China’s flagship economic cooperation program is making a strong comeback after a slowdown during the global pandemic, with a renewed focus on Africa.
- China’s involvement in Africa remains predominantly extractive and has sparked concerns in European public debates
- Chinese investment in Africa surged by 114% last year, mainly directed towards crucial minerals
- Chinese sovereign lending for Africa’s infrastructure is at its lowest level in two decades
A Reuters analysis of lending, investment, and trade data shows this resurgence.
Chinese leaders have cited the billions of dollars committed to new construction projects and record levels of two-way trade as proof of their dedication to supporting Africa’s modernization and fostering “win-win” cooperation.
However, the data reveals a more complex relationship, one that remains predominantly extractive, and has so far failed to live up to some of Beijing’s rhetoric about the Belt and Road Initiative, an ambitious infrastructure development program seeking to link China with markets and economies across the globe.
China’s involvement in Africa has sparked concerns in European public debates and among policymakers.
With a desperate need for raw materials and energy to fuel its expanding manufacturing sector, China has prioritized the continent almost as highly as Shanghai in its business agenda.
Last year, Chinese investment in Africa surged by 114%, as reported by the Griffith Asia Institute at Australia’s Griffith University. However, this investment was predominantly directed towards minerals crucial for the global energy transition and China’s efforts to rejuvenate its struggling economy.
Some $7.8 billion of that went to mining, like Botswana’s Khoemacau copper mine, which China’s MMG Ltd bought for $1.9 billion, and cobalt and lithium mines in countries including Namibia, Zambia and Zimbabwe.
As attempts to increase other imports from Africa, such as agricultural products and manufactured goods, falter, the continent’s trade deficit with China has ballooned. Chinese sovereign lending, once the primary source of financing for Africa’s infrastructure, is now at its lowest level in two decades.
Moreover, public-private partnerships (PPPs), which China has promoted as its new preferred investment model worldwide, have yet to gain traction in Africa.
“This is something late-19th century Britain would recognize,” said Eric Olander, co-founder of the China-Global South Project website and podcast. China rejects such assertions.
“Africa has the right, capacity and wisdom to develop its external relations and choose its partners,” China’s foreign ministry told Reuters.
“China’s practical support for Africa’s path of modernization in accordance with its own characteristics has been welcomed by an increasing number of African countries.”
Source: Business Insider Africa