nine areas including a new company law in 2005, a new credit
registry in 2006 and, in 2007, the first bankruptcy law regulat-
ing the bankruptcy of private enterprises since 1949 (World
Bank: Doing Business in 2012: 9).
Yet, local and regional authorities undermined these efforts
because China suffers from local protectionism. This refers to
the obstruction of justice by local political authorities, govern-
ment agencies and law enforcement, including the police and
courts, in order to protect the economic, political and social
interests of the local communities. This is done for a variety of
reasons including: fear that enforcement could lead to commu-
nity hardship such as unemployment due to layoffs, plant relo-
cation, or movement of productive assets to other jurisdictions.
As well, state owned enterprises, especially Town and Village
Enterprises (TVEs), owned or closely associated with local
authorities, often ignore court rulings because they enjoy state
protection not available to private businesses. Here we see
China’s national efforts to build an effective enforcement ca-
pacity for business disputes being undermined by a fragmented
political system at the provincial and local levels, resulting in
low convergence and higher incidents of hybridization, making
it difficult to build a harmonious society as recently suggested
(World Bank, 2011).
Internationally and across borders, there is evidence to sug-
gest that China’s legal and judicial system has not been effec-
tive in regulating individual and corporate behaviour. Recent
studies of illicit financial flows from various developing coun-
tries (Kar & Curcio, 2011), Transparency International’s Bribe
Payers Index
(www.transparencyinternational.org/bribepayersindex), and the
international use of legal structures to hide stolen assets abroad
(Willebois et al., 2011), all point to serious problems. For ex-
ample, according to Kar and Curcio, during the period 2000-
2009, China lost an estimated US$ 2.2 trillion of illegal capital
flight by individuals and businesses, mostly from trade mis-
pricing, rather than balance of payments. Corrupt people in
China and Africa use “corporate vehicles”… corporations,
foundations, trusts… to hide assets, transfer or receive funds,
conceal their involvement in illegal international transactions,
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M. N. KIGGUNDU
and make it all look legal (Willebois et al., 2011: 2).
Regarding the propensity for corporations to pay bribes
overseas, for the period 2008-2011, executives surveyed from
different countries reported Chinese companies as the second
most likely to pay bribes behind Russia (see Bride Payers Index
Scores 2008-2011, Appendix C: p. 28). Results show that some
industrial sectors are more vulnerable to bribes than others.
Construction, oil and gas and mining were reported as the most
vulnerable sectors for paying bribes. As it turns out, these are
the sectors where Chinese enterprises, both state and private are
most active internationally, especially in Africa.
Africa’s Legal and Judicial Systems
for Economic Management
Like China, Africa is experiencing rapid economic growth,
thus giving rise to increased demand for a better functioning
legal and judiciary system. Unlike China, however, Africa is
not a single country, and so there are differences in the efforts
and progress different countries have experienced in reforming
their systems and building effective institutions and organiza-
tions. In addition to different traditional forms of legal systems,
most African countries adopted the systems inherited from the
former colonial rulers. Former French colonies use the French
civil code, while those from the former British Empire take, as
their starting point, English Common Law. As these countries
undertook economic reforms and took steps to stimulate the
economy and attract foreign investment, they looked for ways
to reform their respective business and investment laws (Hong
& Zhu, 2009; Mancuso, 2008; Yelpaala, 2006), with varying
degrees of success. In addition to the reform of regulations
designed to improve the investment climate , as documented by
the annual report of the World Bank’s Doing Business, coun-
tries have attempted to introduce the Model Law, OHADA,
arbitration, bilateral investment treaties and investment promo-
tion and protection agreements with China and other foreign
governments.
In 2005, ECA; (www.uneca.org) published the Africa Gov-
ernance Report 2005, which, among other things, provided a
detailed assessment of the state, capacity, and performance of
the legal and judicial systems of Africa as a whole, and select
African countries. The report observes that in virtually every
African country, access to justice in a quick and efficient man-
ner is problematic. The court system is slow and expensive, and
access to it is often determined by the social status of the person
or persons involved. Despite constitutional guarantees in many
African countries, there is wide-spread perception among citi-
zens that the judiciary is only partially independent. In most
African states, laws and arrangements for enforcing business
contracts are part of the law of contract. Yet, the laws of con-
tract have not been amended to take into account changes made
by the former colonial powers, much less the new circum-
stances and requirements of the reforming state and economy.
