A Critique of Chinese Loans in Sub-Saharan Africa: A fruitful Prospect or Neo-Colonisation

Abstract

Abstract Economic development has been on Sub Sahara Africa’s (SSA) agenda for the past two decades. However, the stark reality is that it has been sporadic, slack and slow. One can argue that these nations had a late start due to their economies being controlled by conquerors until the late 20th century. Others might reinforce the idea that the late blooming of SSA was due to their economic development being stifled by the punitive interests levied by the IMF under the guise of reconstruction loans following decolonisation. Thus, in a bid to egress of that vicious circle of debt, another beacon has lit for SSA in the form of Chinese loans. Albeit, an acceptable macro reality that growth can be achieved through loans, this stance has raised moot questions: Is this financial help a strategy that will make SSA beholden to the Chinese government akin to a re-colonisation, or will it propel SSA nations into developed nations by alleviating poverty, creating jobs and promoting growth? The critical lesson of this paper is that confiscation of resources, in the event of non-payment of loans, should be solved with other measures of debt repayment to ensure the continent is not exposed to neo-colonisation.