As the Chinese celebrate the government’s 70th anniversary, a new paper on Beijing’s relationships with African nations explores how Belt and Road Initiative (BRI) projects are actually being implemented – and it offers a few surprising conclusions.
The paper from the Brookings Institution in the United States is part of a two-year project called “Global China: Assessing China’s Growing Role in the World,” which looks at domestic and regional Chinese policy. The project scholars explore specific spheres like technology and security, and also share research on how and where China is developing its global relationships, often in tension with the West.
In this case, author David Dollar – a senior fellow in the John L. Thornton China Center at Brookings – seeks to better understand the African experience through BRI. What’s different about the paper is that, unlike many dire warnings from the West, it sees the potential for positive Chinese influence. It also makes clear that projects and funding in diverse African nations can’t be assessed with a one-size-fits-all template.
“Some of the major borrowers have debt sustainability problems, while others have integrated the loans from China into sound overall macroeconomic programs,” Dollar writes. “Some of the major borrowers are authoritarian countries with poor records of human rights, but other major participants are among the more democratic countries of Africa. It is hard to make simple generalizations about BRI in Africa.”
For that reason, he adds, “it would be wise for Western countries to tone down their rhetoric on BRI, as many of the projects will probably work out well.”
A different China-Africa view
That flies in the face of what the West, and particularly the embattled U.S. President Donald Trump, believe about China’s role on the continent. Dollar begins by acknowledging the usual arguments against growing Chinese influence: Beijing is pushing debt traps on developing nations. The Chinese, with their human rights record under international scrutiny, are undermining democracy and extending China’s authoritarian governance model into vulnerable nations. China cares little for environmental protection.
While there is some truth to each of those objections, Dollar sees them without the narrowly politicized lens. He relies on his decades of experience at World Bank – including five years as the China country director – and at the U.S. Treasury, where he was based in Beijing to facilitate U.S.-China economic relationships. His latter tenure ran until 2013, the same year that Chinese President Xi Jinping first proposed the plans. That depth of experience translates into more nuanced views of what Dollar is careful to note are often valid Western critiques of China’s diplomatic and investment policies on Africa.
“Many developing countries prefer to use Western finance for things like budget support, health, and education, while turning to Chinese finance for big projects in transport and power,” he notes in one example. “There is no reason why developing countries should have to choose between these alternative sources of finance (keeping in mind that there are limits to the overall amount of debt that countries can take on).”
And on the African continent, they’re not. Some of the largest infrastructure projects in recent years have been high-profile investments in nations as diverse as Ethiopia, with its $1.3 billion for the Addis Ababa-Djibouti rail line, and Cameroon in West Africa, with a $500 million Chinese loan for hydropower. BRI investment is by no means limited to China’s geographic vision of a new Silk Road land route, or to the revival of ancient maritime routes that once linked trade. “East Africa is supposed to be part of one of the BRI transport corridors, but the lending in fact is spread around to all parts of the continent, with much of it in the west and south,” Dollar writes. “BRI reaches all parts of Africa.”
Optimism as both China and Africa grow
Nor is Beijing’s investment constrained by the kind of government an African nation has, dispelling the myth that China does its business with authoritarian regimes similar to its own. Angola, Kenya and South Africa lead the Top 10 list of borrowers, according to data from the China Africa Research Initiative (CARI) at the John Hopkins School of Advanced International Studies (SAIS) used in the Brookings report.
Ethiopia and Nigeria are in the bottom two slots, with countries as wildly dissimilar as Egypt, Zambia and Congo-Brazzaville between them. Zambia, at No. 5, is the nation most threatened by Chinese debt but that’s not the only reason for its troubles.
“The external debt for the major borrowers is the same on average as for all of Africa,” Dollar writes. “IMF reports indicate that some of these countries are in sound shape in terms of their overall external debt and repayment obligations. The borrowing from China is integrated into their overall debt and budget management. On the other hand, Zambia has built up its external debt at too rapid a pace — partly though not exclusively from Chinese lending.”
There isn’t a strong correlation between the level of Chinese loans and the presence of Chinese workers either. Angola has more than any other African nation at 33,000. Kenya has some 10,000 Chinese workers, while South Africa and Egypt have far fewer still.
What the Brookings paper demonstrates above all else is an optimism about China itself, which Dollar sees as learning from its earlier lending mistakes. They’re all reasons for why Western rhetoric about Chinese loans needs to be “dialed down” while the global community encourages Beijing to be more transparent – especially in the U.S.
“Many of these projects will have net benefits,” Dollar concludes, “and unremitting hostility to Chinese lending makes the U.S. seem uninformed.”
Image: FOCAC file