China has always thought of itself as the Middle Kingdom, the center of the universe. The globalized world has traditionally been dominated by the U.S., but recent developments have shown the once lone superpower is slowly losing influence due to both current policy and competition. China has taken the signal to assert itself and accomplish its egocentric goal. Its efforts have recently been focused on one area in particular: the rising continent of Africa.
China is funneling 60 billion USD worth of investments, loans, and aid into Africa. The stunning commitment, made public by President Xi Jinping during the Forum on China-Africa Cooperation (FOCAC), is claimed to be solely for development purposes. Financial packages from China on this scale are nothing new to Africa. At the last FOCAC in 2015, China made the same investment of 60 billion USD. For years, Sino-African relations have been marked by consistent large-scale monetary support from China to advance the Asian power’s interests in the continent.
Africa is definitely seeming to benefit from the interaction. Almost every area, whether it be education, health care, or military power, has been bolstered thanks to Chinese help.
Infrastructure projects, in particular, have been widespread and extremely beneficial to the continent’s development. In 2016, Chinese companies helped establish a 4 billion USD electric rail line connecting Addis Ababa, Ethiopia, to Djibouti City, Djibouti. In 2017, Chinese investments helped Kenya construct a 3.6 billion USD railway between the capital of Nairobi to the major port city Mombasa. The same year, Nigeria negotiated financing for the 5.79 billion USD Mambilla Hydropower Station Project. These are just a few examples of the many African infrastructure developments made possible by China.
Such extensive aid cannot be doled out without some underlying reason. China isn’t just pouring money into Africa out of goodwill and benevolent generosity. While not explicit, China is buying power and influence for its advantage.
By supporting African development, China is gaining allies on the international stage, thus creating a sort of Sino-African alliance. Africa, with its multitude of national divisions, has always been a focus for international influence. With numerous African nations on one’s side, especially in the United Nations’ one-country one-vote structure, international agendas can be more easily achieved.
For instance, China’s political battle against Taiwan has been affected by Africa. In 1971, twenty-six African countries supported China and helped pass a resolution denying Taiwan representation in the U.N. Only 12 African nations voted along with the United States against China. In more recent years, as Chinese investments and development projects have increased, African nations have consistently been breaking ties with the self-governed Taiwan. Only one African nation, the Kingdom of eSwatini, has maintained formal ties. Diplomatic relations with China are impossible without following their One-China policy, a view where China has control over Taiwan, so the continent is compelled to give into Chinese demands.
The Taiwan vote was the first instance of a pro-China African voting bloc in the U.N. This bloc is still active in current international debates. In 2007, the U.N. considered sanctions on North Korea, a primary Chinese ally, over human rights abuses. Nearly all African countries voted with China or abstained. As the Taiwan vote and others have demonstrated, the U.S. is losing its grasp on the international community, and China is taking advantage of that decline.
On more economic terms, China is experiencing slowing GDP growth. The government is currently over-leveraged. It has become too reliant on debt accrued by loans to the private sector. The financial risk from this has discouraged investments. Additionally, the country is switching from an industrializing to an industrialized economy with a large, strong middle class taking shape. Its traditional lower-skilled labor pool responsible for its dominant manufacturing power is set to slowly shrink and be replaced. Africa is heavily underdeveloped, and therefore has a high potential for growth and economic exploitation. Africa lacks the capital required to initiate strong economic development, so China is contributing to kickstart the African machine and eventually benefit from it. Growth spurred by Chinese investments will lead to Chinese profit from low-skill labor markets and new consumer and production opportunities.
The Chinese private sector is already showing its presence in Africa. In comparison to state-owned enterprises (SOEs) or projects, private entities seem to have greater influence.
Chinese aid pushed for the development of and influence over Africa, but the business activities from an established private sector strengthen Chinese presence on a daily basis. China’s superior manufacturing power allows for control over African consumers by out-producing domestic industries. Additionally, services from China to Africa have recently been on the rise, a signal of China’s own developing economy. China now surpasses France, India, and the United States as the continent’s largest trading partner — evidence that the Asian power clearly knows the potential in the African market.
U.S. private interests’ attempts to curb this Chinese takeover have failed without U.S. public support. Tech companies like Google and Facebook have especially been attempting to establish a Western presence through the provision of Internet and search engine services. However, in relation to Chinese activities, there is no competition. Most of the world is avoiding significant involvement in Africa, therefore leaving China the sole benefactor of the continent.