Consequently, the laws on the books do not provide adequate
guidance to judges, prosecutors and others responsible for the
administration of justice, obliged to depend for their decisions
on case law, especially in the case of Commonwealth countries,
when faced with gaps or contractions in the law.
The report provides illustrations from different countries.
The average waiting time to get justice in court in Kenya is
three years. In Egypt, the commercial legal system is so slow
that in the mid1990s, the rate of resolution of commercial dis-
putes was estimated at 36 percent. In Mauritius, although en-
trepreneurs can go to court in case of breach of contract, in
practice, the route is so tedious, costly and uncertain that most
prefer to resort to arbitration, using the Convention on the
Execution of Foreign Arbitration Awards, to which the country
has been a party since 1931. In Zambia, limited access to jus-
tice is accounted for by ineffective and poor capacity of the
Office of the Director of Public Prosecution (DPP), which is
underfunded, understaffed and lacks suitable accommodation,
and modern office equipment, including ICT (information tech-
nology and software). The report added that the office of the
DPP relied on the magistrate courts and police prosecutors,
many of whom are not trained lawyers, to prosecute cases, thus
undermining the quality and performance of key institutions
and organizations charged with the administration of justice.
However, the report also reported countries where progress
had been made. For example, in a sample of experts in Namibia,
96 percent reported that the country’s judiciary was fully or
largely independent, compared to 70 percent for Egypt, 35 per-
cent for Mali, and only 22 percent for Cameroon (ECA, 2005:
Figure 7.3; p. 204). It recommends that in order to make pro-
gress in enforcing business contracts in Africa, several capacity
building initiatives must be taken, including: 1) updating and
upgrading laws to reflect current needs and realities, 2) reduc-
ing the delay, cost and uncertainty involved in accessing the
courts, and 3) overhauling the judicial system to make it more
efficient, transparent, and accountable (ECA, 2005: 110). These
results were confirmed by earlier studies of the reform of Afri-
can institutions by Kayizzi-Mugerwa (2003), and Willborg
(2002) who found that most African countries have low quality
legal systems of institutions, which explains poor performance
of the financial sectors.
The work on illicit financial transfers (Kar & Cartwright-
Smith, 2010), the use of legal structures to hide stolen assets
(Willebois et al., 2011), and Transparency International’s Bribe
Payers Index is relevant for assessing Africa’s legal and judicial
systems. Kar and Cartwright-Smith, in a study of illicit finan-
cial flows from Africa, reported that for the 39-year period
1970-2008, Africa may have lost close to US$1.8 trillion. This
amount has not only grown on a decennial basis, but cumula-
tively, it exceeds the continent’s outstanding external debt as of
2008. These illicit flows are mostly from oil, gas and resource
exporting countries such as Nigeria, Angola, DRC, South Af-
rica, Egypt and Algeria. These are the countries with which
China has the biggest and fastest growing economic and busi-
ness relations.
Investigating the impact of litigation on the poor, Brinks and
Gauri (2012) studied and found the courts’ rulings very much
pro-poor in India and South Africa; sharply anti-poor in Nigeria.
They also found that distribution rather than obligation or pro-
vision cases, which force governments to change rules to im-
prove access to basic rights offer most hope for the poor. These
results suggest that pro-poor legal regulations are also good for
business because they can lift millions out of poverty and
enlarge the domestic consumer market.
Methods
Sample
The sample for this study is made up of China (PRC) and
sixteen African countries, which by 2010 had enacted and rati-
fied Bilateral Investment Treaties (BITS) with China. To this
we added five countries… Angola, Kenya, Mali, Tanzania and
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Open Access 160
Zambia, because of their historic and/or growing importance to
China-Africa relations. This gives a total sample of 21 African
countries. Together, these countries represent by far the largest
percentages of China-Africa economic relations… trade, in-
vestments and migration (Bodomo, 2010; Kiggundu, 2008).
These countries are grouped according to their regions or trade
blocs (e.g. ECOWAS) so as to provide a basis for comparisons
with China, within and among regions. This is because China
prefers to work with African regional and sub-regional group-
ings. According to the United Nations Conference on Trade and
Development (UNCTAD), bilateral investment treaties are
agreements between two countries for the reciprocal encour-
agement, promotion and protection of investment in each
other’s territories by companies based in either country. These
treaties cover areas such as definition and scope of investment,
admission and establishment, national, most favoured nation
(MFN), fair and equitable treatments, compensation in the
event of expropriation or damage to the investment, guarantees
of free transfers of funds, and dispute settlement mechanisms,
both state to state, state to private investors, and between or
among private parties (http://www.unctadxi.org). Therefore,
ratification of bilateral investment treaties is a good indicator of
the seriousness with which the countries involved consider their
bilateral economic and business relations, in this case between
China and each of the African sample countries.
