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China/Africa: New departures

By Stephen Chan
Posted on Wednesday, 18 April 2018 11:31

China’s long-term interests as a rising power are in the spotlight across the world. Former United States (US) secretary of state Rex Tillerson launched his Africa tour in March with strong criticism of China’s role on the continent.

Going in all guns blazing was a way for Tillerson to draw attention in the US media and to help construct an agenda. A lot of damage has been done by Donald Trump’s remarks about Africa. There is criticism that the US administration seemed to be neg­lecting the region. Perhaps Tillerson’s remarks can be seen as a compensation.

General Thomas Waldhauser’s remarks about China’s base in Djibouti are in a different category. The head of the US Africa Command told the House Armed Services Committee on 6 March he was concerned that the Chinese may take over the port, which services US military operations. Djibouti, as China’s only overseas military base, has a strategic value.

It is at the apex of some key international trade routes. The general may want to talk up the threat. Many countries – China, France, Germany, Italy, Russia and the US – have bases in Djibouti. Perhaps the US concern is that China is using its presence in Djibouti to build up its capacity. They should be delighted that China is basing its ships there, as it gives them a good opportunity for reconnaissance.

For Trump, China’s presence in Africa is low on the list of priorities. There is dialogue all the time about Africa. We hear that Tillerson checked in at the same hotel in Addis Ababa as Russia’s foreign minister Sergey Lavrov. I would be surprised if there was not a discreet meeting.

African governments should be able to find ways to benefit from the competition between different powers, but it is easy to say that and much harder to do it. Africa is not at the top of China’s priority list either and it is not something that is going to claim primacy of attention.

The Chinese have been very concerned about the North Korean issue, and they are very concerned about making sure that the One Belt, One Road construction initiative gets up and running. They are genuinely concerned about building up a presence in the Asia Pacific region.

In all of this, individual African countries are down the list. Beijing is building up its diplomatic capacity just as the US seems to be winding down its own. China is putting money into peacekeeping and humanitarian operations. Beijing is making an investment.

Look at the numbers of visits to Africa by its presidents and prime ministers; compare those numbers with the trips by top officials from Britain, France or the US. Specialised agencies, such as the Chinese prime minister’s State Council and the country’s think tanks now have a lot of expertise on Africa.

So the division of labour there is to have more kinds of things prepared in advance … for when the presidency thinks it’s time to take initiatives on Africa policy. But in terms of being consumed with Africa 24 hours a day, that’s definitely not the case at all. Having said that, China’s future scenarios do need Africa to be cooperative and friendly.

Look at the size and structure of the investments they’ve made. They are front-loaded so they would like an assurance there would be redemption of that investment in the future. Just because Africa is not top of the list, it doesn’t mean it is bottom of the list either.

The political effects of ending term limits in China

President Xi Jinping’s lifting of terms limits on the presidency will not have any direct effect on Africa because the continent has already taken a turn towards forms of limited democracy. And there is a lot of pressure on presidents who want to overstay their welcomes.

The Democratic Republic of Congo (DRC) is a case in point. So, the Chinese example of president Xi being in office longer than two terms is not going to be determinate. Opposition does exist in African countries of a kind that’s not possible in China.

Those opposition movements are not going to want to have to roll back on the limitation of presidential terms in their countries. As for the Chinese themselves, I think there is a weary resignation that this man is going to be around for a long time and that he is going to be some kind of elevated demi-god type of figure like Mao Zedong became.

He will be tolerated if he can keep producing the goods in terms of the continual rise in the standard of living. This brings us full circle, of course, because this will depend on the success of international trade. Xi has to deliver prosperity and stability, and he needs to have a foreign policy, an international trade and investment policy.

China does not want to run down its huge savings pile beyond a certain point. The Chinese understand they have to inject some discipline into the volatility of the stock market. They’ve got to control the overheating of the property market. President Xi has to bring progress to bear on all of these areas.

China does not want to run down its huge savings pile beyond a certain point

And if he is not successful, no matter whether or not he serves two terms, three terms, or whatever, pressure will build up within the Communist Party for him to go. My assumption is that President Xi will not want to have term limits removed for officials beneath him, because of course he wants to maintain ways of getting rid of people. You’re going to see smarter forms of central control.

