While European countries divided Africa, some parts of Asia and North and South America among themselves hundreds of years ago, the Chinese were content to mind their own affairs. But their recent attitude towards much of the outside world seems like the Apostle Paul in early Christianity – someone who came to Christianity late but was by far the most impactful. Better late than never, the saying goes – and the Chinese are assiduously making up for lost time.
Through President Xi Jinping’s Belt and Road Initiative – launched in September 2013 – China aims to gain leverage in world affairs and enhance its image abroad through ambitious infrastructure projects in strategic countries while acquiring stakes in the natural resources of those countries in return.
As of March 2022, the number of countries that have joined the Belt and Road Initiative by signing a Memorandum of Understanding with China is one hundred and forty-seven (147). Forty-three (43) of these countries are in Sub-Saharan Africa; Thirty-five (35) are in Europe & Central Asia (including 18 countries of the European Union); twenty-five (25) are in East Asia & pacific; twenty (20) are in Latin America & Caribbean, 18 are in Middle East & North Africa and six (6) countries are in South East Asia.
Under the Belt and Road Initiative, Ghana has signed a bilateral agreement with China, in which China will finance $2billion worth of infrastructural projects such as the building of railways, roads and bridges. As part of this noble initiative, the Chinese government constructed the Cape Coast stadium during the presidency of Professor John Evans Atta Mills for Ghana.
As expected, sub-Saharan Africa is benefitting the most from the Belt and Road Initiative. Of course, it is the world’s poorest region and therefore is the region that needs the most assistance. Indeed, sub-Saharan Africa receives more aid than all other regions of the world. But more importantly, China extends more help to Africa because of its vast mineral and petro-carbon wealth.
Africa holds 30 percent of the critical minerals that power the modern world, including 40 percent of the world’s gold, up to 90 percent of its chromium and platinum, and the largest reserves of cobalt, diamonds, platinum and uranium in the world, according to the United Nations Environment Programme; not to mention the vast petroleum wealth of countries like Nigeria, Angola, Libya, Sudan, Algeria and many others.
Chinese lenders account for 12% of Africa’s private and public external debt, which increased more than fivefold to $696 billion from 2000 to 2020. China is a major creditor of many African nations, but as more countries have joined the Belt and Road Initiative its lending has fallen in recent years and is set to remain at lower levels.
China now focuses on strategic investment in countries with mineral wealth; especially oil. China needs oil for its industries and what better place to turn to for Brent crude but Africa. Africa is the second largest region to supply oil and gas to China, after the Middle East, with more than 25% of its total oil and gas imported into China.
The China Petroleum & Chemical Corporation (SINOPEC) and China National Offshore Oil Corporation (CNOOC) are well established in Nigeria and Angola, while China National Petroleum Corporation (CNPC) has a stake in the Rovuma LNG project in Mozambique.
Surging domestic energy demand has led China to diversify its natural resources imports and the upstream footprint of China’s petroleum companies has increased substantially to nearly 20 African countries.
One of China’s largest trade partners is Africa’s largest oil producing nation, Nigeria. Nigeria currently pumps 2 million barrels of oil a day and has a goal of producing 3 million barrels per day by 2023. As China’s domestic oil production continues to decline, experts predict that in the next 15 years up to 80% of China’s crude oil supply will be imported.
China for many years was the world’s sleeping giant. The country seems to have awoken. The Chinese civilization that is thousands of years old and with the country leveraging its huge population to become the world’s second biggest economy, the Belt and Road Initiative is placing China where it should have been a long time ago.
The writer is executive president at Africa Growth Foundation; a policy think-and-do.
Email him: [email protected].
Phone him: 0558719614.
