The China Africa Research Initiative at the Johns Hopkins University has over the past week released its data concerning Chinese investment in Sub-Saharan Africa. The figures show the sum of Chinese loans to be less than commonly assumed, whilst demonstrating that the “Angola Model”, using commodities as collateral, account for only a third of the total loans.
However, since the early 2000s, Chinese loans have dramatically increased to sub-Saharan Africa. The data provided by the China Africa Research Initiative demonstrates that the Chinese financial commitment to the region has grown from $0.2 billion in 2000 to almost $17 billion in 2013. Between 2000 and 2014, ‘the Chinese government, contractors, banks and contractors extended $86.9 billion worth of loans’ to sub-Saharan Africa. Although the findings grab the headlines, commentators argue that the figures show Chinese investment in Africa is actually far less than commonly reported.
The research, based upon 1,123 reports, demonstrates that only 56% of the loans materialised and are being used, whilst the rest have either been cancelled or turned out to be mistakes. Where the loans go also makes for interesting reading. Oil-rich Angola receives by far the largest proportion of Chinese investment ($21.2 billion) and are almost exclusively based upon oil as collateral. Yet elsewhere, including the second largest benefactor Ethiopia, Chinese investments have avoided the use of commodities as collateral. Despite being resource-poor, Ethiopia has been deemed a stable investment due to political stability and a growing tertiary sector. Only a third of the investments have followed the so-called “Angola model”. Political alignment between the Chinese and the two largest recipients of the loans has gone hand in hand, with Ethiopia and Angola both following Chinese approved state-development models.
Whilst China’s investment in sub-Saharan Africa is less than previously thought, the research demonstrates that development assistance loans will continue to grow. The Export-Import Bank of China has not yet overtaken the World Bank as the largest provider of development assistance loans to Africa, it is scheduled to do so in the coming years.
An internal state document has been leaked to the press in Ghana detailing concern over possible attacks from Islamist insurgents. Security fears have increased in the country since Ghana’s neighbour, Côte d’Ivoire, was targeted by Al-Qaeda in the Islamic Maghreb (AQIM) last month.
The document reports that evidence had been passed on to the country’s National Security Council Secretariat (NSCS) showing Ghana and Togo to be the next targets in the region. The information is thought to have been extracted following the interrogation of the man suspecting of orchestrating the attacks in Côte d’Ivoire during March 2016, where 18 people were killed at a beach resort. The memo called for tightened security along the northern borders with Burkino Faso, in order to prevent militants passing through the country from Mali, the origin of the March attackers.
In recent months Al-Qaeda in the Islamic Maghreb (AQIM) has notably increased its operations, committing high profile attacks in Mali in November, as well as in Burkina Faso’s capital in January 2016. On both occasions hotels frequented by Westerners were the target. Following the attack on the Grand Bassam beach resort last month, AQIM stated that the attack was in response to French operations against Islamist militants across the Sahel region. France has played a pivotal role, particularly in Mali, in containing the spread of militias since December 2012. Yet, France’s role in Africa is not without contrasting interpretations given its previous colonial status, though its recent interventions were at the behest of the Malian government and with the backing of a UN resolution.
The Ghanian President John Mahama has warned against panic in the country following the leaked document. Ghana’s status as a leading democratic and prosperous African state is not threatened to any great extent, and the country has not had any experience of Islamist attacks in the past. Intelligence sharing in the region is underway in order to tackle the threat. More is needed on the behalf of the Africa Union to combat terror and tackle instability, especially in northern Mali, where AQIM has been able to operate freely. The transnational mobility of AQIM, to which borders do not represent any serious barrier, requires intelligence sharing and joint operations similar to those seen in Europe.
The temptation in the age of global terrorism is to join the dots between the various Islamist groups operating across the Sahel and into the Middle East. AQIM is reportedly linked to Al-Qaeda in the Arabian Peninsula (AQAP), which was established in 2009 through a merger of the Yemeni and Saudi branches of al-Qaeda. Yet communications and links between groups is at best questionable. In reality, these organisations are operating in regional isolation, without the support of a joined up network. We must not simplify Islamist threats by banding together often extremely different branches of terrorist networks, which each have their different identities, causes and explanations.
U.S. Secretary of State meets with President Buhari at Washington D.C. Nuclear Security Summit. Source: Wikimedia Commons
In Abuja this week, the U.S. Embassy announced a proposed increase in development aid to Africa’s largest economy to 600 million dollars over the course of 2016. The agreement is set to be part of a broader strengthening of relations between the two countries, as Nigeria continues its battle against Boko Haram with the support of the U.S.
The announcement followed successful bilateral meetings between Secretary of State John Kerry and President Buhari during the nuclear security summit in Washington D.C. Kerry was reportedly impressed with the actions of the Buhari government since coming to power in May 2015. The diversification of the Nigerian economy, top of Kerry’s list of priorities for economic development, has meant departing from an over reliance upon oil for export earnings. Washington has also been impressed by the president’s commitment to fighting the Boko Haram insurgency.
The U.S. already has several schemes in place to support development in Nigeria, including the U.S. Power Africa project. The programme initiated by the Obama administration has aimed to increase sub-Saharan African energy production by 30,000 Megawatts from new clean sources of power. In Nigeria alone, 6,504 Megawatts have been generated. Education has also been high on the agenda, with development aid contributing towards schooling programmes to increase literacy, especially in the north of the country where Boko Haram has mainly operated.
U.S. assistance to tackle Boko Haram will remain conditional, with government transparency, continued economic development and enhanced business conditions all desired. John Kerry also emphasised the importance of adhering to internal human rights laws in the fight against insurgency. Under Buhari’s predecessor, Goodluck Johnathan, U.S. assistance for the Nigerian military came to a halt following claims of corruption and human rights abuses by the army. Johnathan’s failure to investigate these claims was met with criticism from the U.S. and his decision to cancel U.S. Army training of the Nigerian military for combat against Boko Haram. Since coming to power President Buhari has hoped to regain U.S. support.
The latest economic agreements between Washington and Abuja have been seen as part of the broader strengthening of relations between the two countries following the departure of Goodluck Johnathan. Economic development in Nigeria, particularly in the northeast of the country, is to be one of the many components needed to tackle the Boko Haram insurgency.