Measures
Table 1 provides a list of the variables and sources of data
used for this study for the 2005-2012 periods. Measures are
from various publically available annual databases, produced
by reputable international organizations. Specifically, we draw
from the World Bank’s Doing Business (BD), the World Eco-
nomic Forum’s Global Competitiveness Report (GCR), the
World Bank’s Little Data Book on Private Sector Development,
the Africa Capacity Indicators Report (ACIR), and KPMG’s
country Change Readiness Index. These variables measure
various aspects of the legal and judicial systems, institutions
and organizations. The World Bank’s Doing Business is par-
ticularly relevant because its indicators reflect the quality of
business regulation in a particular economy. For example, “A
fundamental premise of Doing Business is that economic activ-
ity requires good rules—rules that establish and clarify prop-
erty rights and reduce the cost of resolving disputes, rules that
increase the predictability of economic interactions and pro-
vide contractual partners with certainty and protection against
abuse” (Janamitra Devan, Doing Business In 2011, Preface: v).
Doing Business indicators focus on two types of measures of
regulations. The legal scoring indicators such as investor pro-
tections, legal rights for investors and borrowers, which reflect
the quality of the laws on the books; and the time and motion
indicators such as registering property, enforcing contracts,
trading across borders, and the time it takes to resolve cases of
business insolvency, which measure procedures, time and cost
of completing transactions in accordance with the laws on the
books (www.doingbusiness.org). Over time, time and motion
indicators reflect actual changes (positive or negative) in the
behaviour and performance of the legal and judicial organiza-
tions and comparisons with partner countries. From the Global
Competitiveness Report, we are interested in institutional
measures of property and intellectual property protections, ju-
dicial independence, efficiency of the legal framework in set-
tling business disputes, efficiency of legal framework in chal-
lenging regulations, and reliability of police services
(www.weforum.org). From the Little Data Book on Private
Sector Development, we get measures of the years it takes to
Table 1.
Measures and sources of data.
Variables Sources of Data
1. Protecting investors* Doing Business: www.doingbusiness.org 2007-2011
2. Enforcing contracts** Doing Business
3. Registering property** Doing Business
4. Trading across borders** Doing Business
5. Judicial independence* World Economic Forum (WEF): Global Competitiveness Report (GCR): Pillar 1: Institutions
www.weforum.org/competitiveness, 2007/8-2011/12
6. Settling business disputes** WEF: GCR: Pillar 1: Institutions
7. Challenging regulation** WEF: GCR: Pillar 1: Institutions
8. Clear definition of property rights* WEF: GCR: Pillar 1: Institutions
9. Intellectual property protection* WEF: GCR: Pillar 1: institutions
10. Reliability of police services** WEF: GRC: Pillar 1: Institutions
11. Time to resolve insolvency** World Bank: The Little Data Book on Private Sector Development
www.data.worldbank.org… /data-books/little-data-book-0n-private-sector-development 2005, 2011
12. Capacity for development (overall) ACBF: Africa Capacity Indicators Report 2012 www.acbf-pact.org/aci
13. Change readiness index (overall) 2012 Change Readiness Index
www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications?change-readiness-index.pdf
Note: *Legal Scoring Indicators; **Time & Motion Performance Indicators.

M. N. KIGGUNDU
resolve insolvency cases. From the ACBF, we get the overall
measure of a country’s capacity to achieve development out-
comes. KPMG’s Change Readiness Index measures the ability
of the country’s public and private sector organizations to
manage change for socio-economic development in the context
of globalization by taking advantage of emerging opportunities,
adapting or mitigating against local and global risks
(www.weform.org/docs/WEF_Globalrisks_Report-2012-pgf, p.
3).
Results
Regulation, Competitiveness, Change Readiness and
Development Capacity
Table 2 provides a general profile of China and the twenty
one African countries, organized by regional economic com-
munities of ECOWA, SADC, North Africa, and others. The
Table also provides current (2011-2012) comparative perform
ance data on measures of regulatory quality (Doing Business),
Table 2.
Study sample general assessment: Regulatory quality, competitiveness, development capacity and readiness for change.
