Deeq A. Posted September 3 Having faced accusations of creating debt traps, China has changed the way it pours money into Africa. President Xi Jinping will have a smaller checkbook when he welcomes heads of state from the continent in Beijing this week, and future loans will need to be more beneficial for China. His government has wound down the type of lending that characterized its $1 trillion Belt and Road Initiative that sank more than $120 billion of state-backed loans into building roads, rail lines and power plants in Africa over a decade. A farmer herds livestock next to a Chinese-funded oil pipeline in Uganda. Photographer: Luke Dray/Bloomberg The program helped Beijing cement relationships that enabled it to lock in access to energy and minerals, while providing an outlet for its pent-up industrial capacity. The ninth Forum on China-Africa Cooperation, the biggest diplomatic event Xi will host this year, will highlight how the Asian nation’s focus has shifted toward more opaque, public-private partnerships. Such deals — like the financing for the $20 billion Simandou iron-ore mine and railway in Guinea and the $5 billion East African Crude Oil Pipeline on the other side of the continent — have a distinct advantage. The funding doesn’t add to African countries’ officially declared debt burdens, which will spare China from being blamed if they default, as three have in recent years, in part because of their liabilities to Beijing. Nigeria’s Bola Tinubu, Paul Kagame of Rwanda, South Africa’s Cyril Ramaphosa and dozens of other leaders are attending the gathering — the first of its kind to be held in the Chinese capital since 2018. Despite China’s new approach, many of those attending will be hoping for deals and are banking on Beijing’s largess continuing as it looks to consolidate its position as the dominant foreign economic power in Africa. Source: Bloomberg The post Africa: China’s new embrace appeared first on Puntland Post. Share this post Link to post Share on other sites
