Section A. Applicant Details
Program Code and Name
Research Methods Lecturer
Section B. Project Title (15 words)
Exploring The Drivers Of Chinese Business Expansion Strategy Into Africa And Other Developing Countries
Section C. Aims & Rationale
Aims & Rationale
China's rapid growth has attracted global attention due to the magnitude of reforms as well as the frequency at which they develop. The increasing economic strength has enabled China to participate in economic and financial coordination with many countries across all continents including Africa (Krukowska, 2018). The African continent is rich in diverse natural resources. The reserves in Africa contain more than 40 % of minerals such as chromium and cobalt, along with more than 50 % of global diamond reserves (Han, 2013). About 60% of the world's uncultivated fertile land is located in Africa and the region has significant fuel reserves, about 8% of the world's oil and gas reserves (Han, 2013). This provides a fruitful opportunity for China to expand its reach into the African market. The China-Africa trade engagement covers a wide variety of sectors including oil, mining, housing, engineering, agriculture, transport, telecommunications, media, finance, public health, and tourism, among others. Chinese participation in Africa includes robust international ties, external direct investment by private and public companies, as well as development assistance, and a growing number of contract programs (Hanauer and Morris, 2014). Since the turn of the century, the level of bilateral trade has grown and since 2009 China continues to remain the largest trading partner in Sub-Saharan Africa (SSA), comprising 14.3% of its export turnover in 2016, ahead of Germany (6%) and India (5.8%) (Krukowska, 2018). The Chinese policy is quite basic and effective, focused on expanded relations with all African countries, irrespective of their political structure or record on human rights. Chinese leaders are following a long-term coherent strategy focused on sustaining a stable international climate that enables China to develop the economic and technological frameworks required to become a prosperous and influential country (Bai, Sarkis,, and Dou, 2015). The drivers for the business expansion strategy include economic opportunities which have triggered business activities of China in Africa and other developing countries (Han, 2013). The untapped resources present in developing countries provide an opportunity for an economically stable country like China to acquire these resources for its benefit.
The economic interaction between China and other developing countries has proven to be an important and continuing focus for both scholarly study and policy review. However, there is little literature present that explores the drivers of the business expansion strategy of China in African and developing countries, creating a literature gap. China's former development drivers are running out of steam. China has benefited in recent decades from a rapid institutional transition from agriculture to manufacturing and services, rising investment rates, demographic dividends, and strong rural-urban migration (Liu and Dunford, 2016). However, China can no longer rely on several of its old growth drivers. High investment figures have raised China's capital stock and exceeded OECD levels of public sector capital stock per employee. Extra capital projects are also expected to contribute less to growth (World Bank Group, 2019). In addition to trade and investment, China's financial aid to Africa is another significant component of the economic relationship between China and Africa and plays a strategic role in driving and maintaining this economic relationship (Han, 2013). It is vital to explore the drivers of the business expansion strategy in depth and deduce any discrepancies present in the existing business expansion strategy. This is important because China is not self-sufficient in natural resources, which is why it requires expanding its business in countries like Africa (Han, 2013). It is pertinent for China to develop a sustainable business expansion strategy that enables it to expand further.
To do so, this study will analyze the key drivers of China’s business expansion strategy that have facilitated the country to grow rapidly in Africa and other developing countries and devise changes that are required for China to maintain its economic position.
Describe clearly the aims and objectives of your research project (200 words)
This research aims to explore the drivers of China’s business expansion strategy in Africa and other developing countries, to be able to scrutinize the key factors that have enabled China to attain massive success throughout the world. To do so the objectives of the research are;
To comprehend the importance of expanding businesses in the overseas market.
To evaluate the effectiveness of Chinese businesses while entering the developing nations
To determine the drivers for China’s businesses to expand in South Africa.
To provide relevant recommendations to the Chinese businesses aiming to address any weaknesses that are present in the existing business expansion strategy
What is your research question? (50 words)
How important expansion in businesses to overseas markets is?
How effective the Chinese businesses are during their expansion in developing countries?
What are the drivers for Chinese businesses to expand their businesses in Africa?
What are the relevant recommendations that can improve China’s business expansion strategy?
What will be the main contribution and/or value arising from your research project? (200 words)
This research will fill the existing gap in the literature on the drivers of China’s business expansion strategy in Africa and other developing countries. This is extremely important because China maintains an important economic position globally and these expansion projects contribute to its economy significantly (Ranta et al., 2018). Furthermore, this research can be used by future researchers to conduct more studies in this area. Most importantly, this research will provide a guideline for policymakers and business owners to form a sustainable framework of expansion in developing countries that will benefit the country’s economy and will facilitate further expansion. This is important for China because it is not self-sufficient with natural resources and depends on importing them from countries like Africa (Han, 2013). Lastly, the research will provide essential data and information that can be used by business analysts to help organizations that are planning to expand in the future take note of important factors that need further consideration.