China is also banking on the principle that many African economies are highly dependent on natural resource exportation. China’s economy is in need of the raw materials Africa has to offer. Access to Africa also gives China greater energy security thanks to access to foreign fossil fuel reserves. While the country relies on coal power from domestic mines, it also requires large importations of oil and natural gas. Access through the influence of aid, particularly for oil reserves, has been secured through agreements with Angola, Sudan, Nigeria, and others.
Additionally, east Africa is especially exposed to the greater international infrastructure investments China is making to extend its trade capabilities and political influence. The Belt and Road Initiative (BRI), a hallmark of Xi’s foreign policy, is a series of infrastructure projects to facilitate trade throughout Europe and Asia via a Chinese network. East Africa is positioned to be easily incorporated into the growing system. Defaults on debts accrued due to the initiative have been deferred on the stipulation that jurisdiction is given to China in affected areas. Sri Lanka has already defaulted on debts related to a certain port project. These debts have been forgiven in exchange for Chinese ownership, a move critics fear will be standard practice in other maritime investments. China is seeking to extend trade capabilities along with actual physical presence abroad through the initiative.
China already has six special economic zones (SEZs) established in Africa, located in Zambia, Mauritius, Ethiopia, Nigeria, and Egypt. SEZs are areas within countries where business and trade laws differ to encourage trade and investment. With more liberal economic trade policies in these areas, China has been able to more easily enter the private sector in Africa. The aforementioned incorporation into the BRI is therefore highly plausible, as similar tactics are already employed on the continent.
Is this imperialism? This interference of a country abroad to access natural resources, markets, and labor in order to expand global influence is very similar to historical European colonialism. The one thing challenging this, however, is the fact that Africa seems to be welcoming the Chinese and does not seem to be experiencing any abuse.
The main critique Western critics have is that they claim Chinese investments in Africa are causing a continent-wide debt crisis. This view is used as a reasoning to encourage African nations to reconsider aid and trade relations with China as a deep, potentially compromising dependency is formed. Additionally, the growing Chinese presence makes all development reliant on Chinese sources. If funding stopped, no other alternative sources would be left to continue development efforts.
Despite this, there are no other viable options for Africa that are as promising as Chinese investment. The U.S. is taking a more isolationist approach and drawing back from their international commitments to development investments, seen through both state actions, like troop cuts, and private sector refrain due to risk.
More traditional lenders who are still willing to be active, such as the IMF, World Bank, and some European powers, require extensive standards concerning human rights and democracy to be met for aid to be awarded. China largely ignores such requirements, making Chinese investments easier to attain. This may maintain certain political status quos since aid is no longer a motivator to address transparency or political freedom issues. Despite this, it seems that the potential for development is valued more.
China itself also acknowledges the possibility of a debt crisis. The main entity handling Chinese foreign aid to Africa is the Export-Import Bank of China. Most state investments through the bank are loans. Investors have traditionally steered clear from Africa due to the inherent risk in African projects. This point seems to be disregarded by China, as its loans have low to no interest. China is not seeking profit from these public investments, which qualifies such efforts as basic foreign aid. Xi is taking this a step further by forgiving the debts of several small African countries in addition to making a larger investment announced at FOCAC. Threats of a debt crisis seem to be unfounded, giving African leaders no reason to doubt Chinese actions. China isn’t seeking to hold the continent over debt dependency but is instead settling for influence and gains in other ways. What would China get from forcing the continent into a debt-induced calamitous state of disarray when the continent still has so much potential? Chinese leaders understand that there are things far more valuable than sheer monetary returns on loans.
Western powers also know this fact; China is working for much more than economic purposes. In early August of 2017, China officially opened a military base in Djibouti. As the base is its first foreign military base, China joins other global powers holding foreign military bases. With the connection China has with Africa, it is likely to be successful in establishing more foreign military bases. It sets a precedent for China to continue expanding its military influence and capability.
Global politics have been highly U.S.-centric for the past few decades. Thanks to the current administration’s isolationist perspective, China has been able to more freely take a hold in Africa. It is detracting the West’s influence over the continent for the benefit of the rising Asian power and setting a precedent for future endeavors in other areas around the world.
Categories: Foreign Affairs