A 2018 leaked report from Kenya’s Auditor General sparked a years-long frenzy over whether the Port of Mombasa was put up as collateral against the loans from the China Exim Bank for the Standard Gauge Railway and could be seized in the event of a default.
The story is now a foundational part of the “debt trap” lending narrative that continues to cloud Chinese infrastructure financing in Africa.
A team led by Professor Deborah Brautigam, director of the China-Africa Research Initiative at Johns Hopkins University, spent the past two years researching the issue and concluded in a new report that the Auditor General was wrong in his assessment. Neither the Port of Mombasa nor any Kenyan asset was ever at risk of forfeiture to the Chinese.
Deborah and two of her research colleagues, Vijay Bhalaki from Athena Infonomics and Paris-based attorney Laure Deron, join Eric & Cobus to discuss their findings.
- The East African: Mombasa Port at risk as audit finds it was used to secure SGR loan by George Omondi
- The China Africa Research Initiative: How Africa Borrows From China: And Why Mombasa Port is Not Collateral for Kenya’s Standard Gauge by Deborah Brautigam, Vijay Bhalaki, Laure Deron, and Yinxuan Wang
- Reuters: China committed to joining Zambia creditor committee, IMF’s Georgieva says by Rachel Savage and Jorgelina Do Rosario
About Deborah Brautigam, Vijay Bhalaki and Laure Deron:
Deborah Bräutigam is the Bernard L. Schwartz Professor of Political Economy and Director of the China Africa Research Initiative at Johns Hopkins University’s School of Advanced International Studies (SAIS). Her most recent books include The Dragon’s Gift: The Real Story of China in Africa (OUP, 2010) and Will Africa Feed China? (OUP, 2015). Before joining SAIS in 2012, she taught at Columbia University and American University. Dr. Bräutigam’s teaching and research focus on international development strategies, governance, and foreign aid. She has twice won the Fulbright research award and is a recipient of fellowships from the Council on Foreign Relations, the Woodrow Wilson International Center for Scholars, and research grants from the UK Economic and Social Research Council (ESRC) and the UK Centre for Economic Policy and Research (CEPR).
Vijay Bhakai leads Athena’s strategic initiatives and overall operations of the firm. He works closely with development agencies, private sector clients and governments on strategic advisory assignments. Vijay’s research interests include Public-Private Partnerships (PPPs), public finance and social infrastructure development. The unique entrepreneurial zest he brings to his work and advisory engagements was recognized in 2017 where he was honored as an impact entrepreneur at the GSG Millennial Honors. Vijay earned his degree in chartered accountancy from the Institute of Chartered Accountants, India. He also holds a master’s degree in economics from the National University of Singapore and University of Madras. Vijay is an adjunct lecturer at Johns Hopkins University, School of Advanced International Studies.
Laure Deron is an award-winning professional with dual legal and business proficiency, Laure assists mainly industrial and commercial world corporations in particular on project finance transactions. A graduate of the Sorbonne in International Commerce Law, Laure has previously worked in international law firms as well as a world player in the field of environmental services in China and Central Asia. She teaches Company Law and Chinese Law at university level. She is a member of the Paris Bar. Her working languages are French, English, Mandarin Chinese, and Russian.
Transcript: (please note this transcript is produced by artificial intelligence so it’s not 100% accurate)