Economies
Regulatory Quality
DB 2010-11 Rankings &
Quadrants, N = 183
Global Competitiveness
GCR 2010-11 Rankings &
Quadrants, N = 139
Capacity for
Development ACIR:
2012, N = 42
Change Readiness Index:
Quadrants and Overall Rankings
KPMG: CRI; N = 60
China 2nd (79) 1st (27) na 1st (13th)
ECOWAS
Cape Verde 3rd (132) 4th (117) Medium (14th) Na
Ghana 2nd (67) 4th (114) High (1st) 2nd (18th)
Nigeria 3rd (137) 4th (127) Medium (6th) 3rd (|39th)
Mali 4th (153) 4th (132) Medium (7th) 3rd (35th)
Senegal 4th (152) 3rd (104) Medium (12th) 3rd (36)
SADC
Angola 4th (163) 4th (138) Very Low (38th) Na
Madagascar 4th (140) 4th (131) Very Low (42nd) Na
Mauritius 1st (20) 2nd (55) Very Low (40th) Na
South Africa 1st (34) 2nd (54) Low (28th) 2nd (26th)
Tanzania 3rd (128) 4th (113) Low (16th) 4th (53rd)
Zambia 2nd (76) 4th (115) Medium (8th) 2nd (|20th)
Zimbabwe 4th (157) 4th (136) Medium 9th) 4th (58th)
North Africa
Algeria 3rd (136) 3rd (86) na 2nd (17th)
Egypt 3rd (94) 3rd (81) na 3rd (41st)
Morocco 3rd (114) 3rd (75) Low (18th) 1st (6th)
Tunisia 2nd (55) 1st (32) na 1st (2nd)
Others
Equatorial Guinea 4th (164) na na na
Ethiopia 3rd (104) 4th (119) Medium (4th) 4th (55th)
Gabon 4th (156) na Medium (13th) Na
Kenya 3rd (98) 4th (106) Medium (2nd) 2nd (28th)
Sudan 4th (154) na na na
Doing Busi ness 2011: (www.doingbusinessin.org); Sample divided into 4 equal quadrants: Ranks 1 - 45, Quadrant 1; 46 - 91, Quadrant 2; 92 - 137, Quadrant 3; 138 - 183,
Quadrant 4; (e.g. China is in second Quadrant, 79th ranking). GCR 2011:12 (www.weforum.org); sample divided into 4 equal quadrants: Ranks 1 - 35, Quadrant 1; 36 - 70,
Quadrant 2; 71 - 105, Quadrant 3; 106 - 139, Quadrant 4, N = 139, na = not assessed. ACIR 2012 (www.acbf-pact.org): 42 countries; Maximum value = 100 points; 0 - 20
very low; 21 - 40 low; 41 - 60 medium, 61 - 80 high; 81 - 100 very high; Ghana (1st) rank out of 42; na, not assessed. 2012 CRI sample of 60 countries.
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M. N. KIGGUNDU
global competitiveness (GCR), KPMG’s Change Readiness
Index (overall, CRI), and for African countries, the Africa Ca-
pacity Indicators (ACI). Rankings from Doing Business were
divided equally among four quadrants from the top to the last.
For China, the comparative data show that over the 2006-2011
period, the rankings hardly changed… 78th to 79th, although the
absolute scores may have improved for the same period (DB
does not provide individual scores). China improved by moving
from the 3rd to the 2nd quadrant over the same period.
While China performs better than any African country in the
sample for global competitiveness (rank 27th), it is not always
the best. For example, on regulatory quality, China ranks 79th,
lower than Mauritius (20th), South Africa (34th), Ghana (67th),
Tunisia (55th), and Zambia (76th). On ACI, Ghana ranks 1st on
overall capacity for development, while surprisingly, South
Africa ranks low at 28 out of a total of 42 African countries.
Looking at the regional breakdown, overall, North Africa per-
forms better on regulatory quality and global competitiveness
(no data on ACI). The ECOWAS countries represented in the
sample seem to do better than those in the SADC sample on
ACI, but both regional blocs are low (4th quadrant) on global
competitiveness. Overall, these preliminary findings suggest
that most of the African economies studied are challenged by
poor regulatory quality, global competitiveness, capacity for
development and managing change. They also show variations
within the sample, suggesting potential challenges of high in-
cidences of hybridization and low convergence as defined
above. These results are presented below in more details.
Table 3 provides five year (2007-2011) longitudinal and
comparative data of six time and motion measures of business
Table 3.
Comparing China and Africa: Time and Motion Measures of Business Regulation and Facilitation: FYC 07-11 (Five Year Change).
