The year 2000 marked the beginning of a new era of Africa-China relations following a slump in engagement in the 1980s and 1990s, largely attributed to China’s inward-looking economic reforms that began in 1978, and a general neglect of the African continent.
However, the Tiananmen incident and subsequent isolation of China by the West necessitated China’s need for political and economic allies and hence Africa. The timing was perfect for Africa too as it was coming to terms with the consequences of the Bretton Woods policies that prescribed harsh and ineffective structural adjustment programmes in return for conditional lending and donor assistance.
The two have never looked back.
The 20-year lending spree has left a massive Chinese footprint in infrastructure, construction and manufacturing.
The establishment of the Forum on China-Africa Cooperation in the year 2000 entrenched political consultation and comprehensive engagements that factored in Africa’s immediate needs and priorities focused on development assistance. Reports indicate that 1,188 loan commitments worth US$160 billion were made between 49 African governments and Chinese financiers together with their state-owned enterprises between the years 2000 and 2020.
The 20-year lending spree has left a massive Chinese footprint in infrastructure, construction and manufacturing. These labour-intensive sectors have created massive job opportunities for locals and boosted local economies. Foreign direct investment stock has increased from a mere US$490 million in 2003 to US$43.4 billion in 2020, making China the largest foreign direct investor in Africa.
Challenges and rivalry
While these investments have been beneficial and generally well received, they have come with a fair share of challenges. The greatest challenge so far has been debt sustainability exacerbated by a lack of transparency and accountability in project financing and implementation. Resource-backed lending has been blamed for debt distress in some oil and mineral producing countries like Angola, Chad and South Sudan.
Moreover, Chinese firms have been accused of high-handedness, corruption, environmental destruction and labour abuses for a long time in Africa. They have also been accused of tendering and procurement malpractices, as well as undercutting local contractors and suppliers. The importation of massive Chinese labour and materials has been problematic despite years of attempts to build local capacity.
Most of these accusations have a good basis, but language and cultural barriers, poor corporate culture and communication skills from Chinese actors, as well as an outright intent to malign China by its geopolitical rivals who often accuse it of neocolonialism in Africa and term Chinese lending as “debt traps”, have exacerbated the situation.
Return of the West?
Due perhaps to some of the above-mentioned challenges, there has been a steady decline in Chinese lending in Africa over the last few years, but the Covid-19 outbreak was a significant turning point as it devastated economies and slowed down major Chinese development projects. The harsh economic times are forcing some African countries to reconsider their economic relationship with the Chinese. Capital-intensive mega projects are being scrutinised with some cancelled altogether.
...competition will be based on the quality, impact and priority of projects as determined by African countries.
In their quest for post-pandemic economic recovery and alternative sources of financing, African countries are casting their nets wider and actively courting traditional development partners in the West (the US and Europe) who have renewed their interest in Africa by pledging significant development support in the continent meant to contain and compete with China in Africa.
The return of the West signals a threat to China’s dominant economic influence on the continent. Outcomes will largely depend on how much the West delivers and how much China uses its economic advantage to ward off Western advances in its spheres of influence.
It is unlikely that the West will match Chinese lending and financial commitments on the continent; therefore, competition will be based on the quality, impact and priority of projects as determined by African countries. Priority sectors include health and education where the West enjoys a competitive edge. Moreover, if the US$600 billion US-led G7 partnership for global infrastructure initiative is implemented with Western values like accountability, the US would gain a significant edge over China’s Belt and Road Initiative.
New areas of cooperation
Focus has already shifted from capital intensive and debt-laden mega infrastructure projects, due to problems related to debt sustainability, into new areas of collaboration. China has started building on the Covid-19 health diplomacy momentum to explore the Health Silk Road initiative meant to advance health cooperation in Africa. Africa’s unfortunate experience during the Covid-19 pandemic concerning vaccine hoarding and the infamous “vaccine apartheid” was the wakeup call that it needs to enhance health cooperation with China to advance global health justice and equity.
For China to sustain its promising start in new areas of cooperation, it must become more responsible and accountable to the African people...
The Digital Silk Road represents new areas of collaboration between Africa and China. It emphasises digital technologies and digital economies that China seems more willing to share than its Western counterparts do. Despite concerns over the quality of Chinese technologies, data security and privacy, African countries are desperate to acquire digital technologies and a solid foundation has already been laid via China’s digital infrastructure that includes telecommunication networks, data centres, information systems, submarine cables, and overland fibre-optic cables, which are all desperately needed to spur Africa’s digital economies.
Africa’s decision to reject calls by the US and its allies to isolate China’s tech giants led by Huawei is a promising gesture to Africa-China digital cooperation. It is also a warning to the US and its allies to step up their digital engagements with Africa, rather than insist on zero-sum tech wars that the latter prefers to steer clear of.
For China to sustain its promising start in new areas of cooperation, it must become more responsible and accountable to the African people by promoting good governance to avoid the problems experienced earlier with the infrastructure and mining sectors.
Promising future despite rivalry
Suggestions that China may be pursuing cooperation with Russia in Africa in the face of heightened competition from the US and its allies are far-fetched. These assumptions are influenced by recent events in Ukraine where China and African countries have refused to take an adversarial stance against Russia.
While Russia is also trying to court African countries, sentiments from Chinese diplomats suggest that Russia and China remain competitors in Africa although their competition is expected to be less antagonistic than that between China and the US and Europe.
The appointment of Qin Gang as Chinese foreign minister also shows that China is bracing up for increased competition from the US. The new foreign minister is quite familiar with China-US policy and well-placed to contain US pressure in Africa and assert China’s position on contentious issues in a less abrasive manner. His recent visit to Africa and the assertion that Africa is a big stage for cooperation and not an arena for major-power rivalry is good for African ears, if only this were practical in the current international environment.
Africa-China relations are dynamic and enduring, constantly responding to global economic and political realignments. Its future depends on how well both parties respond to mutual interests and concerns amid competing interests from rival global powers.
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