China’s economic presence in East Africa getting questioned

China’s deep influence in 13 countries of East Africa, through its economic presence in the region, is getting questioned for debt traps and duplicity it fosters, top sources said.

Africa is one of the fastest urbanising continents with pace of migration to urban centres faster than India and China. By 2034, it will have the world’s largest working age population. Besides, the continent has at least 46 per cent of the world’s supply of manganese, while 50 per cent of the world’s cobalt reserves are estimated to be in the Democratic Republic of Congo alone.

Africa’s Coltan (columbite-tantalites) resources are also of significant interest to the world, as the mineral is integral in electronics, including cell phones.

The continent’s fastest growing sub-region is East Africa, whose countries including several emerging economies such as Ethiopia, Djibouti, Tanzania, and Kenya.

China has had long-standing relations with Africa, having slowly and steadily built up its strategic and economic presence over the years. Unfettered by public opinion back home, it has always managed to establish relationships with governments which were actively ostracised by the West.

“The absence of other major powers in the region, coupled with the internecine conflicts and political instability, has made East Africa a particularly favoured region for China to deepen its influence and establish a stronghold,” said a senior government official.

Over the last two decades, China has established a significant economic presence, and its lucrative economic investment packages, flexible political approach, and focused big-ticket development projects under Belt and Road Initiative to ostensibly provide a massive opportunity to African countries.

“However, it is an open secret that many Belt and Road Initiative projects in Africa have been made through underhand dealings with unscrupulous elements who may have placed their personal profit above public interest,” the official claimed.

Reportedly, “almost all projects in Africa have been concluded with opaque and dubious terms”. “The projects are, in all certainty, unable to pass even a basic level of financial scrutiny,” the official claimed.

As public calls for accountability become intense, governments answerable to their citizens are pulling back from China and calling out the unfavourable terms that were thrust upon them in a “take it or leave it” kind of deal.

“A Hobson’s choice to be precise,” the officer said.

The spectre of a debt trap looms real for many African nations as the sheen of Chinese President Xi Jinping’s promises wears off and the duplicity of Chinese intent becomes clear.

According to Chinese Communist Party’s agenda, sub-Saharan African ports play an integral role in the BRI and Chinese investments in East African ports form the backbone of the ‘Maritime Silk Road’.

These investments not only help China gain access to more markets, but also helps Beijing to exert more political leverage, empower People’s Liberation Army Navy’s activism, and also establish a dependency on Chinese technology and expertise.

The saga of Tanzania’s Bagamayo port is one that has left an indelible impression in the region.

“A $10 bn investment in the port has been repeatedly stalled as the China Merchant Holdings company insisted on a 99-year lease,” the official claimed. New Tanzanian President Samia Suluhu Hassan has recently announced recommencement of negotiations for the development of the port.

This has ignited speculation that China, the project’s main investor, is looking to establish an additional dual-use foothold on the East African coast, a move that would greatly enhance Beijing’s strategic aims in the region.

With Bagamoyo under control of China, the Mozambique Channel, which is an important shipping route, would be easily controlled in war-like situations or low-intensity conflicts.

The port could be tapped for purposes that go beyond purely commercial endeavours and may also be used as a ship repair hub for the Chinese Navy or perhaps even more.

Djibouti, another small country in east Africa, owes more than 70 per cent of its external debt to China. Its location at the Horn of Africa makes the country one of the critical locales for projecting power across Africa and Asia.

The former French colony was once crucial to France’s influence in East Africa.

China and Chinese state-owned firms have invested nearly $10 billion in Djibouti’s Doraleh Container Terminal and control a majority of the port.

All these have allowed for significant leverage leading to the first overseas Chinese military base being set up in Djibouti in 2017.

Another country facing a debt crisis with China is Kenya. It has already defaulted on its payment for Mombasa port and is on the verge of losing it to the debt trap created by Chinese firms.

With the operationalisation of the Lamu port in Kenya, China now has another port facility in the Indian Ocean that it could access without impediments and from where it could project its power capabilities.

Just like Hambantota in Sri Lanka, Djibouti, Bagamoyo, Mombasa, and Lamu can be seen as examples of China’s “debt-trap diplomacy”, wherein China is tailoring its support to the country by answering immediately their expressed needs, but by doing that, also trapping them in its net, as they would be unable to pay back the loans.

“To put the unequal terms of BRI projects in perspective for the readers, the project contracts invariably have conditions that countries are forced to accept – loans at exorbitant rates, expansive concessions for Chinese agencies to operate and expand at will, long term exclusive unilateral lease and a non-competition clause,” the official added.

The political imperative of showcasing China-Africa relations has also seen many economically unviable projects being taken up under the BRI umbrella.

A prime example for the same is the railway project in Ethiopia, which required significant renegotiation of the loan terms.

Allegedly, China’s financing of its BRI projects across Africa is mostly comprised of loans to governments that are both very large and conditioned by signatory’s commitments to not fully disclose their terms.

The latest victim being Zambia, which is struggling to repay its debt to China.

“What China is intending to do in Africa is no less than what the Europeans and Americans did in the past. Taking advantage of the weak economy and unstable governments, China has been able to lure these poverty ridden countries into an inescapable trap,” the official said.

The Chinese model in Africa has been distinctly predatory and self-serving – a realisation that is dawning on many African nations today, the official claimed.

China watchers and BRI commentators have for long asserted that the BRI is only a system of creating access to markets for Chinese goods and the narrative of creation of infrastructure that will boost development of the host nation is, at best, tenuous.

The African agenda of the BRI also has to be seen in a larger context. The Chinese Dream that has been popularised by Xi Jinping hinges on global influence and power, and “this is being obtained blatantly through coercion, belligerence, opacity and duplicity by the Chinese machinery,” the official added.

“The economic subjugation of African nations, hegemony and outlandish claims in the South China Sea, interference with legitimate maritime economic pursuits of littoral nations, lack of respect for international norms, belligerence on hitherto peaceful border areas — all point to the treacherous intentions and underpinnings of the Chinese Dream.”

“It is, therefore, time that the world calls out the CPC for what they are – a ruthless unscrupulous conglomerate that treats sovereign nations with disdain and disrespect,” the official added.

China views peace, prosperity, and regional influence as a zero-sum game, and this has played out again and again on the world stage.

“It is a certainty that a country that shows scant regard for its citizens is unlikely to treat any other nation with equanimity and respect,” he said.

And this is becoming clearer every day, with the experience of the African nations.

(Sumit Kumar Singh can be contacted at sumit.k@ians.in)

–IANS

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