Different views on China-Africa Cooperation and Chinese overseas investment

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Leaders from 53 African nations are taking part in the Forum on China-Africa Cooperation (Focac) Summit today in Beijing under the theme “China and Africa: Towards an even stronger community with a shared future through win-win cooperation.”

President Xi Jinping has been enthusiastic about his Belt and Road Initiative and the past week Chinese state media has embarked on a propaganda offensive on the topic of Africa.

Good or bad, we’d better take a closer look at both sides of opinions.

Chinese Aid and Investment Are Good for Africa

“Since 2000 when the FOCAC was formally founded, especially since the 2006 Beijing summit and the 2015 Johannesburg summit of FOCAC, China and Africa have seen closer ties in various respects, producing win-win results toward the goal of building an even stronger community with a shared future,” according to Xinhua.

As co-chair of this year’s summit, South Africa has ensured that infrastructure development initiatives are successfully realised to enhance intra-regional trade and attract trade and investment towards Africa.

President Cyril Ramaphosa said in his Twitter yesterday, “We are in China to enhance government-to-government, business-to-business and people-to-people relations. SA is honored that the Chinese government regards us as important strategic partners in Africa”.

Former President Jacob Zuma said earlier in a public address, “ A large number of Africa’s priority Focac projects have either been completed or are under way. Some of these projects include the Mombasa-Nairobi Standard Gauge Railway in Kenya and the Addis Ababa-Djibouti Railway project. On a bilateral level, China is South Africa’s largest trading partner, and has been so for nine consecutive years. In 2017, bilateral trade grew by 11.7% to $39.17bn – a more than twentyfold increase from the figure at the start of diplomatic relations.”

“We are pleased that China is keen to share lessons and cooperate with us in the implementation of our ambitious blue economy program, Operation Phakisa. Operation Phakisa will initially be implemented in two sectors, the ocean economy and health, especially clinics. We chose the ocean economy with good reason. “

To facilitate the implementation of the African projects, China announced in 2015 the provision of $60bn for funding support. This includes $5bn for grants and zero-interest loans; $35bn for concessional loans and export credit; and $5bn for technical and industrial project funding. Furthermore, an increase of $5bn would be added to the China-Africa Development Fund and Special Loans for the Development of Africa.

Liberia’s Economy Minister Augustus Flomo was quoted as saying: “China is a very, very important partner for our development strategy.”

China’s investment in Africa has both bad and good signs

This two-day summit in Beijing will focus on Africa’s economic ties with China amid increasing criticism of its debt-laden approach to aid in the developing world.

The fact that 53 African national and business leaders are taking part shows their favor for this event and how they have valued the importance of their cooperation with Beijing.

The growth in trade between China and Africa is actually impressive. China’s economic data shows trade between Beijing and the continent’s countries rose 14 percent last year to $170bn.

According to the United Nations Conference on Trade and Development, China-Africa trade in 2000 was $10 billion (€8.5 billion); In the 17 years since, the figure has risen twentyfold to $200 billion.

There is skepticism that China’s massive and expanding infrastructure projects are running into speed bumps as some countries begin to grumble about being buried under Chinese debt.

“Most African nations – exporting minerals and buying Chinese manufactured goods – run large deficits with China,” according to DW.

Analysts argue that the partnership will only pay off if the infrastructure projects that China underwrites are “high-quality, commercially sound, socially responsible, and well-managed”.

“‘Debt-trap diplomacy’ is a real challenge not only for the debtor nations in Africa but also for China, the creditor nation, since a heavy debt burden will inevitably complicate diplomacy both at the bilateral and multilateral levels,” Seifudein Adem, a specialist in Africa’s interactions with Asia at Doshisha University in Japan, said. “The major challenges for Chinese investments in Africa in the long run include the tension among the objectives of Chinese economic actors in Africa.” South China Morning Post reported.

Jean-Pierre Cabestan, a political scientist at Hong Kong Baptist University, said, “I think that China is aware of the criticisms that have come up in the past few months and it is going to reassure its African partners that it doesn’t want to put them into delicate financial situations,” according to VOA, “Beijing’s hosting of a massive forum for African leaders and business representatives next week will give Chinese President Xi Jinping a big opportunity to champion his Belt and Road Initiative, even as it faces pushback and criticism.”

Beijing reacts to foreign criticisms a bit faster than domestic ones. Its direct investments to Africa have slowed slightly in recent years, from a peak of US$3.4 billion in 2013 to US$3.1 billion last year, according to data from the Chinese Ministry of Commerce.

