The 2018 Forum on China-Africa Cooperation summit in Beijing wrapped up last week with the expected fanfare following the announcement that the Chinese provide another $60 billion financial package.
While that $60 billion figure was the same as the amount offered in the 2015 FOCAC financial package, the allocation of the funds is very different.
Billions of dollars of interest-free grants (the free money) were replacement by concessional loans (interest-bearing debt). Almost 20% of the entire package, $10 billion, is devoted to attracting Chinese investment to Africa. While that sounds great, it’s really not that big of a deal since China already invests around $3 billion annually in Africa.
So, with a FOCAC package that is arguably more beneficial to China’s lenders than Africa’s borrowers combined with a steady downturn in trade, a growing number of analysts are starting to conclude that we have reached the peak of China’s economic relationship with Africa.
Longtime China-Africa scholar Luke Patey, a senior researcher at the Danish Institute of International Affairs, is among those who believe that the outcome of this year’s FOCAC summit clearly demonstrated that Africa now has a diminished role in China’s global economic agenda.
Luke joins Eric & Cobus to discuss what’s behind this trend and his provocative column in the Financial Times on why the “Chinese Model is Failing Africa.”
- Mail & Guardian: How much is China’s $60-billion really worth? by Claire van den Heever
- The Nation (Kenya): China’s “Marshall Plan” for Africa — debt or new deal? by Peter Kagwanja
- The Daily Standard: China in Africa: A reason for dread or celebration? by XN Iraki
About Luke Patey:
Luke Patey is a senior researcher at the Danish Institute for International Studies, Lead Senior Research Fellow on Africa at the Oxford Institute for Energy Studies, University of Oxford, and a Fellow of the Rift Valley Institute. His research focuses on China’s foreign economic relations and global security engagement; China and India’s relations in Africa; the geopolitics of oil; the political economy of oil in Africa (particularly in Sudan, South Sudan, Uganda, and Kenya); political and security risk in the international oil industry.