Politics of Generosity: China as an Imperialist and the Impact of her Loans on Africa’s Democracy.

Not so long ago, the stage seemed set for Africa, a continent long stuck on the wrong side of the global economy finally the opportunity to become a center of economic might to provide prosperity to the continent’s growing population. Yet quietly a new danger loomed, the risk of falling under the control of China largely through Chinese economic investment and loans or in short Sino-imperialism.

 “We’ve had bad people before. The whites were bad, the Indians were worse, but the Chinese are worst of all.”

 Guy Scott, a former agricultural minister in the Zambian government.

On one side, African countries are desperate to fill up their infrastructural gaps to finally catch up with the world and on the other side a cunning China desperate for raw materials and energy to power their growing manufacturing capacity. The continent was placed right next to Shanghai in terms of Beijing’s business priorities. The mission was, to convert Africa into a “second continent” for China. Fast forward after many deals, conferences, delegations, and flights, trade between China and Africa have grown from $10 billion in 2000 to $190 billion by 2017. China has lent over $125 billion to Africa and has made plenty of unconditional loans available. But is the reality a win-win relationship as sold by China or is Africa tying itself to another era of foreign imperialism?

a McKinsey & Company report estimated that there are more than 10,000 Chinese-owned firms operating in Africa.
A 2017 McKinsey & Company report estimated that there are more than 10,000 Chinese-owned firms operating in Africa.

To determine whether China is an imperialist power, it is imperative to agree with the definition of imperialism. A reasonable, concise definition of imperialism is put forward by a political analyst, Stephen Gowans: “imperialism is a process of domination guided by economic interests.” The challenges to this imperialist narrative about China are premised on the origin of the term “imperialism” which is from a Latin word imperium, meaning authority or empire. And that there is no imperialism without an empire. Which is to say that imperialism no longer exists. That measure of imperialism is limited by reference to ancient historical events and isn’t dynamic to fit in the modern affairs of geopolitics. Like political systems, foreign policies, and strategies change, so does the approach to imperialism.

The unique traits of China’s foreign policy that make the country an imperialist will be highlighted in this article. China is a very prominent country in the world, particularly to developing countries because of the nature of the relationship between China and Africa. China has emerged as an alternative source of loans to the Third World countries breaking the monopoly of the Western funders. The nature of loans and aid offered by China and the Paris Club (a group of sovereign creditors including the US and 21 other states) are very distinct.

According to an article authored by Carlos Martinez titled Is Africa an Imperialist?, it is stated that International Credit Agencies offered loans and aid with Structural Adjustment Program (SAP); SAPs are loans from the IMF and World Bank, typically taken out in a crisis situation and disbursed on the condition that the recipient country implements a packet of ‘neoliberal’ reforms privatising key industries and resources, opening up markets to international competition, and liberalising prices, conditions on governance, rule of law and human rights. On the other hand, China’s aid is masked with the “non-interference”, “mutual respect” and “respect for territorial integrity” policies. At this point, the consensus is that the offer from China looks more appealing than the option from the West. However, it is under the mask that the true nature of these policies is unveiled as illustrated subsequently.

China has made available to African countries and their leaders billions of dollars in non-conditional aid.

According to the Johns Hopkins School of Advanced studies, it was stated that an estimated $143 billion of African debt to Chinese lenders has been racked up over two decades of record lending. Much of that has been large scale infrastructure projects from light railway systems in Ethiopia to airports in Zambia, ports in Tanzania, and roads in Uganda. Precisely how much African economies owe to China is unknown because of Beijing’s secretive terms and publications of the loans. World Bank says it is the largest of the total debt load valued at $583 billion.

Many of China’s investments are linked to the Belt and Road Initiative (BRI). The lack of transparency in China’s debt-driven projects obscures it’s risks to recipient countries that are already vulnerable to or suffering from the financial crisis. But concealing risks doesn’t eliminate their consequences and when the developing countries fail to repay the loans for the multi-billion dollar projects, it can result in loss of strategic assets, major hurdles to economic development, and loss of sovereignty. These are imperialist traits that are often referred to as “debt trap” diplomacy.

“There’s a belief that since Africa got a raw deal from the colonial West, then the Chinese must be Africa’s best friend. But the evidence doesn’t show that, and the main criticism is that they are building infrastructure in exchange for Africa’s resources in deals that are structured to favor China.”

George Ayittey, Ghanaian Economist.

For example, when Sri Lanka was unable to repay a loan for the Chinese built port in the city of Hambantota in 2018, the government granted China a 99-year lease for its use, potentially as a strategic base for China’s navy. In Djibouti, public debt has risen to approximately 100% of the country’s gross domestic product (GDP) and China owns a lion’s share. That places the country at a high risk of debt distress. That China’s first and only overseas military base is located in Djibouti is a consequence, not a coincidence. These instances only point at the annexation of territories which defeats the “non-interference” and “respect of territorial integrity” policies.

