By Austin Maho (Ph.D)
This October is a major landmark in the growing Sino-Africa relationship. October 2020 is significant because it marks the 20th anniversary of the Forum on China-Africa Cooperation (FOCAC) which has grown to become one of the world’s most visible and effective multilateral platforms for international collaboration and development.
FOCAC’s 20th anniversary is coming on the heels of the outbreak of the Covid-19 global pandemic. Covid 19 has infected millions and killed hundreds of thousands. The disease has challenged global health and relationship. It has exposed global fault lines and has laid bare the hypocrisy of nations. At a time the world should have embraced multilateralism and solidarity some countries have fallen short of expectation. Unilateralism has become a counterforce to multilateralism.
FOCAC has come to represents the new world order for multilateralism and cooperation. In twenty years it has become the rallying point for developing countries and South-South cooperation. It represents a shift in Western-backed global institutions that have only served the interests of big powers.
Twenty years after, FOCAC has grown exponentially and presently comprises of 54 African countries, the African Union Commission and China as main financial and catalyst for its operation, it has become a global institution of reckon giving voice to African countries in the global community.
The Forum was founded in the year 2000 in Beijing with many African heads of state in attendance. The forum holds it gathering every three years and has since inception held 7 ministerial conferences so far alternating between Beijing and African countries. Beijing hosted the maiden edition in 2000 while the city has also played host to the conference in 2006 and 2012 and 2018. Addis Ababa 2003, Egypt 2009 and South Africa 2015.
The Forum held it 7th ministerial conference on September 2, 2018, at the Diaoyutai State Guesthouse in Beijing.
Why FOCAC Became Necessary
While economic globalization has provided new opportunities for China-Africa cooperation,
Reforms and opening up in china and the consequent exponential economic growth of China
Increasing presence of Chinese enterprises in Africa
Increasing Chinese funded projects and aid to Africa countries
Centuries old relationship with the West has yielded little in terms of concrete and visible development for African countries.
In October 1999, President Jiang Zemin wrote to 44 leaders of African countries with which China had diplomatic relations and invited their foreign ministers or ministerial officials in charge of international cooperation or economic affairs to the conference. He also extended invitations to the heads of state of the OAU’s previous, current, and future presidency (Algeria, Togo and Zambia) to attend the opening ceremony.
These efforts led to the first FOCAC meeting in 2000.
As noted by State Councilor and Foreign Minister Wang Yi at the September 2018 meeting, FOCAC has become an important mechanism for collective dialogue and practical cooperation between China and African countries, a model of South-South cooperation and a banner of international cooperation between China and Africa.
China’s engagement with Africa is based on mutual benefit and respect. President Xi Jinping at the FOCAC Beijing Summit in 2018 captured the rules of engagement succinctly.
“We respect Africa, love Africa and support Africa. We follow a “five-no” approach in our relations with Africa:
No interference in African countries’ pursuit of development paths that fit their national conditions;
No interference in African countries’ internal affairs;
No imposition of our will on African countries;
No attachment of political strings to assistance to Africa; and
No seeking of selfish political gains in investment and financing cooperation with Africa.”——President Xi Jinping on FOCAC Beijing Summit 2018
Over the years the Chinese government has adhered to these rules of engagement in its relationship with Africa.
The goals of FOCAC can be summarised as follows:
Create new paths for South-South cooperation and generate specific results
Should be based on tangible result and follow up activities
To focus on development trade and economic activities
Human resources and capacity building.
FOCAC in 20 years has recorded remarkable achievements across Africa and specifically in Nigeria. Achievements have been recorded in the areas of debt forgiveness, human resources development, agriculture, concessionary loans, infrastructural development, increase imports and trade, technological transfer, investment expansion in Africa by Chinese companies, construction of the AU headquarters, Covid-19 intervention among others.
It would be helpful to examine these achievements as it has impacted the African continent and thereafter narrowing it to Nigeria.
Africa
Debt relief for poor African countries. At multiple conferences, China has relieved the outstanding debts in the form of interest-free Chinese government loans incurred by the heavily indebted and poor countries and the least developed countries in Africa.
