Understanding China’s Economic Engagement in Africa: An Exploration of the FDI-Trade Nexus

Round 1

Reviewer 1 Report

Comments

Thanks for giving me an opportunity to review this interesting paper entitled “Understanding China’s Economic Engagement in Africa: An Exploration of the FDI-Trade Nexus”. This paper investigates the nexus of China’s direct investment in and international trade with African countries between 2003 and 2014 to estimate the extent to which Chinese investments affect its trade with the continent, with the intention to shed light on the political motivation behind these economic activities. Indeed, paper has a potential for policy suggestions and a fine piece of document. However, following are my minor concerns about the paper. The incorporation of these comments can enhance the quality of paper.

Comments

1.      Please provide a specific policy outlay in abstract.

2.      The novelty of study is missing in the abstract.

3.      It is quite better to support your argument with some statistical background. Please provide the statistics on net outflow of FDI towards African economies and on other attached economic indicators like economic growth, employment etc., in introduction section.

4.      Provide the directional review of empirical literature that specifically support the underlying hypotheses.

5.      My major concern is on sample selection. Why author limit the sample period to 2014 while it is too outdated. Necessarily extend your analysis to at least 2019 or provide a strong justification of data limitation to 2014 otherwise the analysis is biased for recent policy developments.

6.      Support your results discussion with existing literature. Is the analysis robust the existing literature? If yes, then what is new in your study? If not, why your study departs from existing trend? Answer these questions in results discussion.

7.      Make the conclusion sharper and more concise to better focus on main output of study.

8.      Add specific policy outcomes of study and mention the limitation and future research agenda.

9.      The author should focus more on language check.

10.  All tables should have a bottom note of abbreviations.

 

Best of luck for your publication.

Author Response

Please see the attachment 

Author Response File: Author Response.pdf

Reviewer 2 Report

The manuscript entitled “Understanding China’s Economic Engagement in Africa: An Exploration of the FDI-Trade Nexus” is an engaging and valuable contribution to the extant literature on economic predictions. In my modest opinion, however, its content needs to be clarified to ensure interest from a broad readership. The following items may be considered:

-The authors need to spell out acronyms before using them repeatedly (see, for instance, OFDI). In many sections of the manuscript, the author's tendency to assume that terms are intrinsically familiar makes their narrative cryptic.  

 -Although the study and its findings are interesting, an introduction to the Chinese economy may be helpful to then understand its trade practices.

Each hypothesis needs to be unequivocally connected to a rationale. Its key terms must have a clearly stated operational definition. Thus, I am puzzled by the authors’ formulation of hypothesis 1 (i.e., “[t]here is a positive effect of China’s OFDI on its foreign trade in Africa”), hypothesis 2 (i.e., “China’s OFDI aims to export consumption goods to African countries”), and hypothesis 3 (i.e., “China’s OFDI aims to import more primary goods from African countries”).

For hypothesis 1, should the stated “effect” be given an operational definition? What exactly, do the authors predict? If the “effect” is inclusive of different types of goods, should there be a hypothesis for each type?

For hypotheses 2 and 3, should the actual outcome of China’s OFDI be mentioned instead of its aim? Namely, what is important is its actual actions rather than intentions.

Furthermore, how do hypotheses 1 and 2 differ? Is specificity the difference?

For hypothesis 4 (i.e., [t]he trade-promoting effect of China’s OFDI is more significant for Chinese-state-controlled MNEs), should the “effect” be given an operational definition? What exactly, do the authors predict?

-In the empirical section, the gravity model is abstractly introduced. My advice would be to introduce the gravity model and its empirical support in other markets before the authors use it in their work.

- The content of Table 3 (i.e., China's OFDI and export to Africa) needs to be clarified. A more standard presentation of the regression analysis data should be considered (see Fields, 2009). Furthermore, the authors should offer evidence that issues of concern, such as multicollinearity, have been addressed.

-The section devoted to conclusions mostly re-states the findings of the authors’ study. Should implications and applications of their research model be contemplated?

-The authors need to proofread very carefully the manuscript to ensure that typos are corrected (e.g., Chinese state-controlled MNEs).

Author Response

Please see the attachment. 

Author Response File: Author Response.pdf

Round 2

Reviewer 1 Report

the author has put effort to update the paper. now, I warrant publication.