Economies
Rankings
Efficiency Settling
Business Disputes Enforcing Contracts Efficiency of Legal Framework Challenging Regulations Reliability of Police Services Registering Property Trading Across Borders
China +12 +48 +13 +8 −17 −12
ECOWAS
Cape Verde +12 +42 +19 na +18 −35
Ghana +1 +5 +12 +19 +77 −28
Nigeria −7 −31 +37 −10 −6 −9
Mali −17 +7 −2 −61 +5 +13
Senegal +17 −10 +13 −18 −16 +69
SADC
Angola −16 −48 −43 na −13 −20
Madagascar −42 −47 −21 −42 0 +25
Mauritius −43 +48 +39 −65 +21 −1
South Africa +1 −42 +3 0 −22 −82
Tanzania +9 +33 +3 −1 +6 −42
Zambia +14 −35 +21 +2 +25 +20
Zimbabwe +51 −17 0 −2 +2 0
North Africa
Algeria −51 −66 −4 −40 −9 −15
Egypt −12 +14 −23 −12 +48 +62
Morocco −5 +21 0 −5 −76 −13
Tunisia −4 −38 −2 −4 −100 +9
Others
Equatorial Guinea na +19 na na −22 −41
Ethiopia +30 +25 +15 +30 +37 −8
Gabon Na −71 na na +17 −22
Kenya +19 −58 +43 +19 −14 +1
Sudan na +12 na na −11 +22
Source: Doing Business (DB) reports 2007-2011, www.doingbusiness.org; and Global Competit iveness Rep orts (GCR) 2007-8 to 2011-12, www.weforum.org. FYC = Five
Year Change in Rankings, 2006-07 to 2011-2012; + (positive sign) = positive change (improved decline in rankings) ranks); − (negative sign) = negative change (decline in
rankings); na refers to missing data (country not included in the annual report).
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M. N. KIGGUNDU
regulation and facilitation for China and the African economies.
Time and motion measures, unlike legal scoring indicators,
provide a more realistic assessment of organizational perform-
ance. Specifically, they measure the efficiency and complexity
involved in achieving the regulatory goals by recording the
procedures, time and cost to complete a transaction in accor-
dance with all relevant regulations from the point of the busi-
ness manager or entrepreneur (see Doing Business 2011: Box
1.1. p. 1). The data, obtained from the annual reports of Doing
Business and the Global Competitiveness Report, provide the
net changes in rankings of each of the seven measures over the
five year period for each of the countries studied. For example,
China scores +12 for the efficiency of settling business disputes,
which is the net (positive) improvement over the five year pe-
riod. Likewise, China, scores of −17 and −12 for registering
property and trading across borders, respectively, indicating
deterioration in rankings over the same period.
Alignment, Convergence and Hybridization
The data in Table 3 provide evidence in support of align-
ment or lack thereof, convergence or divergence, hybridization,
institutional voids, and organization performance as they relate
to business law in China and the African economies. To test for
convergence, we examine the extent to which the six measures
change together by showing improvements within each country.
For example, China shows a moderate degree of convergence
because five of the six measures show positive improvements.
On the other hand, Nigeria, with only two out of six measures
showing positive movements, provides evidence of low con-
vergence among its legal and judicial institutions and organiza-
tions for business regulation and facilitation. The data in Table
3 show that the best aligned countries are Cape Verde (4/5),
Ethiopia (5/6), Ghana (5/6), and Zambia (5/6). These countries
achieve convergence on the six time and motion measures. The
worst performing economies include Algeria (0/6), Angola
(0/6), Nigeria (1/6), Madagascar (1/6), Morocco (1/6), and Tu-
nisia (1/6). For North Africa, the data suggests a possible
source of public discontent due to deteriorating organizational
performance. South Africa is notable by its surprisingly dete-
riorating performance on significant dimensions of business
law such as enforcing contracts, registering property, and trad-
ing across borders (see Table 3).
Next we test for evidence of hybridization, which refers to
the existence of mixed institutional forms resulting in wide
swings in institutional behaviour and organizational perform-
ance. Like convergence, hybridization is a within country
measure. Table 3 provides evidence of countries with very high
improvements (positive scores) in some of the six measures and
very high negative scores. Compared to China showing most
improvements for enforcing contracts (+48), and worst per-
formance for registering property (−17), African economies
with the widest swings include Mauritius (+48 for enforcing
contracts; −65 for reliability of police services); Tunisia (+9 for
trading across borders, −100 for registering property), Ghana
(+77 for registering property, −28 for trading across borders),
and Kenya (+43 for efficiency of the legal framework to chal-
lenge regulations, −58 for enforcing contracts). These results
suggest that for these economies, we should expect incidents of
good system performance and at the same time, experience
incidents of bad or unethical behaviour and poor or even harm-
ful performance. For example, in Mauritius, one would expect
improved performance for enforcing contracts, and challenging
regulations, but deteriorating performance for reliability of
police services (see Table 3). Evidence of high incidents of
hybridization (not idealized version of the rule of law).
