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China in Africa: Trojan horse or friend in need? (And why the West should worry)

The future belongs to Africa. Its developing economies are increasingly diverse. Its working population is skyrocketing, whilst its natural resources are abundant (especially when it comes to clean energy – think lithium). Soon, its strategic geographical position could see it become the epicentral thread in a web of global trade networks bridging East and West. 

The global economy, meanwhile, needs reignition. Manifold setbacks over the past decade have depressed growth. As the world recovers and seeks to revitalise the flame, Africa – and the promise of its people – will play a central part in lighting it

Everybody knows this. Especially China. 

Yet the emphasis remains on development. Only half its infrastructure needs are being met, with the African Development Bank estimating the infrastructure need of Sub-Saharan Africa to exceed US$93 billion annually over the next ten years. 

Consequently, African nations are proactive in seeking foreign aid to help sustain development and improve regional integration by building dams, power-plants, and railways – something China’s media discourse emphasises. As a result, our focus must remain on African agency. For it is African nations that are themselves actively investing in their future.

Yet it is China which, for a long time, has signed the cheques. 

Since the launch of its ‘Going Out’ strategy in 1999, Beijing has invested increasingly in Africa, with direct investment growing more than six-fold to around US$80 billion: in 2019, it invested more than double that of the U.S. To this extent, China has so far monopolised the market for foreign investment. For years, Beijing has urged state-owned enterprises (SOEs) to penetrate local markets, taking advantage of a dynamic new phase of world trade and the hunger of developing regions for investments in infrastructure. Many are uniquely-equipped to meet Africa’s needs, having spent the past two decades gaining experience in developing infrastructure domestically. 

In this sense, China’s involvement represents, in the words of professors Giles Mohan and May Tan-Mullins, a “global realignment of Southern interests”, allowing Beijing to frame its ambitions – whatever they may be – within at least a rhetoric of global leadership and cooperation.

Its Belt and Road Initiative (BRI), evolving to become the overarching framework through which China engages with the continent, has seen billions pumped into developing projects such as Ethiopia’s Eastern Industrial Zone (EIZ) – described by the country’s former Prime Minister, Meles Zenawi, as an example of China’s “irreplaceable role” in the Ethiopian economy. The zone is 100% owned and managed by China’s Qiyuan Group.

Reports of corruption are widespread. Working conditions are under increasing scrutiny. Similar projects have been investigated for using special economic zones to side-step U.S. import tariffs. Nevertheless, so long as Chinese investment appears lucrative (and the EIZ has created more than 20,000 new jobs), China will continue to attract nations such as Ethiopia.

The consequence is that Afro-Chinese relations run the risk of becoming dangerously asymmetrical. 

The Cameroonian anthropologist Francis Nyamnjoh used the terms “eating and being eaten” to describe Africa’s vulnerability. Desperate to develop, nations such as Zimbabwe face being ensnared by the “emerging tentacles of…global extractive capitalism”. Zimbabwe’s Congress of Trade has already complained of local industries being undermined, with China’s growing presence leading to “dependency syndrome” in various sectors. Dependency theorists in the West are growing concerned.

So too are its leaders. 

Many in the West see China’s investment as a ‘soft’ means of establishing itself globally. Some even suggest that through projects such as the EIZ, Ethiopia (and elsewhere) may become Chinese “colonies”. This is certainly hyperbole. From Ethiopia’s perspective, claims of “Chinese neo-colonialism” come from “fear in the West of growing [Chinese] influence in Africa”. Often, investment stems from socioeconomic weaknesses back home, with many Chinese workers seeking greater financial opportunities building roads etc.

Regardless, it is important that we recast geopolitical issues in geoeconomic terms, and recognise that those countries investing today in such things as renewable energy-sources may become the dominant geopolitical players tomorrow. 

A good example is lithium. By 2025, Africa’s share of global lithium production is expected to leap from 0.1% to 10.6%. Lithium is crucial to a carbon-free future. It powers everything from electric car batteries to grid-scale energy storage. 

And China has a strangle-hold on the supply-chain. 

Africa’s largest lithium projects are being bought by Chinese SOEs. In April 2022, Arcadia, located in Zimbabwe and one of the world’s biggest lithium projects, was sold to Chinese investors for an 87% share. Benchmark Mineral Intelligence predicts that soon, 90% of Africa’s lithium supply will come from mines owned or partly-owned by Chinese firms. This includes an illicit trade involving tax-avoidance, not to mention allegations of human-rights abuse. For China, however, the speed with which it is able to strike deals seems to be what matters. 

The West, by comparison, is slow, unsurprising given the political risks of investing in potentially inhumane projects, in addition to public discourse surrounding mining. Yet whilst the West talks, China digs. This, compounded by U.S. policies which prioritise free-trade subsidies, threatens to see China’s grip over global supply-chains only grow tighter: Washington currently has no such free-trade agreements with Sub-Saharan Africa.

Many have condemned what John Bolton, former U.S. National Security Advisor, called “the strategic use of debt to hold states in Africa captive to Beijing’s wishes and demands…with the ultimate goal of advancing Chinese global dominance.” In Kenya (which owes US$6.83 billion in China loans), debt distress is a genuine concern.

Yet if China can be accused of laying ‘debt-traps’, so too could the West: interest rates on loans from private lenders in the West are almost double those on Chinese loans. Likewise, whilst the same cannot be said for BRI projects in places such as Sri Lanka, China shows no inclination of seizing assets off the back of defaults in Africa. Some at the Africa Policy Institute in Nairobi even speak of “silencing the narrative” on debt-traps being “peddled by the West.”

In truth, those such as President Ruto blame the entire global financial system for failing to respond to the needs of emerging economies.

The fact remains that China’s way of doing things has, in the eyes of many Africans, worked, with many viewing BRI projects in a positive light. How else are we to explain the enthusiasm of everyday Kenyans such as Ms Echesa, who in referring to Kenya’s Standard Gauge Railway advocated “[further] sacrifice to pay the debt and get more for such [BRI] projects”. 

For many African nations, Chinese loans appear more conducive to longer-term development. Moreover, unlike the IMF’s, they aren’t conditional on reform – a selling-point Xi Jinping emphasises. “We have a high degree of agency,” Ethiopia’s deputy economic commissioner has been quoted as saying, “yet Western countries try and advise us about what our…law should be.” 

Rapid investment in infrastructure can also help bolster the legitimacy of ruling regimes, and it is little surprise that the majority of support comes from ‘upstairs’ – that is, political élites.

The ‘downstairs’ view is often very different. 

Nevertheless, for African governments desperate to develop, China represents a viable way forward.

The question, therefore, is how the West makes sense of all this – and more importantly, how it responds. Since 2022, both the G7’s Partnership for Global Infrastructure and Investment and the E.U.’s Global Gateway have, between them, promised US$600 billion in investments. With domestic infrastructure dead in the water (HS2, for example), justifying this will prove difficult. Even if its effectiveness is stymied by poor risk management, China has a massive head-start. 

Perhaps the threat is overblown. After all, China’s “grand-strategy” at times seems incoherent, or at least complicated by competing internal interests. What matters is how Africa chooses to move forward: how it seeks to foster greater regional trade, and integrate national markets into the global supply chain. As one Ethiopian official put it: “We should play the East…and West to our advantage.” For the West, however, China’s head-start must seem rather worrying.

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