CHINA-AFRICA RELATIONS: A WIN-WIN FOR ALL

By Steven Akabwayi

Increasingly, China is becoming a beacon of hope for the African continent. Now that the BRICS is here bigger, and better than before with the addition of two African countries with Egypt and Ethiopia joining South Africa, China will leverage this opportunity to strengthen its economic foothold on the African continent.

Speaking at the BRICS summit,  South African President Cyril Ramaphosa who was the summit’s chair envisioned a community of shared development and progress between China and Africa referring to it as “ a win-win” partnership.

“Our relationship with China will be one of promoting win-win outcomes based on important projects that we have initiated such as the African continental free trade area that is going to be the engine of our economic development”, noted South African leader, Cyril Ramaphosa.

On the other hand, his Chinese counterpart President Xi Jinping expressed commitment to supporting Africa’s industrialization aspirations which will be achieved by rolling out the required initiatives. “China will launch an initiative in support of Africa’s industrialization”, Xi said adding that the Chinese government will also harness its resources for cooperation with Africa and initiate business to support Africa in growing its manufacturing sectors so as to realise industrializationand economic diversification.

Indeed, on the eve of the summit, in an Op-Ed, President Xi emphasised importance of mutual win-win cooperation between China and African countries which he emphasised will always be a guiding principle for China’s cooperation with African countries, writing that, it is “ten years since I put forth “sincerity, real results, amity and good faith” as the principles for China to develop its relations with Africa. The past decade has witnessed our joint pursuit of a China-Africa community with a shared future in the new era, and the completion and handover of a host of projects including the Africa CDC Headquarters, the Foundiougne Bridge in Senegal, the Nairobi Expressway and the Mombasa-Nairobi Railway, renewing China-Africa friendship across the vast lands of China and Africa…”

China has had several initiatives and interventions on the African continent one of them being the Belt and Road Initiative (BRI). The BRI that was launched in 2013 by President Xi Ping was based on the Silk Road that existed many centuries ago and acted as a global pathway for trade in goods and services also serving as a channel for sharing ideas and culture.

The BRI was primarily established to link East Asia and Europe through physical structure but was later expanded to Africa and other continents by the Chinese government significantly broadening the Chinese economic foothold on the continent.

Barely marking its first decade this year, the BRI’s impact have already been felt on the continent. Under the BRI there has been the establishment of railway networks in Eastern African countries connecting Addis Ababa and Djibouti, and other infrastructures such as ports in Kenya, and Karuma dam in Uganda among others.

These projects will accelerate regional integration by improving transportation and logistics which will boost economic development.

At the BRICS summit, member states expressed concern relating to trade-restrictive measures and inconsistencies stemming from international financial institutions such as the World Trade Organisation and the World Bank that are dominated by Western powers.

In his letter issued on 17th August, President Museveni with bitter concern condemned Bretton Woods institutionsafter the World Bank announced that it was freezing approval of new aid and loans towards Uganda the move that he described as an act an act of “provocation and arrogance”.

Many African countries have expressed resentment towards skewed financing arrangements from Western countries and institutions. These often come with stringent conditions that borrowers from developing economies must meet, the conditions which some observers say are always divorced from African realities and needs.

The harsh borrowing conditions by Western financial institutions have made most African countries turn towards China given its financing strategy that comes in the form of grants, aid, and loans at free or low interest rates.

The Chines loans are always directed on essentials sectors such as mining, transport and construction among others which boost Africa’s economies.

There has also been growing criticism and debates about unfair policies and practices by the Bretton Woods institutions.

Emerging economies have continuously called out America for holding unequal powers and favoritism towards Bretton Woods institutions weaponizing dollar currency for example through unfair sanctions.

It’s against this backdrop that the BRICS leaders tasked their respective finance ministries and Central Banks to come up with a viable plan for the use of local currencies, payment instruments, and platforms by the time they report back for the next BRICS summit.

Steven Akabwayi is a Research Fellow at Sino-Uganda Research Centre.

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