China’s investment in Africa: Everything you need to know – BBC Africa


As China’s influence grows in Africa, so
does the controversy. Depending on whom you ask, you’ll either get excitement about
all the new infrastructure, or accusations of ‘neo-colonialism’.
I’m Larry Madowo – and I’m Vincent Ni.
We’re going to tell you how this relationship became so significant…
… and what China’s economic slowdown might mean for the future of African nations. Let’s start with the basics. Which countries in Africa have an economic relationship with
China? Well, it would be easier to say which country doesn’t trade with China, and that
is eSwatini. Yes, China isn’t keen on doing business
with countries that recognise Taiwan as a nation state, but that’s a topic for another
video. And we should totally do that, Vincent! Can you explain why exactly China
has started investing so heavily in Africa? Why now? Well, it’s not coming out of the blue. China has been building up its investment in Africa for about two decades now. For China, Africa is more than just a massive market
for its goods. It’s home to vast natural resources, which China wants to invest in.
The Communist Party also has a strategic policy to gain ‘soft power’, which is right at
the heart of the Party’s leadership. OK, so it should come as no surprise to any
of us that China has become the continent’s greatest trading partner. It actually surpassed
the United States 10 years ago, in 2009. China’s main exports are machinery, electronics and
textiles, but like you said – it’s not just a one-way relationship. China imports crude
oil, iron ore, cotton and other natural resources from African countries. This has never happened
on such a huge scale. What’s making China’s presence felt even more is the fact that the
US has decreased its involvement in the continent, even more after Donald Trump’s administration came to power. So where’s most of the trade happening?
South Africa, Ethiopia, Angola and Nigeria are China’s biggest trading partners on
the continent. There are also countries like Côte d’Ivoire, at the very beginning of
developing a relationship and partnership with China. Overall China-Africa trade volumes amounted
to 170 billion U.S. dollars in 2017, which is a huge increase from just over 10 billion
dollars in 2000. Yes, and the Chinese government estimates
that this will grow even faster, to over 300 billion dollars next year. Of course more investment usually means more debt, at least in the short term. Let me give you an idea of scale of the money owed: in 2017, Zambia’s total debt amounted to 8.7 billion dollars, almost three quarters of which is owed just to China. For Djibouti, 77% of its debt is to Chinese lenders. So why are African countries so keen to do business with China rather than other lenders?
Well, it’s often said that China’s loans are cheaper and come with ‘fewer strings
attached’. What that actually means is that, unlike the USA or the World Bank, China doesn’t
really mind if you have human rights issues, other outstanding debts, or aren’t transparent enough when it’s lending you money. That being said, this doesn’t make the loans
any easier to repay. In 2015, a prominent research group identified 17 African countries
that would be potentially unable to repay their loans, and that Djibouti, Republic of
Congo and Zambia are most at risk. Some countries Some countries are relying on gradually repaying their debts to China by shipping specific quantities of oil. But if the price of oil drops drastically
again, that might make it all the more difficult for the debt to be paid back. What does this mean? Well, the contracts for the projects aren’t public so we don’t
know – but it is feared that some public resources might be used as collateral. Meanwhile, cracks are starting to appear in China’s economy, with signs of weakening growth and trade tensions – especially with the United States. In fact, China’s stock market was the world’s worst performer last year, ending with a loss of 28% – so that is just adding to the worries. China hasn’t talked about what it means but it is assumed that if there’s less
to spend, they may give fewer loans, and fewer extensions of projects such as railways. In other words, China is likely to start tightening the purse strings. What does the rest of the world think of China’s involvement in Africa? UK and other countries criticise
China’s ‘predatory’ work in Africa, calling it ‘debt trap diplomacy’. But
analysts like Joseph Stiglitz say this line of thinking is just ‘sour grapes’ – China
is making tangible changes for people who live in these countries, bringing affordable
goods into the market at a fraction of the costs. Policy makers and governments may be critical of the money being poured into Africa, but
the average African isn’t.

Paul Whisler

34 Comments

  1. So people are hating Chinese. Because only white countries are reliable to invest. Hahah. What a joke

  2. Brought to you by the Ministry of Communications, from China (under the disguise of BBC).
    We as China, we recommend China.
    We as African political leaders, we recommend stuffing our own pockets for the bennefit of our close family.
    And I see great opportunities for China and the African political leaders.

