Gabon's President Brice Clotaire Oligui Nguema waves as he arrives at Beijing Capital International Airport ahead of the 2024 Summit of the Forum on China-Africa Cooperation (FOCAC) in Beijing, China, Sep. 1, 2024. Ken Ishii/Pool via REUTERS © Thomson Reuters

This week, China is set to convene a summit in Beijing with 50 African nations, encouraging them to increase their imports of Chinese products before Western restrictions on exports, including electric vehicles and solar panels, take effect.

In return, China is expected to offer additional commitments for loans and investments.

However, the African leaders attending this triannual event may not be easily persuaded. They will likely demand clarity on how China intends to fulfill its previous commitment made at the 2021 summit to purchase $300 billion worth of goods.

Additionally, they will seek updates on the status of ongoing Chinese-funded infrastructure projects, such as a railway aimed at connecting the broader East African region.

Eric Olander, co-founder of the China-Global South Project, noted, “The advantage will go to those nations that have thoroughly analyzed the shifts in China and align their proposals with its newly focused priorities.”

This presents a significant challenge for a continent that typically has limited understanding of China.

As Africa's largest lender, investor, and trade partner, China is shifting its strategy away from financing large-scale projects in the resource-rich region, opting instead to promote the sale of advanced and green technologies that Chinese companies have heavily invested in.

With the impending restrictions on Chinese exports from the West, Beijing's primary focus will shift towards securing buyers for its electric vehicles and solar panels, sectors where the United States and European Union have indicated an excess supply.

Additionally, China aims to establish production facilities in international markets.

The country has begun to adjust the terms of its loans to African nations, allocating more funds for solar energy projects, electric vehicle manufacturing, and 5G Wi-Fi infrastructure, while reducing investments in traditional infrastructure like bridges, ports, and railways.

According to data from Boston University’s Global Development Policy Centre, last year, China extended 13 loans totaling $4.2 billion to eight African countries and two regional financial institutions, with approximately $500 million designated for hydropower and solar initiatives.

 

GEOPOLITICAL JOSTLING

As President Xi Jinping prepares to inaugurate the ninth Forum on China-Africa Cooperation Summit on Thursday, he is anticipated to advocate for engagement with China's rapidly expanding green energy sector to leaders from Gambia, Kenya, Nigeria, South Africa, and Zimbabwe. Delegates from nearly all African nations will be present, with the exception of Eswatini, which lacks diplomatic relations with Beijing. In a bid to maintain its influence, the United States has begun hosting African leaders, while Britain, Italy, Russia, and South Korea have also organized summits focused on Africa in recent years, acknowledging the region's youthful population and its 54 seats in the United Nations. Nevertheless, China's significant role as a financial and trade partner elevates the importance of its meetings.

"No other development partner contributes as much," stated Hannah Ryder, founder of Development Reimagined, an African-owned consultancy.

"However, can African leaders compel China to ensure that the benefits are more favorably aligned with African interests?"

In terms of aligning mutual interests, China is likely to emphasize enhancing trade and securing access to essential minerals such as copper, cobalt, and lithium from nations like Botswana, Namibia, and Zimbabwe.

However, it may exercise caution regarding new funding commitments, particularly in light of recent debt restructuring efforts in countries like Chad, Ethiopia, Ghana, and Zambia since the last summit in 2021.

"We can expect a continued cautious approach to financing large-scale projects," noted Lina Benabdallah from the Centre for African Studies at Harvard University, adding that Beijing may prioritize technology transfers instead.

Yvette Babb, a portfolio manager at William Blair, expressed her eagerness to see how many new financial commitments emerge from the summit and how existing debts to African nations will be addressed.

However, China's eagerness to provide loans could be tempered by security issues, including a recent conflict between Niger and Benin that resulted in the deaths of six Nigerien soldiers protecting a PetroChina-supported pipeline, as well as violent protests in Kenya in response to increased taxes.