We now look at the evidence for alignment, which is a be-
tween country measure of the extent to which the relevant in-
stitutions and organizations change (improve) together in the
same direction, thereby reinforcing one another’s behaviour and
performance. Here we start with China and its major trading
and or investment bilateral partners. Table 3 shows that
China’s time and motion measures of business law achieve best
alignment with Cape Verde, Ethiopia, Ghana, and Zambia, and
poor alignment with Algeria, Angola, Madagascar, Morocco,
and Tunisia. Looking at South Africa, Mauritius and Nigeria,
representing China’s most favoured trading and investment
partners, we see evidence of lack of alignments. South Africa
scores −42 for enforcing contracts, compared to +48 for China,
−12 for judicial independence, compared to +19 for China,
suggesting that in these areas of business law, the two countries
are moving in opposite directions. Likewise, Mauritius scores
−43 for business dispute settlement, China +12, for judicial
independence −75 compared to +19 for China, and −65 for
reliability of police services compared to +8 for China. Again
in these areas of business law, the two countries are moving in
opposite directions. Likewise for Nigeria, data show lack of
alignment in the areas of enforcing contracts (−31 for Nigeria,
+48 for China), and reliability of police services. Lack of
alignment in institutional behaviour and organizational per-
formance among trading and investment partners creates prob-
lems for investors, managers, entrepreneurs and citizens in
general for both countries due to poor or unethical conduct.
This may raise concerns of state capture by foreign powerful
interests and illicit funds outflows.
Finally, we look at the degree of alignment within regional
economic groupings. While the data show no obvious patterns,
some general observations can be made. Within ECOWAS, the
best performing economies and best aligned with China are
Cape Verde, Ghana, and to some extent Senegal, while the ones
displaying misalignment are Mali and Nigeria. For SADC,
economies showing better convergence with China are Tanza-
nia, Zambia and Zimbabwe. As mentioned above, South Africa
is problematic. Finally, North African countries show poor
alignment with China. They all show deterioration in settling
business disputes, challenging regulations, judicial independ-
ence, reliability of police services, and except Egypt, register-
ing property and trading across borders. These findings point to
specific areas of business law in specific African countries
where the Chinese need to be aware of potential challenges
dealing with African business partners, and vice versa.
Time and Motion Measures Compared
to Legal Scoring Indicators
Tables 4 ((a) and (b)), provide comparative data for time and
motion performance indicators and legal scoring indicators for
China and the African sample for the 2006-2011 period. Spe-
cifically, for each variable, the table shows African countries
performing equal or better than China, those experiencing the
biggest declines and lowest rankings. Note that no Africa coun-
try performs equal to or better than China on enforcing con-
tracts, and twelve countries show either the biggest declines or
lowest ranks, suggesting that enforcement of business contracts
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M. N. KIGGUNDU
Table 4.
(a) Time and Motion Performance Indicators: Summary Results For China and Africa 2006-2011. (b) Legal Scoring Indicators: Summary Results for
China and Africa 2006-2011.
