Africa keen for more Chinese development finance, despite economically bumpy road towards FOCAC summit

Africa keen for more Chinese development finance, despite economically bumpy road towards FOCAC summit

Chinese and African diplomats have started to negotiate the agenda for the Forum on China-Africa Cooperation (FOCAC) taking place in Beijing later this year.

Concessional development finance, infrastructure, trade, climate change and green development, and global governance are expected to top the agenda during the summit, according to diplomatic negotiations between China and African countries.

But FOCAC will also come at a time of growing economic uncertainty; China is facing a property crisis as well as weak business and consumer confidence, while many African countries are in debt distress.

Although the era of massive Chinese bilateral lending is over, observers have said they expect Beijing to accelerate investments in Africa that focus on agriculture, industrialisation and beneficiation – mineral processing.

On April 23-24, 42 diplomats from 29 embassies, including 20 African ambassadors in China, met at a retreat in Beijing to work on setting the FOCAC agenda. The retreat was jointly organised by Beijing-based consultancy Development Reimagined and the African Union representative office in China.

Attendees went over commitments that were made at the last FOCAC, held in 2021, and talked about attracting Chinese development finance, trade and strengthening agricultural cooperation, which has become a key focus for China to increase imports of food products from Africa. Climate change and green development, global governance, health and pharmaceutical production were also discussed, according to Development Reimagined.

After two days of African-only talks, the ambassadors were joined by Chinese diplomats, including Wu Peng, the Chinese foreign ministry’s director general of African affairs.

He highlighted China’s commitment to nurturing strong bonds with Africa, writing about the meeting on social media platform X: “We are always willing to hear suggestions from African countries and think tanks.”

Wu also advocated for African-led initiatives at the meeting, as well as showing a readiness to understand the continent’s development needs.

Representatives from the China-Africa Development Fund, China-Africa Business Council, Chinese Academy of International Trade and Economic Cooperation, and the Centre for International Knowledge on Development took part in the retreat.



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Jing Cai, Africa-China cooperation programme manager at Development Reimagined, said the meeting also aimed to “articulate needs for support for the work of African ambassadors and diplomats in China, with concrete action items to take forward for the preparation of FOCAC 9 in 2024”.

Held every three years, FOCAC is a gathering of China and African countries, with the only excluded nation being eSwatini, which has diplomatic relations with Taiwan. The location of the summit alternates between China and Africa.

FOCAC is the most important mechanism for engagement between China and the African continent. It is also traditionally the forum where big financial commitments are made by China.

Africa’s importance to Beijing is not just economic – politically, most countries in the continent vote on international issues in alignment with China.

But while Chinese President Xi Jinping pledged a billion doses of Covid-19 vaccines to Africa at the last FOCAC, which was held in 2021 in the middle of the coronavirus pandemic, financial promises were lower than in previous forums: Beijing pledged US$40 billion at that time, whereas in both 2015 and 2018, around US$60 billion was pledged.

Not only was there a dip in funding promises made at FOCAC, but also in the last few years, Chinese lenders, including policy banks the Export-Import Bank of China (China Eximbank) and China Development Bank, have been cautious in their lending, demanding bankable feasibility studies amid African debt distress.

Despite the possible barriers, a Development Reimagined statement expressed optimism about this year’s FOCAC.

“Since Africa’s development needs remain significant, especially in infrastructure, we anticipate that Chinese lending will likely rebound to pre-pandemic levels,” it said.

Ambassador Lynette Mwende Ndile, Kenya’s deputy head of mission to China, wrote on X about the retreat, saying the road to FOCAC 9 had begun. The retreat, she said, helped with “agenda setting for more deliberate collaboration and partnerships in our Africa-China strategic cooperation”.

But with several months yet until September’s summit, African governments are still deliberating about what they want to be discussed, according to Development Reimagined chief executive Hannah Ryder.

At the FOCAC summit held in 2021, Chinese President Xi Jinping pledged Covid vaccines – but not as much financing as in previous summits. Photo: Xinhua

“Key areas for discussion are unlikely to be significantly different from the last 24 years, such as trade – especially value addition [and] not just volume – finance, agriculture, and people-to-people relations,” she said.

“In the retreat, it was also clear that global governance reform and manufacturing – including … pharmaceuticals and other medical products as well the green transition – will no doubt be key areas African countries are looking to engage China on.”

Sub-Saharan geoeconomic analyst Aly-Khan Satchu said the importance of FOCAC could not be underestimated.

“The FOCAC summit remains for me the seminal and most consequential Africa-China meeting,” he said.

Satchu said that in 2018, Xi indicated the end of the era of “go go” lending when he spoke of no longer funding “vanity” projects, and in 2021 he spoke of “green lanes” and focused on agriculture.

“This time around I expect the FOCAC to seek to accelerate investments which focus on beneficiation, industrialisation and of course agriculture, and on assistance in navigating what has been a perilous debt situation for the continent,” Satchu said. “I expect a significant and accelerated move in regards to sidestepping the dollar and moving dramatically towards the renminbi in terms of trade.”

David Shinn, a China-Africa specialist and professor at George Washington University’s Elliott School of International Affairs, said Chinese lending was unlikely to ever again reach the 2016 peak of US$28 billion. He said over the past three years, Chinese loans had sat at around US$1 billion annually.

“While this low number will probably rise, it will not increase substantially for several reasons,” Shinn said. “Many African countries are reluctant to take on more debt.”

Part of the reason is also that China has already completed so many infrastructure projects in Africa – so there are not as many left to do.

“There are fewer large, economically viable infrastructure projects to finance in Africa. China is experiencing some challenging economic issues that will likely cause it to be more restrained in offering large infrastructure loans,” he said.

Meanwhile, Shinn said, China would try to replace large loans with more foreign direct investment, much of which may be directed towards the agricultural sector. He said food security was a major internal goal for China; Beijing was anxious to increase sources of food supply from around the world, including Africa.

“China has been working for many years to increase trade with Africa. The September FOCAC meeting will almost certainly include another effort to do so,” he said.

Shinn added that China, Africa’s largest trading partner since 2009, has had far more success increasing its exports to Africa than it has had increasing African exports to China.

“Since 2012, Africa has had a trade deficit with China. African oil exports to China dropped substantially in 2023. If this trend continues, Africa’s trade deficit with China will likely increase,” he said.



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