  3. BBC Africa doesn’t know African geography; you put Eritrea as part of Ethiopia! …..very shocking coming from BBC!

  4. Hello I noticed that many videos of your youtube channel do not come with subtitles. As a french viewer currently trying to improve my english, I find it a bit difficult to understand every part of the video without help from time to time. I'd appreciate a lot you considering to add english subtitles or enable viewers to contribute…
    Thanks for reading!

  5. C'mon American and European brought death, slavery, civil war in africa in exchange basic western education, some infrastructure

  6. Step1: Let China build networks to help African people online.
    Step2: Brainwash them with BBC CNN…then they will hate China.

  7. Larry, this is PR to the highest degree. Independent journalism looks at how much in imports vs.exports Africa is doing with china, the labor constraint , human rights broken because of loans, etc, please stop doing a Chinese paid PR clip. Everyone in Africa can see how Chinese are affecting local business and here as you call it in quotes, neo-colonialism doesn't exist. Please visit China as a Muslim and when you get locked up in a concentration camp aka "reeducation camp" then you will tel us how this PR clip can convince us. If China treats it's own citizens like that, do not think this"development " they claim to bring will help. P.s please also credit Chinese government for paying for this clip. Tumechoka

    #Stick to true journalism and speak the truth…not a version of the truth…the truth. That is why we respected you at NTV and now at BBC Africa

  8. While USSR was strong, the Africans followed our ideas and help. Since we lost Soviet Union the African people are invaded by the new exploiters and capitalists. Communism can't lose like The Bible, in the we shall win. The whole African needs one leader like Stalin was

  9. china do not need money back,they also know Aftica couldn't pay it back,now US China economical war no one interested to business with china,but can be interested in Africa,and africa also has a low labour cost..!so Chinese investing all over the Africa,to have a good future of their business,Chinese plan they will bring all international investor to africa to make a good profit and in this process China will not affected china politically in future,if anything happened world will reject china,but the world wouldn't reject Africa..!so they came out from the home to make a safe business place in africa,and china will give the low price too..because producing cost wil be low,just wait for time to see..china will be benefited from many they will use african low cost worker+they will use african land and when Africa couldn't back money to china,china will take exra facilities from africa,they will take what they want

  10. The Chinese are the most racist arrogant and two faced of all the Asian ethnic groups Africans will get stabbed in the back big time mark my words. If African nations want build their country up they should do it them selves don’t trust the Chinese they pretend to be your friends but will end up being your worst enemies.

  11. Investment my ass. You africans are so dumb your new colonizer is China. Shit chinese are getting away with in Africa is because you africans are so fucking dumb. I dare any of you to go to china and see how shitty they treat you. So shut the fuck up about china investments in africa when it's colonizing in disguise!

    China is a giant shit hole full of pollution they cant even breath their own air so now they are going to pollute the cleanest air in the world which is in africa. We don't need your industrial shit! Stay the fuck out of Africa. Since africa is poor why you can't leave the poor continent alone. Oh wait the tropical part of Africa are so rich in natural resources. So why not go to the deserts up North Africa and exploit it. Oh the arabs will bomb your ass to death!

  12. I think it's too late, government officials have already taken the money to get the projects underway so they can take the credit. Chinese companies now own the land and virtually hire no African workers.

  13. You Africans are in for a very rude awakening! You all better do something about your African leaders.

  14. When China do it is bad, but when western countries do it is ok, I hate this western hypocrisy

  15. These comments are so amusing. China has US$1.2 trillion invested in the US bond market ans has billions invested in property in Manhattan , let alone the rest of NYC. China's overall investment in Europe and the USA is staggering. but throw a few dollars to African countries and it's a clown show of people taking about colonization and exploitation. There are so many parties with vested interests in keeping African countries and people backward and a playground for wildlife its hard to keep track.

  16. Western media hypocracy, for hundreds years western enslave africa, bring civil war to Africa. China buy Africa natural resources, Africa get infrastructure, and jobs.

  17. The white men would love nothing better then for Africa to think China is going to do to Africa what the white men did to Asia and Africa the last 400 years. 🤪

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