The Drivers of Chinese Businesses Strategy for Expansion into Nigeria - Dissertation Example

The Drivers of Chinese Business Strategy for Expansion into Nigeria Introduction Research Problem China’s association with Nigeria have developed within the previous ten years from the sporadic and restricted contact which marked the instantaneous era of after-independence to an ever more expansive and convoluted engagement (Utomi 2012: 1). Similar to other countries of Africa of the 1960s as well as the 1970s, Nigeria viewed China as an independent developing nation. Therefore, Nigeria never did much in fostering special ambassadorial correlations or business with the Asian giant. Nigeria mainly focussed its trade relations on North American and European nations that crowned themselves as partners of development (Adisu, Sharkley & Okoroafa 2010: 3). The political and economic hardships that faced China at that time qualified it to be an implausible partner of development. Subsequent to the policies of Deng Xiaopeng of the 1970s and1980s, Chinese spectacular innovation and intensification, industrial attendant and demands of market expansion, plunged it into inevitable contact with the African continent (Utomi 2012:1). Its fresh extended presence provided a relationship viewed by several stakeholders as a substitute and replica of Western partnerships. In fact, the augmenting presence of China in Africa, and particularly in Nigeria has elicited a lot of issues concerning the rising relation’s model. A national discussion across sectors upon that relationship would be a practice which is healthy and may impel additional scrutiny (Taylor 2012: 111). In point of fact, viewpoints in Nigeria are far from forming a balance between the motives of China, budding rivalry with Western associates or renewed collaboration possibilities between new and old partners. The focus of this proposal is the drivers of Chinese business strategy for expansion into Nigeria. The study is grounded on cross-examining the officials of Nigerian government, business people, and the private sector. Research Objectives The broad purpose of this research proposal is to explore the drivers of Chinese business strategy for expansion into Nigeria. In this scenario, China uses clever tactics to create room for expanding business operations in Nigeria. On the other hand, Nigeria benefits when the Chinese involve themselves in foreign direct investment. In comparison to Nigeria’s conventional Western business partners, China seems to have better terms, thus gaining more ground in Nigeria. The research questions that arise from the above perspective are; What are the drivers of China’s business strategy for expansion in Nigeria? Do Nigerian’s benefit from Chinese involvement in business? Does the China-Nigeria business relationship substitute Nigeria-Western business relationship? Key Literature According to Utomi (2012: 4), Nigerian government welcome the involvement of China within their country. The officials view the potential for large advantages for people of Nigeria though they also show some reservations regarding the number of negative results from Chinese intervention. On their part, the Chinese have come up with an aid policy having no strings attached. Additionally, China has pursued projects that are described by Nigerians as very productive to the economy (Rotberg 2008: 92). For example, the Chinese have donated fire fighting equipment to a Southwest Nigeria state that was intended for immediate use. China is not confined to project’s justifications which is a tradition demanded by Western development partners. The other driver of Chinese business strategy in Nigeria is their capability to trade with a cheaper economy in comparison to Nigeria’s long-established partners (Oxford Business Group 2013: 46). In this scenario, Nigerian businessmen value the capability to buy affordable and cheaper merchandise. As such, the Chinese are supported by businesspeople because they have expressed their interest in expanding skills from Chinese businesses and manufacturers. This has enabled a number of Nigerians to produce and export commodities. This has come at a time when Nigeria is being faced with disintegration in deindustrialization and manufacturing (Oxford Business Group 2013: 48). In spite of Nigeria’s operational challenges, Chinese business people are capable of shipping goods from Nigeria to China. This is attributed to reduced costs of transportation and increased incentives. In addition, the Chinese partners arrange for funding for the Nigerian business people. This has been viewed as a chance of engaging in joint investments while Nigerians obtain knowledge about Chinese business practices (Dijk 2009: 76). Moreover, the Chinese expatriates also seem to adapt to similar conditions of living offered to local Nigerian workers. Nigerians assert that this scenario is an obstacle when doing business with other countries’ expatriates. Furthermore, the Chinese expatriates are hired more affordably in comparison to those of Western multinationals. As pointed out by Liegl and Landovsky (2013: 173), the China’s investment profile strengthened after they bought stake in Standard Chartered Bank, which is among the leading banks in Africa, and some in IBTC-Chartered Bank of Nigeria. Also, banks in China support Chinese businesses operating in Nigeria. Therefore, Chinese business engagements in Nigeria are anticipated to expand significantly. According to Hanaeur, Morris and Rand Corporation (2014: 74), the Chinese have shifted their outreach to the local communities. In this case, retail markets of china have increased direct contact with the Nigerians. The footprint of China in Nigeria and Africa at large has increased tremendously. Methodology The method of data analysis to be employed in this research proposal is thematic analysis. Thus, huge amounts of information on the drivers of Chinese business strategy for expansion into Nigeria from varied sources would be reduced in order to seem sensible. As such, thoughts which highlight on the research questions would surface. Descriptive information would be taken and its interpretation or explanation would be given (Harding 2013: 4). The information would comprise of secondary sources from interview transcripts, books, and journals among others. Purposive sampling would be used in the research proposal. As such, specific individuals having business relations with the Chinese would be selected for the study. Research Table The research table would offer the various activities and time frame within which all the research related activities will be undertaken. In this scenario, secondary data sources such as government printed sources, books, journals, and newspaper reports among others will be utilised. Activity Commencement date Completion date Work on research proposal January 2015 20 February 2015 Filling of ethics approval form February 2015 30 April 2015 Meet with supervisor May 2015 November 2015 Doing literature review April 2015 Take 3 weeks before submitting Setting research questions April 2015 May 2015 Data collection June 2015 September 2015 Data analysis July 2015 October 2015 Writing up September 2015 November 2015 Submission 5 December 2015 References Adisu, K., Sharkey, T. & Okoroafo, S.C. (2010) “The Impact of Chinese Investment in Africa”, International Journal of Business and Management, vol. 5, no. 9. Chellaney, B. (2011) Water: Asia’s new battleground, Washington, D.C, Georgetown University Press. Dijk, M.P.V. (2009) The new presence of China in Africa, Amsterdam, Netherlands, Amsterdam University Press. Hanauer, L., Morris, Lyre, J. & Rand Corporation. (2014) Chinese engagement in Africa: drivers reactions, and implications for U.S policy, Santa Monica, CA: RAND Corporation. Harding, J. (2013). Qualitative data analysis from start to finish, London, Thousand Oaks, Calif, Sage. Oxford Business Group. (2013) The report: Nigeria, London, Oxford Business Group. Riegl, M. & Landovsky, J. (2013) Strategic and geopolitical issues in the contemporary world, Newcastle upon Tyne: Cambridge Scholars Publishing. Rotberg, R.I. (2008) China into Africa: trade, aid, and influence, Washington, D.C, Brookings Institution Press. Taylor, S.D. (2012) Globalization and the cultures of business in Africa: from patrimonialism to profit, Bloomington, Indiana University Press. Utomi, P. (2012) China and Nigeria, viewed November 25, 2015 from . Read More