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Is it fair to say that China, through her infrastructure grants is Africa’s “Santa Claus”?

As what can be described as the “second scramble” for Africa heightens, China’s influence on the continent is ever alarming. The economic giant appears to be on a full aggressive neocolonial mission.

It’s a mission in which she certainly wants to assert herself as the world’s future center of global economic determinism. This, probably, explains her massive infrastructure grants/loans to African institutions and states.

The new headquarters of the African Union (AU) in Addis Ababa, Ethiopia, has the fingerprints of China all over it. The $200 million (£127 million) edifice is Beijing’s gift to the Pan-African institution, as she (China) continues to strengthen her influence.

China’s Infrastructure Grants to Africa and Missing Local Content in Usage

China provided 90 percent of skilled and unskilled construction workers during the building of the $200million AU headquarters in Addis Ababa, Ethiopia

ECOWAS is currently depending on the same China for the financing of a new headquarters in Abuja, Nigeria. The project promises to gulp another $32 million in grants from the Communist People’s Republic.

In terms of consolidating her influence on African states, Beijing is to build numerous public infrastructures in sub-Saharan Africa. For instance, she’s financing parliamentary structures in Zimbabwe, Congo, Malawi, Guinea-Bissau, and Lesotho, etc. She’s also reconstructing Gabon’s burnt parliament and renovating Sierra Leone’s.

Recently, the Tanzanian government signed a US $64.4 million grant with China for two major infrastructure projects in the country. The first project includes the construction of the University of Transport in Dar es Salaam, worth US $62 million. The second project is a feasibility study costing US $1.4 million towards constructing a Standard Gauge Railway (SGR). The Chinese are also financing similar projects in Nigeria, and other African countries.

China’s Infrastructure Grants to Africa and Missing Local Content in Usage

Chinese and Nigerian construction workers on the Chinese funded Abuja-Kaduna Railway Project

While most of these infrastructures indicate that funding is by Chinese grants, some are with loans. Some of these loans come from the Exim Bank of China. All these may sound good for Africa’s development but there are a good number of germane concerns.

Concerns about China’s Infrastructure grants/loans

It appears China, through these grants is increasingly becoming a “Santa Claus” to Africa. This is evident in that beneficiary institutions and governments basically have no leverage over them. Lopsided memoranda are often signed, giving the Chinese government total leverage to manage the projects. That’s why it’s common to find indigenous Chinese companies in charge of the award and execution of Chinese-funded projects.

Money for the projects is often released from China’s Exim Bank, directly into the accounts of executing companies. These contractors buy their materials from Chinese markets and shipped to the beneficiary countries. In some cases, the Chinese mount these materials within China before shipping. Skilled indigenous Chinese contractors are paid to execute the projects within the beneficiary country. And at the end of the day, an almost absolute percent of the grant finally goes back or remains within the Chinese economic space.

How does this benefit the beneficiary country?

Basically, the only benefit for the receiving institution or state is the physical project, with a few unskilled employment opportunities. Very few or no skilled local African personnel acquire technical training at the end of such projects. Management of technological installations in such infrastructures is still dependent on the Chinese firm concerned.

Spy technologies are even sometimes allegedly installed in order to track the activities or secret dealings of the beneficiary institution. Such is the case with the new headquarters of the AU in Addis Ababa, Ethiopia. A French Magazine recently accused China of hacking AU headquarters’ computer systems every night for five years and downloading confidential data.

Need for local content in the execution of Chinese projects

Local content is almost completely missing in the execution of Chinese grants/loans inspired projects. There’s need for African governments to review the rules governing Chino-Africa relations. This is especially necessary in the domain of trade and implementation of Chinese-funded projects in Africa. The population of the beneficiary country must be able to acquire skilled knowledge at the end of such projects.

African leaders must completely review the idea of China supplying both the financial and necessary human resources. This should apply, especially, in cases where such financial resources are proceeds of a loan from the Chinese government. Nigeria and Rwanda for instance, are two African countries already enforcing local content orders or laws. These laws provide opportunities for a reasonable percentage of local skilled labor especially, in executing foreign-financed projects.

Where such local skills are not available, the foreign contractors, as part of the rules of engagement, must train a reasonable percentage of local labor on the job. This is to help build the capacity of local citizens in such domains. By so doing, they can effectively manage such infrastructures upon completion or do similar jobs for the nations.

 

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