Another $60 billion for Africa but not for ‘vanity projects’, says Chinese President Xi
Chinese President Xi Jinping announced $60 billion in funds for eight initiatives over the next three years, in areas ranging from industrial promotion, infrastructure construction and scholarships for young Africans.world Updated: Sep 03, 2018 20:25 IST
President Xi Jinping on Monday pledged $60 billion in financing for Africa amid growing concerns about the debt trap associated with Chinese aid, saying the funds were not for “vanity projects” but to remove developmental bottlenecks.
Delivering the keynote address at a summit with African leaders, Xi wrote off the debts of some poorer countries in Africa.
The new promise of $60 billion – the same amount that China pledged at the Forum on China-Africa Cooperation (FOCAC) held in 2015 – came amid worries about China’s “debt trap” diplomacy, which Beijing has denied engaging in.
Chinese state media dismissed reports of protests against Chinese projects in Africa as only a handful of demonstrations that are a result of the Western media’s bias.
A study by the Center for Global Development, a US think tank, found “serious concerns” about the sustainability of sovereign debt in eight Asian, European and African countries receiving funds from China’s Belt and Road Initiative. Djibouti has become heavily dependent on Chinese funding after China opened its first overseas military base in the country last year and locals in other African countries have complained about the practice of using Chinese labour for building projects.
Addressing African leaders at the Great Hall of the People, Xi outlined details of where the money will flow and debt waivers for poorer countries.
“The financing includes $15 billion of grants, interest-free loans and concessional loans, $20 billion of credit lines, the setting up of a $10 billion special fund for development financing, and a $5 billion special fund for financing imports from Africa,” Xi said in his speech.
“Chinese companies are also encouraged to make at least $10 billion of investment in Africa in the next three years.
“Government debt from China’s interest-free loans due by the end of 2018 will be written off for indebted poor African countries, as well as for developing nations in the continent’s interior and small island nations.”
Xi added: “China-Africa cooperation must give Chinese and African people tangible benefits and successes that can be seen, that can be felt.”
He said Beijing will set up a “China-Africa peace and security fund” and continue providing free military aid to the African Union.
Speaking at a separate business forum, Xi warned that the money should not be used for “vanity projects”.
“China’s cooperation with Africa is clearly targeted at the major bottlenecks to development. Resources for our cooperation are not to be spent on any vanity projects but in places where they count the most,” he said.
Xi also promised the development in Africa will be green and sustainable.
China’s contention that it stands for Africa’s development and is not out to “colonise” the continent for its abundant resources found strong support from South African President Cyril Ramaphosa. Speaking at the summit, Ramaphosa said the meeting “refutes the view that a new colonialism is taking hold in Africa, as our detractors would have us believe”.
Reuters reported every African country is represented at the business forum, apart from eSwatini, Taiwan’s last African ally that has so far rejected China’s overtures to ditch Taipei and recognise Beijing.
Besides Ramaphosa, Egypt’s Abdel Fattah al-Sisi, Zambia’s Edgar Lungu and Gabon’s Ali Bongo are among the leaders attending the summit. So is Sudan’s controversial President Omar al-Bashir.
Bashir, in power for nearly 30 years, is wanted by the International Criminal Court for war crimes over killings and persecution in Sudan’s Darfur province between 2003 and 2008.
First Published: Sep 03, 2018 16:57 IST