MJIEL Vol 11 Issue 1 2014 - Article 5

Fighting the Natural Resource Curse in sub-Saharan Africa with Supply-Side Anti-Bribery Laws:
The Role of China

Jennifer Whitman

ABSTRACT: As a central component of the country’s ‘go-out’ (走出去) policy, China has invested heavily in sub-Saharan Africa’s abundant natural resources. Now the largest and second-largest investors in Africa, the United States and China find themselves at odds ideologically and in direct competition for finite resources in an oft-unstable environment. Endemic public sector corruption is one of the most destabilizing forces in sub-Saharan Africa, particularly in countries with substantial natural resource reserves (a phenomenon referred to as the ‘natural resource curse’). Bribery, the most representative act of corruption, implicates both supply-side (the bribe giver) and demand-side (the bribe receiver) interests. In recognition of the role developed countries play in corruption in international business transactions, over the past several years the United States has aggressively pursued companies under the Foreign Corrupt Practices Act (FCPA), heavily targeting both companies engaged in extractive industries and those operating in Africa. In 2011, China amended Article 164 of the Criminal Law to include an extraterritorial restriction on bribery similar to the FCPA. If enforced, the new law could go a long way in decreasing competitive disadvantage and augmenting the effectiveness of the FCPA and other supply-side anti-bribery laws. However, several factors may impede the law’s enforcement.

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