China’s President Xi Jinping announced a massive investment plan for African nations. Here are all the details.
China will renew its investments in the African continent, President Xi Jinping announced at the Forum on China-Africa Cooperation Summit (FOCAC) in Beijing. The pledge came on Thursday after a week-long meeting with over 50 African leaders in the Chinese capital.
Africa is the world’s fastest-growing continent, with over 1 billion people and a soil rich in natural resources. However, Africa also remains the world’s poorest continent, constantly in urgent need of external aid.
For centuries, Africa was divided between spheres of influence of external powers. Even after the de-colonization from European countries, Africa remains a battleground between foreign actors, from the United States to Russia to China.
In the last 20 years, Beijing massively invested in the continent, with over 20% of Africa’s debt currently owned by China. In some instances, like the Republic of Congo, that share goes as high as 40%.
The investment plans, part of the larger Belt and Road Initiative, built several critical infrastructures across the continent including railways, ports, and highways.
Recently, however, Chinese investments waned as African countries struggled to repay their debt. Kenya, for example, pays two-thirds of its annual budget to repay offshore debt interests.
After its peak in 2016, Chinese investments in Africa declined steadily. Until now.
New investments
On Thursday, Xi Jinping announced $50.7 billion in additional investments in Africa, which will finance over 100 infrastructure projects across the continent. The package is divided into $29.6 billion in loans, $11.3 billion in aid, and $9.9 billion in encouraged private investments.
That is a massive increase since last year when $4.6 billion in loans to African nations were approved.
“We are ready to assist in the development of the African Continental Free Trade Area, and deepen logistics and financial cooperation for the benefit of trans-regional development in Africa,” Xi said.
Special guest Antonio Guterres, the United Nations Secretary-General, praised Beijing’s initiative saying “China’s remarkable record of development – including on eradicating poverty – provides a wealth of experience and expertise.”
Unlike in a previous summit in Dakar, Senegal, Xi Jinping did not pledge to increase trade between China and Africa. At that summit in 2021, Xi set the goal of $300 billion in goods traded from Africa to China by the end of 2024. According to Reuters, that goal has already been reached at $306 billion.
Critics say the additional investment will deepen African ties to China, especially for the debt burden it will cause.
