February 5th, 2021

As the battle for the ‘soul’ of Africa intensifies

By : AfriChat

For more than two decades now, China has been both the largest trade partner and largest bilateral creditor in Africa, with Sino-African trade topping $200 billion per year. According to reports, since the year 2000, “China has built over 6,000 kilometres of rail, 6,000 kilometres of roads, about 20 ports, and over 80 large-scale power plants, industrial parks, and special economic zones, the AU headquarters and also, awarded over 120,000 scholarships”.

Obviously, Africa has been in dire need of infrastructure development, and China has shown it has what it takes to satisfy that need. According to analysts, over “10,000 Chinese-owned firms are currently operating throughout the African continent, and the value of Chinese business there since 2005 amounts to more than $2 trillion, with $300 billion in investment currently on the table. Africa has also eclipsed Asia as the largest market for China’s overseas construction contracts”. It was in a bid to maintain that landmark that Beijing announced a $1 billion Belt and Road Africa infrastructure development fund. It also announced an enormous $60 billion African aid package. Even before the Belt and Road Initiative was formally announced in 2013, China was already making a significant impact on Africa’s urban development needs. You do not need to wonder any longer why Africa has continued to maintain a robust economic relationship with China.

“The reasons for this ubiquitous presence are rather straight forward; many African contractors simply don’t have the capacity for major development projects, so if you want to do large-scale construction, you either turn to a western firm or to a Chinese firm, but the Chinese firm is always able to undercut you on price”, another analyst averred.
President, Muhammadu Buhari’s response during the visit of the Chinese Foreign Minister, Wangi Yi, in January 2021, lays credence to the fact that Nigeria is a big beneficiary of Chinese support for infrastructure development.

“Sustainable development is impossible when a country is hobbled by severe infrastructural deficits. We thank China for its support to us in various ways; rail construction, road, power, defence, and many others. You are helping us to reduce our severe infrastructural deficits, and we are glad. There cannot be sustainable development without infrastructural development”, President Buhari had said.

Most African countries fall into the same category as Nigeria since Africa has become the fastest urbanizing region of the world, with rural dwellers moving into cities. The exodus poses enormous challenges actually but at the same time, opens up an opportunity for any country ready to “risk billions in an infrastructure building revolution, and no country has answered Africa’s call quite like China”.

Reports have it that by “2050, Africa’s 1.1 billion person population is slated to double, with 80% of this growth happening in cities, bringing the continent’s urban headcount up to more than 1.3 billion. The population of Lagos alone is growing by 77 people per hour. By 2025 more than 100 cities in Africa will contain over a million people”. President Xi Jinping of China once corroborated that projection when he said, “Inadequate infrastructure is believed to be the biggest bottleneck to Africa’s development.” This only means that China may be competing with more countries from the West, which may want to enter into a more robust relationship with Africa, to solve her future infrastructural deficit.

The rise of China and its influence on Africa does not end with its support for infrastructure development of the Continent. There are now about ten Thousand small businesses owned by Chinese in Africa. Also, more African students are said to be studying in China currently than in America and Britain put together.

But then, while China is to be highly commended for the support for infrastructural development of Africa, many frowns that it has primarily been through loans, more so, the “civil works are not awarded through competitive bids and are limited to only Chinese companies when compared with the US” which is unrivalled when it comes to providing grants for African infrastructure. Reports say, “Between 2005 and 2020, African countries have accounted for about 53% of countries receiving grants through Millennium Challenge Corporation. Over 55% of those grants went to finance infrastructure” which experts say it is not enough if America wishes to counter China.

A top aide of President Joe Biden hinted recently that Biden would impose costs on China but also work to repair democracy at home in a bid to win the emerging rivalry between the world’s top two economies. Part of his strategy, according to Jake Sullivan, the national security advisor, may include “renewing alliances and robust investment in technology to ensure the United States retains a critical edge”. It does not stop there. The Biden administration is said to be already “shaping up to be beneficial for Africa as several of the first 17 Executive Actions covered Africa”. The US may also want to deliver clear benefits for “Africa through mobilizing support for COVAX as well as helping to resolve the pandemic-induced debt crisis”.

As the battle for Africa intensifies, experts are of the opinion that the US may as a matter of urgency, need to have a response to China’s Belt and Road Initiative instead of Just “warning countries off Chinese infrastructure financing and offering nothing in return”. “The US needs to compete with China’s ‘economic statecraft’ around the world and build partnerships distinguished from president Xi Jinping’s signature Belt and Road Initiative.”, Janet Yellen, the treasury secretary-designate was quoted to have said, during her Senate confirmation hearing.

Presidents Barack Obama and Donald Trump initiated the Power Africa and Prosper Africa respectively, which impacted immensely on Africa, and experts suggest Biden build on them.
“Since June 2019, Prosper Africa has directly supported more than 280 deals to close across more than 30 African countries for a total value of over $22 billion,” Victoria Whitney, chief operating officer of Prosper Africa under Trump disclosed. It won’t be surprising if Biden thinks about scaling up this financing to achieve a better result.

While the US is pushing to gain more grounds in Africa, China is, on the other hand, working tirelessly to maintain its relations with the continent. In a veiled warning to keep competitors at bay, Wang Yi said, “Nowadays, the world is becoming less peaceful, especially in recent years, unilateralism and power politics prevailed, the Cold War mentality is overflowing. There is an urgent need to strengthen communication and coordination between China and Africa, reveal the power of solidarity, send a common voice, safeguard the legitimate rights of the Chinese and African people to oppose outside interference, pursue fairness and justice, and lead a better life.”
However, considering the rise and rise in the amount of infrastructure-induced debt hanging on Africa’s neck and, more debts that may accrue in future, sceptics fear that Africa is plunging into “debt traps or worse still, a new form of colonialism”.
Nevertheless, the 8th Forum On China-Africa Cooperation (FOCAC) meeting is billed to take place this year in Dakar, Senegal and it’s expected that China will adopt more workable strategies to further strengthen its bilateral relations with Africa.