China’s Affected African Aid Admonitions
A comprehensive data base compiled by researchers at the Center for Global Development and William and Mary College attempts through media filings to track Chinese official and private assistance to Sub-Sahara Africa the past decade, with 1700 projects in 50 countries valued at $75 billion. As a non-member of the OECD’s DAC group Beijing has fought greater disclosure moves in arguing that its “South-South cooperation” differs from traditional Western money and technical flows. The difficulty of uncovering information and numbers is compounded by the “labyrinthine network” across multiple agencies and ministries responsible for policy and distribution including the State Council and Export-Import Bank. The giving history dates back decades to post-colonial independence but attention and volume have heightened the past five years. Western and local critics have often hurled charges of raw material exploitation, rogue regime support, unsustainable debt creation, and labor and environmental standard violation which do not “survive scrutiny,” the review finds. Previous annual estimates have been wide-ranging from $500 million to $18 billion in pure development funding alone while the divergence in amounts is magnified with additional forms from companies and financial institutions acting in parallel. The authors quantify these sources under a “vague” category when specific providers are not listed in press accounts. Its effort follows on recent exercises at New York University and the Inter-American Dialogue as well as the Heritage Foundation’s longstanding global investment tally which excludes development finance and sets a minimum $100 million threshold. It tries to eliminate double-counting and rely on Chinese language reporting and notes an upward trajectory since 2006 in both direct government and “unofficial” commitments, with the latter now dominating. The total peaked at $50 billion in 2010 and fell to $35 billion the next year, and comprises grants, loans, guarantees, debt relief, scholarships and training. The average official project size from 2000-10 of $120 million dwarfs the $2 million identified by the US in bilateral terms.
Oil producers Angola and Nigeria have been favorites despite lingering political and security troubles. The former plans to float a $1 billion Eurobond in the coming months after an opposition challenge to longtime President dos Santos’ 2012 election win was rejected on the grounds that only the full parliament can take action. A new mining regime reduced corporate tax and should sustain 8 percent GDP growth on the first budget deficit in five years. Inflation hovers around double-digits and a sovereign wealth fund was launched to great fanfare with the president’s son in charge. Nigeria’s is also underway with a preliminary $1 billion in assets shifted from the opaque excess crude account, as indigenous operators including the big listed Dangote Group look to enter the industry under recent liberalization. The stock market is a top MSCI frontier performer despite steeper P/E ratios at 13.5, and central bank head Sanusi who has been praised for tackling sector cleanup and inflation will not seek to extend his appointment. Attacks have also worsened from the militant Boko Haram in the north as cooperation founders across the country’s religious split.
