Monday, July 01, 2019

China and America scamble for Africa

Last week, the 12th US-Africa Business Summit, a high-level event attended by 11 African heads of state and government and some 1,000 business leaders, was held in Maputo, Mozambique. During the three-day event, US officials unveiled a $60bn investment agency which will seek to invest in low and middle-income countries, with a special focus on Africa.

 National Security Advisor John Bolton presented the Trump administration's "New Africa Strategy": 
"Great power competitors, namely China and Russia, are rapidly expanding their financial and political influence across Africa. They are deliberately and aggressively targeting their investments in the region to gain a competitive advantage over the United States."

It already appears that Africa is set to become yet another battleground for the escalating trade war between China and America. Africa is already witnessing the first signs of an emerging new cold war. And just like the previous one devastated Africa, fuelling wars and forcing African governments to make economic choices not in their best interests, this one will also be detrimental to African development and peace.

Chinese trade with Africa has increased 40-fold over the past two decades; in 2017, it stood at $140bn. Between 2003 and 2017, Chinese foreign direction investment (FDI) flows have also jumped more close to 60-fold to $4bn a year; FDI stocks stand at $43bn - a significant part of which has gone to infrastructure and energy projects.

China has significantly expanded African railways, investing in various projects in Kenya, Ethiopia, Djibouti, Angola and Nigeria; it is currently building a massive hydropower plant in Angola and have built Africa's longest railway connecting Ethiopia and Djibouti.
In contrast, for a long time the US has viewed Africa as a battlefield where it confronts its enemies, whether the Soviets during the Cold War, terrorists after 9/11 . Washington has never really made a concerted effort to develop its economic relations with the continent. Trade between the US and Africa has decreased from $120bn in 2012 to just over $50bn today. US FDI flows have also slumped from $9.4bn in 2009 to around $330m in 2017. The new $60bn investment fund announced last week is a welcome initiative from the US but it will not be able to challenge Chinese economic presence on the continent. 
The USA  accuses China of using "debt to hold states in Africa captive to its wishes and demands" and has warned African states to avoid Chinese "debt diplomacy" which is supposedly incompatible with the independence of African nations and civil society and poses "a significant threat to US national security interests". Yet, Africa is only the fourth-biggest recipient of Chinese FDI after Europe (mainly Germany, UK and Netherlands), the Americas (mainly the US and Canada), and Asia. The US has also borrowed heavily from China; currently its debt to its rival stands at $1.12 trillion. By contrast, Africa owes China around $83bn.
Africans are fully aware of and concerned about high indebtedness, trade imbalances, the relatively poor quality of Chinese goods and services and Beijing's application of lower standards of labour and environmental practices. But many do not share the American perspective that their economic relationship with China is to their detriment and rather see it as an opportunity that provides much-needed unconditional funding and that takes into account local priorities. As Djibouti's President Ismail Omar Guelleh has pointed out, "The reality is that no one but the Chinese offers a long-term partnership." The pressure the US is currently exerting on African countries to move away from partnerships with China could hurt African economies. It could force African countries into making choices that are not in their best economic interests and miss out on important development projects or funding.

The escalating tensions between the US and China could also end up threatening the security of the continent. Both countries are militarily involved in Africa. 

Over the past 15 years, the Chinese People's Liberation Army has been engaged in a number of security missions across the continent, making modest auxiliary troop contributions to peacekeeping operations in Sudan, South Sudan, Liberia, Mali and the Democratic Republic of Congo. It has also contributed millions of dollars of peacekeeping equipment to the African Union Mission in Somalia and provided significant funding to the Intergovernmental Authority on Development for its mediation in South Sudan. In 2017, the first Chinese overseas military base was opened in Djibouti officially supposed to provide support for the ongoing anti-piracy operations of the Chinese navy, yet the facility has the capacity to accommodate 10,000 troops.
China's military presence in Africa, however, pales in comparison to that of the US. Over the past few years, US Africa Command has run some 36 different military operations in 13 African countries, including Burkina Faso, Cameroon, Central African Republic, Chad, Democratic Republic of Congo, Kenya, Libya, Mali, Mauritania, Niger, Somalia, South Sudan and Tunisia. It has more than 7,000 troops deployed on the continent. It has a large base in Djibouti - the biggest and only permanent US military base in Africa - but it also runs at least 34 other military outposts scattered across the west, east and north of the continent where US troops are deployed and military operations (including drone attacks) are launched from. The US also directly supports the armies of Egypt, Nigeria, Ethiopia, Mali, Niger and others as well as the G5 Sahel force tasked with counterterrorism.
The fallout of the US-Chinese competition is particularly apparent in the strategic Red Sea region, through which passes one of the most important maritime routes. Countries in the region are not only feeling growing US and Chinese pressure to take one side or the other. 
Djibouti has recently found itself at the centre of US-Chinese diplomatic confrontation. Being a host to military bases of both superpowers, the small countries have had to play a difficult balancing game. In 2018, Djibouti seized control of its Doraleh Container Terminal from the Emirati company DP World, claiming its operation of the facility was threatening its sovereignty. The Djibouti authorities had feared that the UAE's investment in the nearby Port of Berbera in the autonomous Somali region of Somaliland could challenge its position as the main maritime hub for Ethiopia's large economy. Its decision to terminate the contract with DP World, however, triggered a sharp reaction from Washington, a close Emirati ally. The Trump administration fears that Djibouti could hand over control of the terminal to China. 
Bolton warned: "Should this occur, the balance of power in the Horn of Africa - astride major arteries of maritime trade between Europe, the Middle East, and South Asia - would shift in favour of China. And, our US military personnel at Camp Lemonnier could face even further challenges in their efforts to protect the American people."
Djibouti was forced to declare publicly that it would not allow China to take over the terminal but that has not eased US fears. Ever since, the US sought to secure a possible alternative location for its African military base: neighbouring Eritrea. It encouraged regional actors, including Saudi Arabia and the UAE, to pull Eritrea out of its decades-long isolation. In a matter of months, long-time enemies Ethiopia and Eritrea concluded a peace agreement to end their 20-year-old cold conflict, while the UN lifted sanctions on Asmara. As a result, Eritrea could emerge as a strategic rival to Djibouti, offering its coast for foreign military and economic facilities. The UAE, for example, has already set up a military base near the port of Assab.
Sudan has also been the battleground of the ongoing superpower turf war. Sudan in fact became the biggest beneficiary of the $60bn Africa investment package China pledged in 2018, having some $10bn in Chinese debt written off. The Chinese government also made a lot of plans to develop facilities in Port Sudan.
Meanwhile,  al-Bashir's removal was approved in Washington, which has since appeared to back the interests of Saudi Arabia and the UAE in the country. The two Gulf states currently hope to install another strongman sympathetic to their regional politics, who would maintain Sudan's participation in the war in Yemen and curb Turkish and Qatari influence. At this point, it seems China is at risk of being sidelined by the significant sway the UAE and Saudi Arabia have with Sudan's Transitional Military Council (TMC).
To  preserve its interests and its peace, Africa has only one option: to reject pressures to swear allegiance to either of the two powers.

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