China pledges $50 billion in ‘financial support’ to Africa over next three years

Chinese President Xi Jinping on Thursday, September 5, promised more than 50 billion dollars (45 billion euros) over three years to African countries, some fifty leaders of which are in Beijing for the China-Africa Cooperation Forum.

“China is ready to deepen cooperation with African countries in industry, agriculture, infrastructure, trade and investment”declared the head of state, during the opening ceremony of the summit, which is being held until Friday at the People’s Palace.

“In the next three years, the Chinese government wants to provide financial support of 360 billion yuan”or $50.7 billion, he announced, also promising to help “create at least one million jobs in Africa”Also speaking at the summit, UN Secretary-General Antonio Guterres said that China and Africa, by working together, could “Leading the renewable energy revolution”.

“China’s remarkable development record, especially in poverty eradication, is a great source of experience and expertise”he said.

China is already Africa’s largest trading partner, with $167.8 billion (€151.8 billion) in trade in the first half of 2024, according to Chinese state media. It has sent hundreds of thousands of workers and engineers to build these major projects over the past two decades and has gained privileged access to Africa’s vast natural resources, including copper, gold and lithium.

Loans from Chinese state-owned banks have helped finance many growth-boosting infrastructure projects (railways, ports, roads, etc.), but they have raised questions about the debt of some countries. However, the amount of loans granted by China to African countries in 2023 has been divided by six compared to the peaks reached in 2016, when they were close to $30 billion (€27 billion).

Analysts say the current economic slowdown in China is pushing Beijing to reduce its investments in Africa, despite growing competition from the United States on the continent for political influence and access to natural resources.

Trains and roads

On the sidelines of the summit, the Chinese president has had one-on-one talks in recent days with around ten African leaders, to whom he promised greater cooperation on a whole series of projects.

On Wednesday, Zambian President Hakainde Hichilema announced an agreement between the Zambian national electricity company (Zesco) and the PowerChina group to expand the use of solar panels on roofs.

Nigeria – one of the African countries that has borrowed the most from it – and China have announced plans to “strengthen cooperation” in infrastructure, in particular “transport, ports and free trade zones”.

Tanzanian President Samia Suluhu Hassan has secured a commitment from Xi Jinping to push ahead with a delayed rail link project with Zambia. According to Zambian media, Beijing has pledged $1 billion for the crucial project in the resource-rich part of the African continent.

As for Zimbabwe, it has obtained the promise of enhanced cooperation in “agriculture, mining, clean energy and transportation infrastructure”according to a joint statement. Kenyan President William Ruto also announced that his Chinese counterpart had promised to open the Chinese market to his country’s agricultural products.

The two parties also agreed on the extension of the Standard Gauge Railway (SGR) line, linking Nairobi, the capital, to the port of Mombasa, financed in particular by the Export-Import Bank of China (Exim bank).

China has also pledged more cooperation on the Rironi-Mau Summit-Malaba highway, which is expected to cost $1.2 billion, according to Kenyan media. Last year, William Ruto asked China for a $1 billion loan and restructuring of existing debt: his country now owes China more than $8 billion.