Why China is interested in Africa
China's relations with Africa

Rogue donor. Loan shark. Toxic aid. Debt trap.

China's growing financial investment into emerging markets (including African countries) has been synonymous with some iteration of the phrases above.

 

Some takeaways

  • Stories about China’s interest in Africa are easy to distort because the Asian Giant is not big on speaking about details of its commitments. This silence fuels suspicion about China's intentions in Africa. 

  • For example, President Xi Jinping’s ambitious Belt and Road Initiative (BRI) has been painted by some critics as a tool for neocolonialism.

  • To ensure African governments get a fairer deal when securing loans from China, there needs to be a concerted effort to build out favourable negotiation tactics to equip African representatives with the skills required to spot bad deals and correct or shun them.

 

Two weeks ago, multiple news sources alleged that Uganda had to give up the Entebbe Airport—its only international airport—for failing to meet its debt obligations to China. However, the Chinese Embassy in Uganda and Uganda's Civil Aviation Authority spokesperson have stated the allegations are untrue. This recent rumour of Uganda surrendering its airport to China is the latest in a series of long drawn scepticism primarily by western critics towards Chinese aid and loans.

Reports like this have come up before. In 2017, the New York Times reported that Sri Lanka formally handed over its strategic port of Hambantota to China on a 99-year lease. The reason? Well, the American publication says, the island country which the Indian Ocean surrounds was struggling to pay its debt to Chinese firms. One profound quote from the NYT story indicated that Sri Lanka's dependency on China alarmed neighbouring countries and raised panic over the long-term costs of Beijing's massive investment promises.

But, the story is that the Sri Lankan government chose to lease the port out to an experienced Chinese corporation. The $1.1 billion lease was to bolster its foreign reserves that had been battered due to debts owed mainly to Japan, the World Bank and the Asian Development Bank. So it's not just China. The detailed investigation showed that only 5% of Sri Lanka's $4.5 billion debt service in 2017 accrued to Hambantota.

These stories are easy to distort because the Asian giant itself is not big on speaking about details of its commitments. The muted stance fuels suspicion about Chinese intentions in Africa. For instance, several reports have painted Chinese President Xi Jinping's ambitious Belt and Road Initiative (BRI) as a tool for neocolonialism. Starting in 2013, the BRI leverages China's expertise in infrastructure projects and ample foreign currency to build new global trading routes.

Recipient governments of Chinese infrastructure loans don't help matters too when it comes to transparency, which leads to unhealthy speculations about these

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Adesola Afolabi

Adesola Afolabi

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