African leaders likely to table funding dilemma as they gather in China

Delegates from numerous African states have arrived in China for the China-Africa summit intended to tackle mutual concerns for both parties. Since Tuesday, honor guards and dancing troupes have welcomed African leaders, as the president of China, Xi Jinping, has already met with some of his guests.

This forum comes at a time when China’s involvement in African economic affairs is at an all time low.

For decades, Chinese funds have been instrumental in the infrastructural development of several African countries.

With initiatives like the Belt and Road initiative, said African states have benefited greatly from China, which has in-turn increased the East Asian country’s influence across the continent.

However, Chinese funds have presented a two edged problem in recent years, one of which is the decline of Chinese financing on the continent, which could be a subject of discourse during the 3-day summit.

Chinese loans to African governments or state-linked borrowers plummeted throughout the pandemic, dropping to under $1 billion in 2022, according to Boston University’s Global Development Policy Center. The statistics projected a slight rebound to $4.6 billion in 2023, far below the peak of more than $28.8 billion in 2016.

On the other hand, there is the concern of Africa’s outstanding dues which is partly a result of the unsustainable debt some countries on the continent continue to incur from China.

Another topic likely to be addressed is the future of China’s purchase of African products.

While experts believe that Chinese loans only account for a small quota of Africa’s external debt, there is no denying that the influx of loans from the East Asian country has added to Africa’s debt burden, as China is often rigid with its repayment policies.

As seen in a CNN report, Beijing has defended its lending methods and attempts to ease debt payments, but debt relief is unlikely to be a key issue at the international meeting, which will instead focus on trade measures and boosting what China describes as “small yet beautiful” projects.

“There will be fewer projects but a greater spotlight on them. In an ironic way, I think this will lead to a more sustainable path,” said Bhaso Ndzendze, an associate professor of politics and international relations at the University of Johannesburg in South Africa.

But “the African side is keen to accept almost anything that China has to offer,” he added, alluding to the few options Africa has.