In the second such instance, and among the several other instances, in reference to an Article published by Sumantra in the Federalist, Kenya is under pressure to hand over it’s a busy and lucrative port of Mombasa to Chinese companies, as it fails to repay the debts owed to China. Mombasa, as any student of history, would remember Mombasa was one of the pivotal strategic ports for the Royal Navy in the 19th century to control Asia-Pacific as well as keep open sea routes for trade. Numerous African countries are on the verge of losing their strategic assets to China due to the various obscure terms in the loan agreements.

Mombasa Port, Kenya.
Mombasa Port, Kenya.

Several African finance ministers have revealed that loans from Chinese entities contain provisions that would force them to surrender state assets if they couldn’t repay. Two loans to Uganda; $325 million to upgrade the Entebbe airport and $1.4 billion for a power plant in Karuma- both contain that provision, although the government hasn’t yet declared itself unable to pay. Any pessimists would say it’s a matter of time. These predatory loan policies and terms orchestrated by the Chinese government are the epitomai of 21st-century imperialism.

Consequently, the Chinese influence in South Sudan also results from road construction and infrastructural development. South Sudan provides thirty thousand barrels of crude oil per day to Import and Export Bank (Exim) to fund infrastructural development. This includes the construction of the 392km road from Juba to Rumbek and from Juba to Nadapal on the Kenyan border, which is built by a Chinese firm using Chinese technology and manpower. It is on a well-founded background to assert that the China-Africa relationship gravely imbalanced and the intensified Chinese presence in Africa is a target to control Africa’s resources on a long term basis.

“Neither the borrower [Kenya] nor any of its assets are entitled to any right of immunity on the grounds of sovereignty, with respect to its obligations.”

The Daily Nation Newspaper, Kenya.

The recent resolution by the G20 nations, which include China, is that the member states shall suspend debt collection on government debt this year for more than 75 of the World’s poor countries. Officials in Zambia have however revealed that Beijing is demanding collateral exchange for debt deferral or forgiveness. The government of Zambia is negotiating to hand over copper mines including the country’s third largest mine, Mopani to China. This demand by China is a pure revelation of the country’s ulterior motives in Africa and other developing countries in the world. The ‘quid pro quo’ argument that has been advanced to justify this kind of relationship between China and Africa, where China offers the infrastructural development that Africa needs in return for natural resources is, in my opinion, myopic. Whether Africa direly needs infrastructural development to the extent of willing to offer her natural resources for a period of 99 years on a lease term in case of failure to pay, is a whole rich discussion for a fresh day. 

The government of Zambia is negotiating handing over copper mines including the country's third largest mine, Maponi to China.
The government of Zambia is negotiating to hand over copper mines including the country’s third largest mine, Mopani to China.

In the words of a professor at Nottingham University; “borrowing to construct infrastructure for which you don’t have immediate economic value and benefit is like borrowing money to buy a Tesla when you don’t have adequate access to electricity.”

Now that the pandemic induced economy is wiping out the government’s ability to repay the loan, the continent may witness China’s imperialist hidden agenda.

“it is not just reactionary monarchist powers that can be colonial. France was a republican great power and a colonizer, just as Nazi Germany, fascist Italy, and the Soviet Union were all colonial powers — even the United States had a fair share of colonial territories at one point in time in history. In that regard, China is acting no differently. But it is a colonial power, and there should be no qualms about that. The first shots of Chinese colonialism are evident as we head to the third decade of this century. One would be foolish not to take note of this historically significant development — and study its actual character.” by Sumantra Maitra a doctoral researcher at the University of Nottingham, UK.

Given the evidence that China’s lending imposes unsustainable burdens on vulnerable countries in Africa, contains provisions targeting Africa’s strategic assets, and doesn’t adhere to the international standards of transparency and financial stability, African leaders ought to mobilise themselves and break away from the second wave of African colonialism. Or in the least instance, set a pace for the world’s youngest population to liberate itself.

Impact of China’s debt on democracy in Africa  

China’s assistance is often considered attractive to recipient countries because it is free of conditionality on face value or is regarded as bearing “no” political strings and is disbursed much more quickly and efficiently than assistance from Western donors. This part of the article argues that the availability of China’s aid/loans to Africa has a negative impact on the development of democracy, respect for human rights, and rule of law in Africa as will be illustrated.