Indicators Equal or Better than China Most Improved Biggest Declines Lowest Rankings
Settling Business
Disputes
South Africa
Cape Verde
Egypt, Tunisia
Ethiopia
Zimbabwe
Algeria
Madagascar
Mauritius
Angola Algeria
Madagascar
Enforcing
Contracts None
China Tanzania
Cape Verde,
Algeria Angola
Nigeria Kenya
Angola Gabon
Senegal Sudan
Challenging Regulations South Africa
Tunisia
Kenya Nigeria
Mauritius
Angola Egypt
Madagascar
Angola Mali
Zambia
Zimbabwe
Trading
Across Borders
Mauritius
Egypt Tunisia
Senegal Egypt
Madagascar
S. Africa
Ghana C. Verde
Angola Nigeria
Tanzania
Registering
Property
Ghana
Sudan
Ghana Zambia
Ethiopia S. Africa Tunisia Morocco
S. Africa Kenya
Nigeria
Zimbabwe
Reliability of
Police Services
Tunisia
Senegal China Ghana Ethiopia
Mauritius
Mali
Morocco
S. Africa Kenya
Nigeria
Zimbabwe
(a)
Indicators Equal or Better Than ChinaMost Improved Biggest Declines Lowest Rankings
Judicial
Independence
S. Africa Egypt
C. Verde Tunisia
China
Ghana
Algeria Mali
Mauritius
Madagascar
Angola Algeria
Madagascar
Mauritius
Protecting
Investors
Algeria Ghana
S. Africa Egypt
Tunisia Angola
Tanzania
Zambia
Tunisia
Egypt
Gabon Mali
Morocco
Senegal
Senegal Gabon
Morocco
Equatorial Guinea
Sudan
Intellectual Property (IP)
Protection South Africa China Zambia Mauritius Angola Algeria
Clear Definition of
Property Rights
South Africa
Tunisia
China
Ethiopia
Mauritius
Algeria
Mali
Angola Algeria
Madagascar
Zimbabwe
(a)
remains a serious challenge for African countries studied. Only
South Africa is equal or better than China for intellectual prop-
erty protection, six countries show either the biggest declines
(Mauritius, Madagascar, Mali) or the lowest rankings (Algeria,
Madagascar, Angola), again pointing to challenges African
countries face demonstrating effective protection of intellectual
property rights compared to China, which is not world class
either. Time and motion results for the 2006-2011 show evi-
dence of lack of alignment between China and the African
countries on various measures of business law.
Legal scoring indicators compare China and Africa in terms
of putting the appropriate business laws on the books (see Ta-
ble 4(b)). Even here, several African countries… Angola,
Madagascar (judicial independence), Gabon, Morocco, Sudan
(protecting investors), Zimbabwe, Algeria (clear definition of
property rights), seem to be lagging with the biggest declines
and lowest rankings. Laws must be enacted by the appropriate
authorities before they can be effectively enforced. The results
here show that, compared to China, several African countries
still need to enact laws in various critical areas of business law.
Resolving Insolvency Cases
One of the tests of an efficient and effective legal and judi-
cial system for business is the extent to which cases involving
insolvency and closing a business are dealt with quickly and
inexpensively. Table 5 provides data for China and the African
economies on the improvements made in terms of time taken to
resolve insolvency cases between 2005 and 2011. Once again,
while China shows more improvements than most African
economies, reducing the time from 2.5 years to 1.7 years, most
African countries show clear lack of progress over the seven
year period (see Table 5). Only Zambia shows progress, re-
ducing the time from 3.1 years to 2.7 years. Most countries
register no improvements and a few register increased times:
Nigeria, from 1.5 years to 2.0 years, and Ethiopia from 2.4
years to 3.0 years. Overall, these results may be indicative of
divergent policy options, patterns of economic development
and differences in the interplay of critical junctures and institu-
tional drifts between China, on the one hand, and these African
economies on the other (see Acemoglu & Robinson, 2012: 109;
Studwell, 2013: 223).
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M. N. KIGGUNDU
Table 5.
Comparing China and Africa: Changes in Time in Years to Resolve
Insolvency and Closing a Business 2005-2011.
Economies Time in Years 2005 2011
China 2.5 1.7
ECOWAS
Cape Verde na na
Ghana 1.9 1.9
Nigeria 1.5 2.0
Mali 3.6 3.6
Senegal 3.0 3.0
SADC
Angola 6.2 6.2
Madagascar na na
Mauritius 1.7 1.7
South Africa 2.0 2.0
Tanzania 3.0 3.0
Zambia 3.1 2.7
Zimbabwe 3.3 3.3
North Africa
Algeria 2.5 2.5
Egypt 4.2 4.2
Morocco 1.8 1.8
Tunisia 1.3 1.3
Others
Equatorial Guinea na na
Ethiopia 2.4 3.0
Gabon 5.0 5.0
Kenya 4.5 4.5
Sudan na na
Source: The Little Data book on Private Sector Development, The World Bank,
various years.
Summary and Conclusions
This paper provides comparative longitudinal assessments of
China and Africa’s judicial reforms. Conceptually, it draws on
aspects of institutional and organizational theory and develops
the concepts of convergence, alignment and hybridization. Data
were obtained from publically available databases. Mutually
beneficial China-Africa economic relations require conver-
gence, alignment, but not hybridization. Results are at best
mixed, especially for Africa. For Africa’s rise to sustain re-
forms must be speeded up to improve legal-judicial capabilities
and organizational performance. This is needed especially at
the micro community, organizational and individual levels
where serious performance challenges remain (ACBF, 2012;
Jackson, 2012). Recently, The New York Times (September 17,
2013) reported growing tensions between China’s business
interests in the oil sector and various African countries, includ-
ing Chad, Gabon and Niger… countries with the lowest institu-
tional alignment with China.
