Chinese President Xi Jinping on Thursday pledged 360 billion yuan ($50 billion) in financial aid to African countries over the next three years. In addition, Beijing will open its markets to 33 least developed countries in Africa, which will have access to all Chinese products at zero tariffs.
Speaking at the Forum on China-Africa Cooperation in Beijing, Xi made a series of commitments covering trade, industrial supply chains, infrastructure connectivity, health, people-to-people exchanges and security.
Leaders and representatives from more than 50 African countries are attending the forum, which has been described as Beijing’s biggest diplomatic event in recent years and is held every three years.
Leaders will discuss infrastructure projects, climate change, the new energy economy, security and peace, and Africa’s credit problems.
“After nearly 70 years of hard work, China-Africa relations are now enjoying the best period in history,” Xi said in his opening speech to delegations from more than 50 African countries attending the meeting, which has been held every three years since 2000 and alternates between China and an African host.
With the African Union’s Agenda 2063 development plan reflecting China’s long-term development path, Xi said the two sides’ approach “will definitely lead the modernisation trend in the global south”.
Of the 360 billion yuan in financing, 210 billion yuan will be in the form of loans, while the rest will be provided through various forms of assistance, including 70 billion yuan to promote investment by Chinese companies in Africa. This lending, which will average around $10 billion per year over the next three years, is similar to the annual commitments made under the Belt and Road Initiative nearly a decade ago.
According to a recent study by the Center for Global Development Policy at Boston University, Chinese lenders will provide $4.61 billion in loans to eight African countries in 2023.
China’s financial offers are welcome, as many underdeveloped countries in Africa need financing and investment to achieve their development goals, but there may be some challenges, experts say.
A lack of regulatory capacity on the African side could make it difficult to engage effectively with these actors, especially if there is a lack of coordination.
On Thursday, Xi also pledged to help African countries issue yuan-denominated bonds to boost bilateral cooperation.
In addition to loans, Xi said China would provide Africa with 1 billion yuan worth of free aid to train 6,000 military personnel and 1,000 police officers as part of Beijing’s Global Security Initiative, which includes joint military exercises.
“China is willing to help Africa improve its capacity to independently maintain peace and stability,” Xi said, adding that Africa is experiencing a ‘new dawn’ and making ‘steady progress’ on the road to modernisation.
China will offer 33 underdeveloped African countries greater market access by eliminating tariffs on unspecified products.
Other forms of assistance include the construction of vocational training facilities for 60,000 students, 30 infrastructure projects under the Belt and Road Initiative to improve land and sea connectivity, 1 billion yuan in emergency food aid, and support for the development of small and medium-sized enterprises.
China has also announced that it will help train African officials to improve governance. Beijing will set up 25 African research centres and invite 1,000 African officials and politicians to China to learn about modern governance.