Conditions characterise donations from the west to governance, liberties, the rule of law, and other structural Adjustment Programmes (SAPs) which isn’t the case with Chinese aid. China doesn’t precondition her loan recipients to legislate pro LGBTQ laws or the respect rule of law and other democratic principles. The emergence of China as an alternative for aid was gladly welcomed by various African states and thus abandoning the ‘stringent’ democratic conditions imposed by Western donors. This is not meant to infer that the development of democracy in Africa is solely based on conditioned aid, but it acknowledges the role such aid has had in the development of democracy on the continent.

China’s politics is dominated by the ruling party, the Chinese Communist Party (CCP) which has an international reputation for a suppressive approach to civil rights and most recently for the approach to the Hong Kong protests. This CCP has a program of annually hosting African party leaders including South Africa’s ANC, Angola’s MPLA, Tanzanian’s Chama Cha Mapinduzi, Ethiopian People’s Revolutionary Democratic Front, and many other political parties to a political party training in Beijing. Because of its massive investment in Africa, China has also become a big political player in the region that is consulted on governance issues.

China Communist Party is unpopular for its oppressive approach to human rights.
China’s Communist Party is unpopular for its oppressive approach to human rights.

Studies show that China strengthened engagement in Angola in 2004 when the EU and the US sought to pressure the Angolan government to hold elections and increase the transparency of the oil revenues. In the same year, China negotiated a $2 billion loan to Angola through the Export-Import Bank (Exim Bank). The size of the loan outweighed the offer from Western donors. The loan had a great effect because it opened the country to international commercial loans again without pressure to improve democratic governance and transparency. 

It was at that point that Angola escaped early democratic progress. By 2012, China had extended over $14 billion to Angola and had overtaken the US and EU as credit donors in the country. The timing of the Chinese loan to counter the offer of EU and US shifted the focus of the government from the democratic development to a “non-interference” policy-based loan.

The same scenario was evidenced in Ethiopia. Ethiopia, according to a paper by Christine H on EU and US democracy facing China in Africa, had agreed with Western donors to establish aid policy dialogues that would lead to political reforms ahead of the 2005 elections. However, during the 2005 election period, the relations between Ethiopia and the EU and the US altered fundamentally. The Ethiopian People’s Revolutionary Democratic Front (EPRDF) had won the election but shortly after the elections, protests broke out and were brutally repressed. At least 200 people were reportedly dead. In response to the crisis, the Western donors pressured the government to reconcile with the opposition and release political prisoners. In December, the EU, US and other budget donors withheld direct budget aid on the condition of political reforms.

Similar to Angola, China timely extended a sizable loan of $500 million to Ethiopia at the time when the EU and the US were pressing forward political reforms in the country. The volume of the loan equaled the amount that Ethiopia would have lost if the EU and US had cut their budget aid. The timely unconditional loans from China entrench dictatorship and offer autocratic stability to such governments and the consequences include postponement of political reforms, suppressive approach to freedom of expression, and political association.

As part of the multi-trillion-dollar Belt and Road Initiative, the Chinese companies have been instrumental in providing Artificial intelligence systems to African governments. According to a 2019 article by Samuel Woodham published by The Diplomat titled: How China exports Repression to Africa, 18 countries have been supplied with technological assistance to help identify threats to “public order.” 

China has been labeled the worst abuser of internet freedom in the world for four consecutive years by international watchdog Freedom House. There are fears that arming autocratic governments with such technologies would have a huge impact on African democracy and the exercise of rights.

Manipulation of data through Chinese Imperialist technology is a big threat to Africa’s democracy.

Conclusively, the Chinese development model which has thrived with minimal adherence to democracy is very attractive to African leaders with a firm grip on power. The misconception is that borrowing the same approach would work for their respective states. Several African leaders have attempted to read from China’s script. For example, the Ugandan government in 2017 tabled a bill before parliament to amend Article 26 of the country’s constitution in order to pave a leeway for the government’s compulsory acquisition of land without interference for ”infrastructural development”. This was a very contentious issue that prompted a heated debate in the country. Luckily, the government failed to succeed in this pursuit. The idea was copied from China and attempted to be pasted in Uganda. 

China which is under a communist system evicts her people from any desired land for government projects as and when it pleases. The copy and paste attitude are definitely beyond the visible but time will reveal the other scenarios.

The emergence of China as an alternative option for loans and donations has compelled the Western donors to compete with the new donor and thus reducing their credibility in the enforcement of conditions. 

In reference to the Chinese political science review, this creates two hypotheses; 1) As China’s aid and development financing in Africa expand, the positive relationship between Western aid and the level of democracy in Africa will dissipate, all else being equal. (2) The more aid a country receives from China, the less likely it is that its democracy will develop.

barrybless24@gmail.com

3 COMMENTS

  1. Reasonable level of facts. African government has alot to learn from this article as they make decisions on where to source loans from

  2. Vitriol on China is visible. You smartly take away the reaponaonilty of African states cherey picking seemingly intelligent argumenta.

Comments are closed.