At a daily press briefing last Friday, foreign ministry spokeswoman Hua Chunying denied that Beijing was saddling its partners with onerous debt, saying that its loans to Sri Lanka and Pakistan were only a small part of those countries’ overall foreign debt.

“It’s unreasonable that money coming out of Western countries is praised as good and sweet, while coming out of China it’s sinister and a trap,” she said. “It’s not a free lunch, it’s something where everybody chips in.”

Beijing is not going to slow down. “China is slated to pledge billions of dollars more in aid and loans to African nations at a key conference in Beijing on Monday, even as rising debt risks and lower-than-expected returns have slowed Chinese investment in the continent. “ The same SCMP report said.

Chinese overseas investment is a new form of imperialism

Some western analysts claims that President Xi’s ambitions with the Belt and Road initiative constituted a “new form of imperialism,” consisting primarily of extracting resources and selling finished products back to Africans.

“Actually, Kenyatta should criticize China because it has destroyed African markets with subsidized exports, especially with the cheap exports by state companies, with cheap consumer goods — from bicycles to flashlights, from the candle to the fridge,” said Robert Kappel, a development economist at the University of Leipzig in Germany.

Many observers have warned of the real risk of Chinese lending undermining African sovereignty and U.S. interests in the region.

Former U.S. Secretary of State Rex Tillerson acknowledged that “Chinese investment does have the potential to address Africa’s infrastructure gap” but at the same time lamented that “its approach has led to mounting debt and few, if any, jobs in most countries” even as it “encourages dependency using opaque contracts, predatory loan practices, and corrupt deals that mire nations in debt and undercut their sovereignty, denying them their long-term, self-sustaining growth.”

Take, for example, the tiny East African country of Djibouti, home to the largest U.S. military base in Africa since 2002. It has now become China’s military base.

“A richer and more globally connected China has not become a more democratic one — instead, Beijing’s economic strength now allows it to spread its own illiberal values to other countries, “ said Richard Fontaine, president of the Center for a New American Security.

Another example is the Hambantota port in Sri Lanka. After Sri Lanka failed to repay its debt, it has formally handed over its southern port of Hambantota to China on a 99-year lease, which government critics have denounced as an erosion of the country’s sovereignty.

President Xi’s billion-dollar investment is challenged with more criticism at home

Critics challenge that Chinese leader Xi Jingping only likes to show off with his billion-dollar investment in African infrastructure, while ignoring the poor in his own country, “Does he get the approval of 1.4 billion Chinese in doing so?”

As of 2018 the number of people in poverty living below the national poverty line is around 30 million, according to official data.

On July 20, Sun Wenguang, a retired professor of physics at Shandong University, penned an open letter criticizing Xi for “offering almost CNY 400 billion in aid to 166 countries, and sending 600,000 aid workers”.

“Listen to what I say, is it wrong? Regular people are poor, let’s not throw our money away in Africa … throwing money around like this doesn’t do any good for our country or our society.” He expressed his concerns in a VOA interview under threat of the police.

“In the BRI, domestic critics see an extension of the CCP’s predilection for grand spending that disproportionately benefits connected insiders. As they see it, these loss-making “face projects” are conducted with limited transparency and oversight, and are primarily meant to reflect glory upon one’s superiors (and help underlings curry favor). The braver of Xi’s critics have thus taken to describing his foreign policy as dasabi, or throwing money around. The phrase, which censors have largely erased from China’s internet, is also a homonym for an extremely vulgar term used to insult someone’s intelligence,” according to OCNUS.

Even overseas Chinese have been fed up with the arrogance of corrupt CCP officials and how they have poisoned the overseas communities with propaganda of extreme ideology.

Just last Thursday India and its neighboring countries boycotted the inauguration of China-funded bridge in Maldives, allegedly denouncing that only the Chinese ambassador’s car was allowed to drive up to the venue. “Ambassadors of Sri Lanka and Bangladesh boycotted the bridge inauguration event as their cars were stopped by Yameen’s security and they were asked to walk. Only Chinese ambassador’s car was allowed to pass up to the venue. Such an insult to traditional friends!” tweeted MP and joint opposition spokesperson Ahmed Mahloof.

Although Yameen went on to describe the $200 million bridge as “the biggest achievement in our diplomatic history”, this arrogance of Chinese diplomacy does not represent the cultural tradition of the Chinese people.

Followcn Staff Writer

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