In many countries, civil society is much more inventive with media, as both governing parties and opposition parties are slow to catch up with mobile and internet technologies. So this can still be a citizen-led revolution in many, many jurisdictions. China can censor communications because it is one country with one gigantic, joined-up network.

That’s just not the case in Africa, where there are so many providers and where communications services cross national boundaries. One company may provide communications for three or four countries in Southern Africa. China is a very different example to what you get in the more fragmented African situation.

Africa’s growing debts to China

When you add it all together, China has a very large commitment to Africa. As the banks are playing an increasing role in this investment, they need a return on their money. They certainly need to recuperate their money.

When you add it all together, China has a very large commitment to Africa

There is anxiety in China that this should not become a liability in the future, so they are applying banking criteria and attaching conditions. Even if a loan is, to a large extent, a soft loan, it either has to be repaid or to be renegotiated into some other kind of liquid asset.

A lot of African countries are being careless about how much debt they are taking on, on the assumption that China will write down or write off these debts. I don’t think the Chinese have got a strategy to make African countries indebted. There is meant to be some kind of control and some kind of African agency when it comes to financial management.

This is where the Chinese do have a line. In other words, if it all gets too careless on the part of the partner government, then, as in the case with Zimbabwe, they are prepared to see, let us say, unorthodox change take place. I do not think it is going to be a battle of ideas, certainly not of ideologies like in the past.

But that is something that the Chinese would like the Africans to emulate – a greater capacity to direct national finances at central bank governor and finance minister levels. They want to have a surety of relationship. If they don’t have stability in terms of the African partner on fiscal issues, then they can be very reluctant to take too many risks themselves.

China’s scramble for strategic minerals

The Chinese want to secure the best possible deal, and if this means getting into bed with companies such as Glencore, they would be prepared to do it – not only in mining but also in petroleum exploration. Now, the Chinese know that you have a concentration of cobalt in the DRC, just as they know there is a concentration of platinum in South Africa and Namibia.

They will be very careful to secure some kind of entry point for platinum and cobalt. All this is looking into the future, it is a strategic interest. No one needs the cobalt now. Although we’re making a turn to electric cars, it is going to be some years before we have a fully electrified car network throughout the Western world, never mind the rest of the car-driving world.

What is at stake now is ownership or strategic interest in minerals like cobalt for the future. Just how much of a long game are the Chinese going to be prepared to play for this particular mineral? They have already got long-term futures in petroleum and platinum.

What is at stake now is ownership or strategic interest in minerals like cobalt for the future

Even for China, there is going to be over-exposure at some point. So they are likely to drive a very hard bargain in a place that is as volatile as the DRC. Analysts have voiced concerns about the Chinese economy and the role of its market in global demand for resources.

It is a very, very big one, and there are all types of corrective mechanisms to withstand trouble hotspots. It’s going to take an awful lot to bring the entire economy of China into some kind of endangered zone.

Non-interference and Zimbabwe’s transition

General Constantino Chiwenga was in Beijing shortly before the coup in Zimbabwe. I’m absolutely certain, although there is never going to be any iron-clad evidence, that the Chinese were informed of the options that Chiwenga was facing. And so the Chinese said they would not intervene.

One thing the Chinese quite like is stability, not only in China but in its relationships with other countries. They put a high premium on good management. It is clear that those things were left behind during the last years of former president Robert Mugabe.

The Chinese were concerned about pouring more good money after bad, so I think they were happy to see there would be a change of regime. What surprised a lot of us was that the Chinese did not come immediately to Zimbabwe’s economic aid.

The government is in arrears to international financial institutions and has billions of dollars in foreign debt. There will not be any serious discussion about renegotiating the debt until those arrears are paid off. China, like the Western powers, is waiting for evidence that Mnangagwa is serious.

For the Western powers, the elections this year are a litmus test. I’m not sure what the litmus test is for the Chinese. Perhaps they want to see more heads rolling in terms of the anti-corruption campaign. This makes it difficult for Mnangagwa, as some of his closest lieutenants have been massively corrupt.


Stephen Chan is rector of London University’s School of Oriental and African Studies

This article was first published in The Africa Report’s April 2018 edition

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