The first FOCAC conference declared the exemption of RMB10 billion worth of debts for relevant African countries. The 2006 Beijing summit, the 2009 Egypt conference, the 2015 Johannesburg summit, and most recently the 2018 Beijing summit respectively gave debt forgiveness and interest-free loans as a way of building trust and goodwill and lessening the financial burdens of poor African countries.
Infrastructural development. China has built more than 6,000 kilometers of railways and roads in Africa, nearly 20 ports more than 80 large power plants.
Human resource development. China has enhanced Africa’s ability for independent development. Trained more than 200,000 talents of all kinds in Africa. promoted the process of industrialization.
Trade and investment. The volume of trade between China and Africa exceeded US$200 billion in 2019, and China has become Africa’s largest trading partner for 11 years in a row. China’s stock of indirect investment has reached US$110 billion More than 3,700 Chinese enterprises have invested and started businesses in various parts of Africa, providing a strong driving force for sustained economic growth in Africa. Driven by China-Africa cooperation, other foreign countries have also increased their attention to Africa, bringing more opportunities for Africa’s development. Statistically, China has traded with Africa more than any other country in the World. 20 years have recorded remarkable wins for both China and Africa under the FOCAC platform. Chinese companies in Africa have become major employers of labour in the continent and have provided capital and technologies for industrial growth.
Nigeria
Nigeria has been a major beneficiary of this relationship under the FOCAC platform, China has proved to be a reliable partner. As of 2019, the bilateral trade volume between China and Nigeria increased steadily by 26.3% year-on-year.
In terms of infrastructure, Nigeria has seen a harvest of infrastructural A number of Chinese funded projects have been successfully completed. Major ones are the 187 km Abuja-Kaduna standard gauge railway line which was commissioned in 2016. The 315 km Lagos-Ibadan railway line which is set for commissioning in January, Itakpe-Warri commissioned last month after 46 years.
There is also the Abuja urban light rail project which was commissioned in 2018. The Abuja metro light rail line is the first of its kind in West Africa.
The four airport projects in Abuja, Portharcourt, Kano, Enugu of which Abuja now have brand new airport terminals
Zungeru Hydropower Plant
Abuja Keffi-Lafia Makurdi Road
Lekki Deep sea port
Ogun Guangdong Free Trade Zone
Lekki free trade zone
Nigeria needs manufacturing and industrial development and expectedly should cooperate to boost the industrial development of Nigeria, for more economic sustainability, diversification more job creation. localization of Chinese companies in Nigeria and promoting the initiative of “Made in Nigeria with China”to achieve Nigeria’s high-quality development.
These efforts and successes in China Nigeria relationship through the platform of FOCAC continue to draw accolades. The bulk of the infrastructural projects on-going in the country today are Chinese funded.
President Buhari recognises this much. Last years while receiving in audience the chairman of China Railway Construction Corporation Limited was full of praise for the contribution of China to the infrastructural development of Nigeria, he expressed happiness over the genuine efforts of China to improve Nigeria’s infrastructure. “We are very grateful to China for the effort to rebuild our infrastructure and bringing technical expertise to the country. We will give the required support and cooperation, so that our old, our out of date and collapsed infrastructure might be turned around”
These projects and many others which are still under construction signify the growing friendship between Nigeria and China.
COVID-19 intervention
The cooperation between China and Africa through FOCAC has been of great benefit to African nations, significantly it has strengthened the two sides in the fight against COVID-19.
Through the instrumentality of FOCAC, China has been able to send lifesaving medical supplies to many African countries and China has also renewed its commitment to expedite the completion of the African CDC within the shortest possible time and has also made a commitment to making a Chinese made Covid-19 a global goods to be available to African countries.
In all the countries were vaccine development have reached an advance stage of trial only China has given assurances that a Chinese developed vaccine would be declared a global public good, thereby making it immediately available to all countries and people of the world especially, African countries.