These results have implications for China and Africa doing
business together. A high degree of African alignment with
China reassures Chinese investors of consistency and quality in
the performance of all aspects of business law and vice versa.
Hybridization increases uncertainty and risk as business part-
ners are unable to predict outcomes purely on the basis of the
merit of the case. This legitimizes extralegal (e.g. bribes, collu-
sion, influence peddling, political interference, etc.) interven-
tions as a way of hedging and managing risks, especially in
large business transactions such as infrastructure biddings. In-
volvement of the Chinese government… political, diplomatic,
military… and its state owned enterprises (SOEs) in Africa is
seen as a major contributing factor to high incidents of hybridi-
zation both in Africa and in China.
China has a role to play by building relations, facilitating
cooperation, building confidence, and providing technical as-
sistance to narrow the performance gap with its African trading
and investment partners. Strategies should go beyond broad
based approaches like FOCAC, and come up with much more
country, institution and organization focused interventions,
based on specifically identified needs. Conflict and post-con-
flict countries—Angola, Zimbabwe, and Mozambique—are
particularly vulnerable.
A recent ACBF (2008) study of the capacity needs of Af-
rica’s regional economic communities such as ECOWAS and
SADC concluded that these bodies do not have the capacity,
competencies or resources to fulfill their mandates, let alone
building capacities for members’ legal and judicial systems.
Therefore, instead of insisting on building African capacities
using regional and sub-regional groupings, we propose a more
modest but focused approach based on carefully selected coun-
tries twinning and working together: jointly strategizing, tar-
geting identified capacity gaps, sharing experiences and learn-
ing together. For example, drawing on the results above, for
improving the reliability of police services, Senegal (doing
better), could twin with Mali, Ghana with Nigeria for register-
ing property, South Africa with Angola and Madagascar for
challenging regulations, and Tunisia with Algeria for settling
business disputes. These bilateral micro-level undertakings are
more likely to produce sustaining positive results because they
are focused, targeted, easier to manage, based on identified
needs on the ground, and likely to garner genuine local owner-
ship and commitment. This approach is likely to yield better
results than bundling aid on the basis of existing regional or
sub-regional groupings. Mutually beneficial regional economic
integration requires effectively functioning legal and judicial
systems within Africa and with overseas trading partners such
as China.
In conclusion, we note that China-Africa economic relations
do not exist in a vacuum. Therefore, the results of this study
have wider implications in the global economy and global soci-
ety, including the way South-South collaborations and multi-
lateral technical assistance are conceptualized and conducted.
Although Africa continues to receive most of its FDI (foreign
direct investment) from the UK and the USA (Ernst & Young,
2011), most reforming African countries are also deepening
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M. N. KIGGUNDU
business and commercial relations with other emerging econo-
mies such as the BRICKS (South Korea & South Africa in-
cluded). For example, South Africa and Angola are deepening
relations with India, Brazil and the Middle East, with similar
implications for their respective legal and judicial systems for
international business transactions. The international commu-
nity, WTO, in collaboration with the Advisory Centre on WTO
Law (ACWL) and the International Centre for Trade and Sus-
tainable Development (ICTSD), provides technical assistance
and helps developing countries to explore new ways of han-
dling legal disputes in trade. While these and similar offsite
initiatives provide a useful basic introduction to the relevant
subject matter and wider networking opportunities for partici-
pants, their impact and sustainability on the ground would be
much more enhanced if they were followed up with the kind of
focused and targeted twining arranges as proposed here.
The study suffers from a number of limitations. For example,
it is based on secondary data collected to serve other purposes,
not necessarily specific to the study of legal and judicial institu-
tions and organizations. As well, we did not have data on the
actual performance of specific organizations or institutions for
China or the African countries studies. Not all African countries
were included in the sample, and some countries where China
is deeply involved like the Cameroon, DRC, Libya, Namibia,
and South Sudan were excluded. Published indicators like the
ones used here have inherent conceptual, methodological and
practical limitations, which future research should address. We
are also mindful of the dangers poor numbers and misleading
statistics contribute to the inaccurate assessment of African
progress and policy development (Jergen, 2013). However, the
paper offers in several places explicit and implicit testable hy-
pothesis for future considerations in different settings.
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