China has chosen a different path to the West in providing development assistance to Africa, but that does not necessarily make it nefarious, writes Solomon Winyi.

China provides more than 120 developing countries with official developmental assistance. Its influence is further extended by programmes with fast delivery mechanisms, which cost less than the other donors. Its disregard for adding political conditions has also made it an attractive partner to many states.

China started its aid program in the 1950s. Egypt was its first African recipient in 1956 and since then every country in Africa, except Swaziland, has been a recipient of Chinese aid.

China’s official development assistance to Africa has significantly increased since the formation of the Forum on China-Africa Cooperation (FOCAC) in 2000. At the recent summit in Beijing in September 2024, China’s president Xi Jinping, pledged to deliver £39 billion in loans, investment and aid to the continent over the next three years.

What does Chinese ODA mean?

The Chinese foreign aid appears to be different from “official development assistance” as defined by the Organisation for Economic Co-operation and Development (OECD) and Development Assistance Committee (DAC). According to the OECD and DAC, government aid promotes and specifically targets the economic development and welfare of receiving countries. China doesn’t distinguish between official development assistance (ODA) and more commercially oriented types of state financing. ODA explicitly excludes military aid and transactions with primarily commercial objectives highly associated with China in Africa.

Debates around Chinese aid are based on the perception of it being an emerging donor that is less altruistic and operates with no conditionalities when giving aid to corrupt and undemocratic regimes that are well endowed with natural resources. China has no obligation to comply with DAC reporting norms since it is a non-member. However, this breaking of established international norms regarding aid has drawn scrutiny and suspicion regarding its true intentions in Africa.

China’s foreign policy interests visibly guide ODA flows more than concessional forms of state financing in most African countries, and the same applies to the allocation of grants compared to loans. Critics in academia, media and policymaking argue that China’s aid undermines Western donors’ efforts to promote the spread of democracy and the rule of law in Africa.

Is China an ally of Africa?

China has become the foremost bilateral creditor to Africa, offering African nations an alternative source of financing for infrastructure, mining, and energy projects. China’s proportion of the total external governmental debt in sub-Saharan Africa was under 2 per cent before 2005. It had increased to around 17 per cent by 2021, equating to £106 billion. In the past two decades, China has emerged as Africa’s biggest bilateral commercial partner.

Approximately 20 per cent of the region’s exports are sent to China, while around 16 per cent of Africa’s imports originate from China. The entire commerce volume in 2023 reached a record £222.6 billion. Chinese foreign direct investment (FDI) has markedly increased during the past two decades. In 2003, the yearly foreign direct investment flow from China to Africa was roughly £59 million. It reached a zenith of £3.96 billion in 2022, constituting around 4.4 per cent of the region’s total foreign direct investment.

In 2020 and 2021, China and Africa enhanced their economic collaboration through several strategic plans and activities under the Belt and Road Initiative and the Forum on China-Africa Cooperation, a partnership platform created in 2000. These initiatives correspond with the African Union’s Agenda 2063, a strategic framework for the continent’s socio-economic transformation over the next fifty years.

The numbers clearly show that Africa needs China as an ally now and in the future, given the evolving ODA environment. Soon, ODA  will be about give and take, or reciprocity, as already exhibited by African countries that align with China’s voting at the UN General Assembly do tend to receive more development assistance from Beijing. However, China has been consistent and portrays cooperation with Africa as based on ‘friendship’ and ‘mutual benefit’ and express gratitude for mutual African support in the United Nations. The rhetoric is pervasive as the China and Africa White Paper of 2021 mentions ‘friendship’ 34 times and the term ‘mutual’ 28 times.

China has continued to help with infrastructure projects that conventional donors have been reluctant to finance, owing to heightened concerns regarding operational and maintenance costs when numerous African nations faced economic stagnation and decline. Africa has recently experienced a decline in financing for new infrastructure as donors favour restoration and maintenance. At the same time, institutional development has been preferred to infrastructure construction as the primary focus for many donors. However, China has found avenues such as market philosophy to seize the opportunity by increasingly depending on private commercial investments.

More importantly, Chinese ideals of non-interference with Western practices of democracy and human rights are widespread in Africa and often yield the desired results. Over time, western donors have sparked debate between aid and values in Africa. The Chinese have addressed the fears of withholding, reducing, and ending aid. African countries now have an alternative to the new norm of donors, who often support the government’s leading critics. Most importantly, African governments believe that while opinions are based on fundamental values, they sometimes need to be matched with a sufficiently deep understanding of local contexts, history, culture, and social and institutional context.

Debt Trap diplomacy?

In the coming years, China is likely to push some countries into default and thereby gain leverage over tenders, infrastructure construction and resources.

The Chinese enterprises have tactically funded and constructed, expanded, or refurbished a minimum of 24 presidential or prime ministerial residences or offices; at least 26 parliamentary buildings or offices; no fewer than 32 military or police facilities; at least 19 foreign affairs ministry offices; and a minimum of 14 critical intra-governmental telecommunications networks. This creates a sense of indebtedness from Africa giving China an edge over other countries when it comes to government contracts.

Over four hundred Chinese investment initiatives, with a total valuation exceeding £3 billion, are active in Ethiopia. Chinese enterprises are allegedly constructed around 70 per cent of the roadways in Ethiopia, including the prominent Addis Ababa–Djibouti Railway. The International Monetary Fund  has predicted that Ethiopia faces a significant risk of foreign financial crisis, with its government debt ratio over 60 per cent of its gross domestic product.

Recent studies have also uncovered high levels of “hidden” debt and defaults, with Chinese lenders’ restructuring providing little relief. Countries appear strategically selected by China given their influence. For instance, Kenya has been enamoured with Chinese incentives and borrowed £4.9 million from Chinese lenders, making it one of the largest creditors. In February 2021, China postponed the debt repayment holiday despite the Kenyan economy still reeling from the Covid-19 pandemic. 

The debates of debt trap diplomacy will linger given that many countries used strategic assets, such as the port of Mombasa, as collateral.

That said, China has been far more generous than other lenders when it comes to providing relief to allow African countries to manage their post-Covid recovery. The debt trap diplomacy, for now, remains a myth used to discredit China’s growing influence in Africa.

Photo credit: GovernmentZA used with permission CC BY-ND 2.0