The ninth edition of the Forum on China-Africa Cooperation (FOCAC) concluded last week in Beijing. This triennial summit attracted leaders from more than 50 African countries for a diplomatic fanfare of lavish state dinners, deal signings, and photo-ops meant to showcase the strength of China’s relationship with the African continent. Like the last edition of FOCAC in 2021, this one took place against the backdrop of economic slowdown in China, rising U.S.-China geopolitical tension, and a ballooning debt problem in Africa. Laurie Chen and Joe Cash from Reuters reported on the headline-grabbing news of Xi Jinping’s commitment to provide $51 billion in funding to Africa:
China, the world’s biggest bilateral lender, promised to carry out three times as many infrastructure projects across resource-rich Africa despite Xi’s avowed new preference for “small and beautiful” schemes based around selling advanced and green technologies in which Chinese firms have invested heavily.
The Chinese leader committed 360 billion yuan ($50.70 billion) in financial assistance over three years, but specified that 210 billion would be disbursed through credit lines and at least 70 billion in fresh investment by Chinese companies.
Smaller amounts would be provided through military aid and other projects.
At the 2021 China-Africa summit in Dakar, China promised at least $10 billion in investment and the same again in credit lines. This time, the financial assistance would be in yuan, in an apparent push to further internationalise the Chinese yuan. [Source]
Other significant pledges emerged from the summit. Xi formally elevated diplomatic ties with all African countries that have relations with China to the “strategic” level. He also promised to eliminate Chinese tariffs on products imported from 33 of the least-developed African countries. China pledged to create at least one million jobs in Africa. On the sidelines of the summit, African leaders signed a plethora of deals related to cooperation in infrastructure, agriculture, mining, energy, trade, and other areas.
Leading up to FOCAC, Weibo shared a weekly censorship bulletin indicating that it had banned at least one user for their harmful remarks about China-Africa relations. It urged users to maintain a positive atmosphere in discussions about FOCAC. As CDT Chinese documented, while Chinese social media platforms limited comments under posts about FOCAC, netizens flocked to foreign platforms to voice their criticism. Some criticized Xi’s announcement that China would provide $51 billion to Africa by calling him “Big Spender” (Dà Sābì, 大撒币), a derisive nickname that sounds similar to “stupid cunt” (shǎ bī, 傻逼) and has been periodically censored online since at least 2016. Some of these critical comments have been translated below:
Hanbris: So begins a new round of handouts.
Jack Li: Big-spender King Gesar [a veiled reference to Xi Jinping]. He plunders the Chinese people’s hard-earned money to feed countries in Asia, Africa, and Latin America.
湾区范儿: African ruling-class officials have lined their pockets, and the few ordinary people able to study abroad in China have also benefited, while the rest of the populace has to continue tightening their belts to pay off loans for Chinese infrastructure projects. [Chinese]
Chinese loans to African countries reached a seven-year high last year, and debt was the elephant in the room during last week’s summit. The issue went unmentioned in Xi’s speech, but U.N. Secretary General Antonio Guterres stated that Africa’s debt situation is “unsustainable and a recipe for social unrest,” adding, “They have no access to effective debt relief, scarce resources, and clearly insufficient concessional funding to respond to the basic needs of their population.” But South African President Cyril Ramaphosa said on Thursday that Chinese investments in Africa are part of a mutually-beneficial relationship and are not pushing the continent into a “debt trap.” As The Economist reported last week, murky capital flows complicate assessments of China’s lending relationship with Africa:
The more commonly cited data may be underestimating the scale of China’s lending. Bradley Parks, the executive director of AidData, a research lab at William & Mary University in America, agrees that there has been a measurable “bounceback” in lending in recent years (though volumes remain far off their peak). But he adds that “much of what we think is going on in the world of Chinese lending is based on where the light is shone”. Datasets that focus only on the activity of a small group of Chinese state-backed lenders, such as the two biggest, Export-Import Bank of China (known as Exim) and China Development Bank, do not tell the full story.
Casting a wider light means considering an array of Chinese creditors—both public and private—as well as different types of loans. These include those denominated in yuan, rather than dollars, as well as packages involving multilateral or even Western banks. China also offers emergency-rescue lending to central banks, for example in the form of currency swaps. Chinese banks get involved in special-purpose vehicles established to fund individual projects while keeping debts off the government’s books.
The picture that emerges is more complex than the traditional sovereign debt of decades past. “What we are seeing is a diversification of forms of financial support,” says Robert Dussey, the foreign minister of Togo. Take all of it into account and the volume of lending is several times higher than alternative estimates (see chart). [Source]
Nonetheless, Xi Jinping intended to project a positive picture of China’s engagement with Africa. Cobus van Staden at the China-Global South Project described the power of China’s global messaging at FOCAC:
Chinese President Xi Jinping’s keynote speech doubled down on Chinese messaging over the last few years, not only framing China as presenting a distinct model of modernization but also linking Western modernization to its exploitation of the Global South via colonialism.
This contrasts with Western narratives of a single path to modernity via democracy, open markets, and institution-building based on universal humanist values inherited from the Enlightenment.
Instead, China’s narrative echoes accounts of Global South scholars who describe Western development (and the Enlightenment itself) as irrevocably tainted by colonialism and racism, and instead promotes divergent paths to modernization. In this context, its cooperation with Africa is framed as a joint South-South effort to rectify historical crimes.
The near-universal attendance by African leaders (similar to the queue of countries trying to join the BRICS group), in turn, shows that this approach is probably working. [Source]
