Changing Realities: China-Africa Infrastructure Development

Abstract

T hrough an extensive portfolio of infrastructure investments, China has played a crucial role in helping Africa reduce deficits in its infrastructure. Over the past decade and a half, Chinese state-owned or state-aligned construction and engineering companies have strategically entered African markets with assistance from the Chinese government. Under China’s Belt and Road Initiative (BRI), Chinese companies took on mega-infrastructure projects, especially in the energy and transport sectors, that could aid African countries with achieving higher levels of development. However, these mega-BRI projects came with hefty price tags that have contributed to compounding the debt stress of several African nations. In this regard, many international (and especially Western) actors have accused China of predatory lending practices and debt-trap diplomacy. This narrative has been further amplified amid the Covid-19 pandemic, which has had significant ramifications for BRI projects in Africa and around the world. The pandemic has created some doubt about whether Chinese-funded and -built infrastructure projects can be completed and, more importantly, whether African states have the fiscal capacity to repay these development loans. With reduced revenues available to African governments, the risk of defaulting on loan repayments is high. Moreover, because of the burden of loan repayments, African states are handicapped in their response measures to Covid-19 and its economic consequences. The Eighth Forum on China-Africa Cooperation (FOCAC) in November 2021 demonstrated that due to changing realities—including China’s domestic economic concerns, U.S.-China trade tensions, the global economic impact of Covid-19, and Africa’s pandemic-induced debt stress—Beijing seems to have realized that it cannot continue to be Africa’s go-to bank for financing infrastructure development. This essay outlines that China may not be as willing as it was in past years to finance infrastructure development projects in Africa. It explores the impact of Covid-19 on the development of BRI infrastructure projects in Africa and briefly assesses the validity of the debt-trap and predatory lending accusations leveled against China. Additionally, the essay addresses