China is exerting a new form of colonialism on the African continent and it is being largely unopposed. The Chinese Belt and Road Initiative (BRI) is a centre-piece policy of the Communist Party of China that claims to be "a bid to enhance regional connectivity and embrace a brighter future" (Gov.cn, 2015). It is a global level infrastructural project that aims to increase China’s trading links and commodity sources. 42 African countries have signed onto an agreement or understanding with the BRI which has invested in increasing the number and quality of roads, ports and bridges, as well as increasing access to electricity and agricultural irrigation. All in an effort to try and increase connectivity within Africa and enhance trade routes to Asia specifically.
That said, many non-participant countries, mainly Western economies, interpret the plan as an attempt by China to establish global dominance over resources in emerging economies. This so called, ‘debt-trap diplomacy’ has often been cited as a potential form of neo-colonialism in Africa through the acquisition of strategic assets (e.g. ports) on the continent.
On the face of it, the borrowing from China to fund infrastructural projects and contribute to development may seem positive. But the frightening reality may be one of China trying to increase global dominance by reducing the autonomy of resource-rich African economies. China has rapidly become the largest bilateral lender to Africa, transferring nearly $150bn to governments and state-owned companies as it seeks to secure commodity supplies to fuel its seemingly perpetual economic expansion.
An estimated four-fifths of Chinese loans in the continent have been used for infrastructural projects, for example the hydroelectric power Merowe Dam in Sudan. These are very beneficial for increasing the potential output of the sub-Saharan emerging economies - currently it is easier to transfer goods by ships around Africa than to go through it.
But often, these infrastructural projects have complete disregard for the ecological impacts on the uniquely fragile ecosystems in the continent. Furthermore, many of them are left incomplete or are not of a very high standard.
Almost all African countries have borrowed from Chinese lenders, and eight have borrowed more than $5bn. Exacerbating the problem is Beijing’s reluctance to participate in a Debt Service Suspension Initiative (DSSI), which is a moratorium on repayments on bilateral loans from the world’s 73 poorest economies to the G20 (a collection of twenty of the World’s largest economies). This has continued to allow major outflows of capital from already struggling African economies as the impacts of the current global Covid-19 recession hit. According to Deborah Brautigam, an American political scientist, Chinese loans in Africa of such large quantities have been misused by many borrowers and have even promoted more corruption in the continent.
As well as this, links to organised crime through the completed travel links have been found. The International Criminal Police Organisation (interpol), states that whilst, globally, 90% of goods traded are transported via shipping containers only 2% of containers are being physically checked at the destination. This has made illegal trade links between Africa and Asia in goods such as coloured gemstones and ivory easy to establish. The construction of more ports on Africa’s East coast via the BRI only adds to the problem - China is the main export destination of ivory. For example, in 2016 the Chinese BRI built Kenyan Port of Mombasa was part of a supply chain included in an illegal 2.3 tonne ivory trade.
In my opinion, the overall effect of the loans is questionable, the potential for Africa to find itself in a sovereign debt crisis is high if other developed economies and international regulatory bodies do not intervene. However, there is no doubt that the inward investment was needed to boost the development of sub-Saharan Africa. The long run effects of the debt are yet to be known; a debt spiral would leave these economies with little manoeuvrability to solve their own problems without external input. The extent to which the corruption has affected government incentives is also yet to be seen. Ostensibly, inward investment to Africa may only be seen as a good thing, however other factors at play may only leave the continent in a more unstable state than it began.
Quote taken from:
"China unveils action plan on Belt and Road Initiative". Gov.cn. Xinhua. 28 March 2015.