When was the last time a British Prime Minister embarked on a meaningful visit to Nigeria, Britain’s major former colonial outpost? When was the last time leaders of the most advanced Western nations like Germany, France and even the United States of America do the rounds of Africa in a seeming relay?
This happened recently and we wager it’s not by chance. As China hosted 52 African countries early September in Beijing for the 7th Forum of China-Africa Cooperation (FOCAC), the entire world watched in part apprehension and part bemusement. This is because, at each new summit, China sets new standards in multilateral relations and economic co-operation between a first world nation and a straggling African continent.
FOCAC which started in 2000 has continued to wax stronger both in terms of quality of participation and quantum of benefits accruing to African countries. With the theme: “China and Africa: Towards an Even Stronger Community with Shared Future Through Win-Win Cooperation,” Chinese President, Xi Jinping announced a unprecedented bumper basket of financial assistance from his country totaling $60 billion over the next three years.
This huge outlay of funds must have made the jaws of not a few Western nations drop considering their tokenistic aids to Africa which have left little impact.
And the Chinese are not merely bandying figures because their aggressive infrastructure-backed aids to Africa in the last two decades are quite visible across the continent. The $200m 20-storey state-of-the-art headquarters of the African Union (AUCC), in Addis Ababa, Ethiopia made a major statement about China’s new policy towards Africa.
China’s strategy is not to hand a few million dollars to African leaders some of who turn round to embezzle most of it. It has been a trend of specific, infrastructure-backed loans complete with equipment and personnel to deliver projects on target.
Apart from the AUCC, examples of such large projects abound across Africa. The 754 Addis Ababa to Djibouti standard gauge rail line which has linked landlocked Ethiopia to the Djibouti port of Dorelah is one. It must be noted that East African countries of Djibouti, Ethiopia, Kenya, Tanzania and Uganda are among the major beneficiaries of what may be described as the Chinese largesse.
Coming to Nigeria, the harvest has been bounteous too, especially in the last decade. It is reported that about $5 billion has been committed to Nigeria’s economy in just three years of the Buhari administration. The list of projects, completed, on-going and projected is long. Most of projects are highways, railways, transportation and power related; among the most critical infrastructure requirements of fledgling African nations.
Some of these are: Abuja-Kaduna Railway which was opened mid 2016 and the Abuja Rail Mass Transit which began operation in July. Other rail projects are the 615 high-speed Lagos-Abuja line; the 312km Lagos-Ibadan line; the 300km Lagos-Benin route and the 675km Port-Harcourt-Maiduguri line.
Other proposed projects are the $1 billion Abuja-Ibadan-Lagos Greenfield Expressway; $500m new terminals for four international airports; the Lekki Deepwater Port in Lagos; the massive Mambila Hydro Power project in Taraba state; the $478m solar power plant in Niger State to generate about 300mw and the 614 km Ajaokuta-Kaduna-Kano gas pipeline project.
Nigeria-China trade finance and corporate banking are being deepened first with the on-going $2.5 billion Naira-Yuan swap and a recent $850m Chinese loan to boost African trade. The Cairo, Egypt-based Afreximbank has recently secured $500m facility from the China Development Bank and another $350m from the Bank of China. While the one would help Afreximbank support infrastructure projects across Africa, the other is for bank-to-bank syndicated loans and for trade finance.
These are just a few of China’s massive economic diplomacy offensive into Africa. It is at once unprecedented and bedazzling; almost akin to America’s Marshall Plan for Europe at the end of World War 2, 1945.
While the West is surely in shock conjecturing the new map of the world 50 years hence, Africa seems full of euphoria with a dash of hysteria. China is no doubt picking up an abandoned ‘virgin’ Africa for her global leadership role tomorrow.
Only smart African countries would understand that these are loans, every kobo of it. If they are not carefully documented, managed and repaid promptly when due, they are bound to compound into trillion dollars of sovereign debts.
Bottomline: thinking African countries will seize the opportunity of the Chinese largesse to build infrastructure as a fulcrum for industrialization while unthinking ones may end up becoming bonded to China someday.