www.beltandroad.blog
Uwe Hoering, December 15, 2021
If the 8th Forum on China Africa Cooperation at the end of November was an indicator of the intensified competition between the United States, Europe and China for Africa, Beijing kept a fairly low profile. The limited media attention given to the meeting, which was scheduled only at the ministerial level, gives the impression that most observers wanted to quickly and graciously spread the cloak of silence over FOCAC8 and its results. Although the meeting came up with all the key words of the Chinese development narrative: Partnership, Sustainable Development, Shared Future in a New Era, ….
Corona Diplomacy
Beijing was able to score points with its announcement that it would supply one billion Covid-19 vaccine doses for the continent, an image gain over the sluggish international COVAX initiative. Of these, 600 million will be free of costs, 400 million will be provided through commercial channels and “through such means as joint production by Chinese companies and relevant African countries,” according to ‘department of health politician’ Xi Jinping in his video message.
However, that is not enough to make up for the drastic drop in the immediate target figure by which the meeting’s outcome for Africa will be measured: Financial pledges have dropped by a third compared to the FOCAC meeting three years ago, amounting to about $40 billion, according to calculations by business information service Bloomberg, $20 billion less than in 2018, when Xi Jinping came to Africa in person. And this time, there were neither grants nor interest-free loans in the offer.
Apparently, Beijing is also paying attention to spending discipline in the face of financial risks, tight budgets and rising costs. And the on-going criticism that recipient countries are being driven into a debt trap also seems to be catching on. Instead of state loans, ‘innovative’ models of private financing are to be strengthened in future, for example so-called Public-Private Partnerships (PPP). In this respect, Beijing could move closer to the practice of Western donors.
There is also a discernible interest in increasing imports from Africa, including food and agricultural raw materials. Compared with around $85 billion in 2019, they are expected to amount to a total of $300 billion over the next three years. $10 billion are pledged for export promotion. Chinese companies shall invest at least $10 billion in Africa by 2024. In addition, Beijing will transfer a further $10 billion from its IMF Special Drawing Rights to African governments in order to expand their financing scope.
Magic number 10
The number 10, which according to Feng Shui signifies highest perfection and pioneering spirit, has obviously also caught the Chinese side’s fancy when it comes to other pledges. To make up for the $20 billion gap, Beijing promised its African partners ten medical and health projects, ten poverty reduction and agricultural projects, ten connectivity projects, ten industrialization and employment promotion programs, ten digital economy projects and ten projects for ‘green development’, environmental and climate protection, as well as the building or upgrading of ten schools and the invitation for 10.000 Africans to training programmes over the next three years. But beyond the numbers mystique, the announcements remained rather vague, with no specific details or financial commitments.
However, while FOCAC is a high-profile and prestigious forum for securing Africa’s political support as a friendly bloc, it is not the only vehicle for political and economic relations between China and Africa. Bilateral activities under Belt&Road, for example, operate independently. There, Chinese interests can be incorporated in a much more targeted manner, for example through trade agreements and investments. There, the specific projects in mining, ports, railway lines and pipelines, the expansion of digital infrastructure or the relocation of labour-intensive industries are realised, underpinned by credit commitments and coordinated with implementing companies.
New race for Africa
The meagre results of FOCAC8 could nevertheless be quite an advantage for the U.S. and Europe. Disappointed African governments will now take a closer look at what their recently launched B&R competition projects, the European Global Gateway and Build Back Better World (B3W) by President Biden, have to offer. The battle for Africa’s votes in the decision-making process in Global Governance institutions such as the United Nations, the competition for sales markets and the race for access to the continent’s rich natural resources are entering a new round. For Africa, this is certainly an opportunity to drive up prices and expand its scope for action.
This could also involve new ‘protection forces’, a grey area, but one that is increasingly coming into focus. “China wants to expand its ‘low-cost, low-risk, and high-yield’ security strategy in Africa given is growing interests and the security dimensions of the Belt and Road,” says Paul Nantulya of the African Center for Strategic Studies. Beijing is steadily expanding the presence of its security forces, military training programs and arms supplies, as well as its involvement in UN Blue-Helmet operations. It has its first foreign military base in Djibouti at the Horn of Africa, in close proximity to U.S. and French bases there. And ten (!) peace and security projects have also been promised at FOCAC8.
Translated with www.DeepL.com/Translator (free version)