Changing Realities: China-Africa Infrastructure Development

Abstract

Changing Realities:China-Africa Infrastructure Development Mandira Bagwandeen (bio) Through an extensive portfolio of infrastructure investments, China has played a crucial role in helping Africa reduce deficits in its infrastructure. Over the past decade and a half, Chinese state-owned or state-aligned construction and engineering companies have strategically entered African markets with assistance from the Chinese government. Under China's Belt and Road Initiative (BRI), Chinese companies took on mega-infrastructure projects, especially in the energy and transport sectors, that could aid African countries with achieving higher levels of development. However, these mega-BRI projects came with hefty price tags that have contributed to compounding the debt stress of several African nations. In this regard, many international (and especially Western) actors have accused China of predatory lending practices and debt-trap diplomacy. This narrative has been further amplified amid the Covid-19 pandemic, which has had significant ramifications for BRI projects in Africa and around the world. The pandemic has created some doubt about whether Chinese-funded and–built infrastructure projects can be completed and, more importantly, whether African states have the fiscal capacity to repay these development loans. With reduced revenues available to African governments, the risk of defaulting on loan repayments is high. Moreover, because of the burden of loan repayments, African states are handicapped in their response measures to Covid-19 and its economic consequences. The Eighth Forum on China-Africa Cooperation (FOCAC) in November 2021 demonstrated that due to changing realities—including China's domestic economic concerns, U.S.-China trade tensions, the global economic impact of Covid-19, and Africa's pandemic-induced debt stress—Beijing seems to have realized that it cannot continue to be Africa's go-to bank for financing infrastructure development. This essay outlines that China may not be as willing as it was in past years to finance infrastructure development projects in Africa. It explores the impact of Covid-19 on the development of BRI infrastructure projects in Africa and briefly assesses the validity of the debt-trap and predatory lending accusations leveled against China. Additionally, the essay addresses [End Page 18] the Eighth FOCAC summit, which indicated that China is likely to reduce its focus on development financing for hard infrastructure in its cooperation with African countries. China's Belt and Road Infrastructure in Africa and Covid-19 As of 2019, China was the single-largest source of finance for African infrastructure, having "finance[d] one in five projects and construct[ed] one in three."1 Although the continent's enormous infrastructural investment gap cannot solely be met by Chinese financing, Beijing's role in contributing to the development of the region's infrastructure has been crucial. The China-Africa infrastructure partnership was strengthened under the impetus of BRI, which was introduced in 2013. The initiative closely centers on the Chinese proverb that "if you want to get rich, build a road first" and the argument that "infrastructure investments presuppose economic growth and enhance quality of life."2 This logic is particularly appealing to African states that are desperate to reduce their deficits in infrastructure. Several African scholars have opined that BRI could play a critical role in Africa's industrialization and infrastructure development through the building of synergies between Agenda 2063, the pan-African development plan of the African Union (AU), and BRI.3 Even individual African leaders and the AU welcomed China's infrastructural drive on the continent motivated by BRI. In January 2015, China and the AU signed a memorandum of understanding to cooperate on developing major transport infrastructure networks (high-speed railways, aviation, and highways) and industrialization infrastructure. With the ambition to connect all 54 African states through transport infrastructure projects, this memorandum complements and aligns with Agenda 2063, which in turn aims to accelerate continental integration through the development of transport infrastructure and industrialization. Massive national and regional projects worth billions of dollars, mostly in the transport and [End Page 19] energy sectors, began to pop up across the continent. As of April 2019, China had BRI projects in 42 different African countries,4 and by January 2021 a total of 46 out of 54 African countries had signed on to become official...