Section D. Methodology
Describe the key concepts/variables that you will need to measure, with emphasis on how you have conceptualized them and how you might operationalize them (400 words)
The theoretical and conceptual structure describes a study route and firmly bases it on theoretical paradigms. The ultimate goal of the two systems is to make empirical results more concrete and appropriate for the theoretical structures and to ensure predictive validity (Adom et al., 2016). The theoretical structure aids scholars in bringing formal ideas into the perspective of their experiments as a reference. That places their studies in both academic and scholarly formats. The theoretical context chosen must emphasize the purpose and significance of the research (Grant and Osanloo, 2014). Multiple studies have been conducted regarding the expansion of China throughout the world (Sun and Heshmati, 2010; Yang and Zhao, 2015; Cardoza et al., 2015). Most of these studies have explored different ways the expansion of china has had an impact on the country’s economy and its contribution to globalization. However, to scrutinize the business expansion strategy of China,, it is vital to identify what caused it to expand and if there is any sustainability in China’s existing method. Upon this analysis of prior studies, the researchers of the current study developed the theoretical framework for the study based on exploring the business expansion strategy of China in African and developing countries.
Operationalization is the creation of particular analysis methods that will result in empirical observations reflecting the theory (Kaur, 2013). The current study involves measuring indirect observables. Indirect observable are the concepts involving comparatively more subtle, abstract,, or indirect observations, of which inferences play an important role. These inferences apply to presumed, typically causal relations between what is directly observed and what the term means (Dressel, 2013). Measurement is the mechanism by which the key data, ideas, or other phenomena that are being examined, are identified and given significance (Treffers-Daller and Silva-Corvalán, 2016). The key variable in the current study, are the ‘drivers’ that instigate China’s business expansion strategy in Africa and developing countries. Since there is no direct method to measure a single ‘driver’, the researchers can conduct surveys revolving around economic, political,, and social drivers for China’s expansion and categorize them according to the results.
The second variable in this study is ‘Africa and developing countries. The researchers can conduct further research about China’s business expansion theory in developing countries. Here the researcher will be investigating how different drivers justify its expansion in Africa and other developing countries. To collect data, the researcher has planned to execute a survey involving 30 Chinese businesses that are doing business in Africa to get their viewpoint about the drivers that motivate Chinese businesses to expand in Africa and nearby developing countries.
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Bai, C., Sarkis, J. and Dou, Y., 2015. Corporate sustainability development in China: review and analysis. Industrial Management & Data Systems.
Cardoza, G., Fornes, G., Li, P., Xu, N. and Xu, S., 2015. China goes global: public policies' influence on small-and medium-sized enterprises' international expansion. Asia Pacific Business Review, 21(2), pp.188-210.
Dressel, J., 2013. Indirect observable measurement: an algebraic approach. University of Rochester.
Grant, C. and Osanloo, A., 2014. Understanding, selecting, and integrating a theoretical framework in dissertation research: Creating the blue print for your house. December 2014.
Han, C., 2013. Understanding the Drivers of China’s Economic Engagement in Africa.
Hanauer, L. and Morris, L.J., 2014. Chinese engagement in Africa: Drivers, reactions, and implications for US policy. Rand Corporation.
Kaur, S.P., 2013. Variables in research. Indian Journal of Research and Reports in Medical Sciences, 3(4), pp.36-38.
Krukowska, M., 2018. China’s economic expansion in Africa–selected aspects. International Business and Global Economy, 37(1), pp.84-97.
Liu, W. and Dunford, M., 2016. Inclusive globalization: Unpacking China's belt and road initiative. Area Development and Policy, 1(3), pp.323-340.
Ranta, V., Aarikka-Stenroos, L., Ritala, P. and Mäkinen, S.J., 2018. Exploring institutional drivers and barriers of the circular economy: A cross-regional comparison of China, the US, and Europe. Resources, Conservation and Recycling, 135, pp.70-82.
Sun, P. and Heshmati, A., 2010. International trade and its effects on economic growth in China.
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Yang, H. and Zhao, D., 2015. Performance legitimacy, state autonomy and China's economic miracle. Journal of Contemporary China, 24(91), pp.64-82.