At the June 17, Chinese President Xi gave a keynote speech at the Extraordinary China-Africa Summit on Solidarity against COVID-19. He assured African nations of the assistance and support of China in the battle against COVID-19. President Muhammadu Buhari along with Presidents of other African countries attended the virtual meeting. The Summit issued a joint statement which reflects the common position of China and Africa on a series of major issues, and reached extensive consensus on supporting Africa’s COVID-19 response and strengthening China-Africa and international cooperation against the virus.
Chinese President Xi Jinping was very clear about this at the 73 section of the World Health Assembly and Africa China Summit on COVID-19 earlier in June this year. In both event, he had called for building a global community of health for all and also announced measures to boost the global fight against COVID-19.
“We must provide greater support for Africa. Developing countries, African countries, in particular, have weaker public health systems. Helping them build capacity must be our top priority in COVID-19 response. The world needs to provide more material, technological and personnel support for African countries” He said during the 73 section of the World Health Assembly.
China has provided humanitarian assistance to Nigeria to combat or cushion the effect of Covid -19 in the spirit of Nigeria-China brotherhood..
As of the end of July, 3 batches of governmental medical supplies have been donated to the Nigerian government. China’s provincial and city governments are rushing to help their sister states and cities in Nigeria too. With the assistance of the Consulate General of China in Lagos, the Chinese Community and Chinese companies in Nigeria have donated 5 batches of medical supplies as well as cash to the local communities. We are also proud to witness that more and more Chinese communities in Nigeria are also showing their support voluntarily with generous financial and material donations to their local hospitals and neighborhoods.
However there have been drawbacks to FOCAC especially in the following areas:
Third party interference and negative propaganda especially by Western politicians and media; internal conflicts and contradictions rocking many African nations; political instabilities rocking several nations; endemic corruption; the fragile nature of most affrcian nation and the debt burden.
The issue of debt burden or debt diplomacy is the most contentious as several western commentators seek to discredit FOCAC on the bases that it is designed to lure African countries into a new round of debt trap. However available evidence is to the contrary.
China is accused of luring developing or underdeveloped countries in Africa to borrow money for infrastructure projects and later controlling them if they fail to pay off their loans in time thereby using strategic debt to gain political leverage.
While this argument has gained significant global traction there is however no hard fact to back up the claim what we have are evidences to the contrary.
Several independent organisations have weight in on the argument and made their report public. Two prominent ones are the New York based Rhodium Group and the Johns Hopkins University based School of International Studies otherwise known as: SAIS-CARI, project that is the China Africa Research Initiative (CARI) at the Johns Hopkins University School of Advanced International Studies (SAIS) is a research program dedicated to understanding the political and economic aspects of China-Africa relations.
The reports note that “Chinese loans are not currently a major contributor to debt distress in Africa but loans from Bretton woods institutions and Western nations.
SAIS-CARI or the China Africa Research Initiative (CARI) at the Johns Hopkins University School of Advanced International Studies (SAIS) is a research program dedicated to understanding the political and economic aspects of China-Africa relations.
Australian National University senior lecturer Darren Lim said the “debt trap diplomacy” claim was never credible, and had been pushed by the Trump Administration.
“It beggared belief that Beijing was deliberately setting up recipient countries to fail,” he said. He also said much of China’s lending has been to high-risk countries with poor credit ratings “but once the money is in, much of the leverage shifts to the borrower”.
In other words giving loans to developing countries is high Risk! Western countries and institutions are no longer willing to take the risk only China in recent years is willing to lend money to developing countries.
Also an analysis by New York’s Rhodium Group of 40 debt renegotiations made by China across 24 countries found “asset seizures are a very rare occurrence”.
Instead, the report found “debt renegotiations usually involve a more balanced outcome between lender and borrower, ranging from extensions of loan terms and repayment deadlines to explicit refinancing, or partial or even total debt forgiveness.”
Where there was a change of government leadership in a country, Beijing was “often compelled to agree to term renegotiations, usually to borrowing countries’ advantage”, the report found.
Nigeria in Perspective
In Nigeria, Chinese loans constitute about 10% of total debt according to data from the Debt Management Office (DMO). Nigeria’s indebtedness to China as at June 2020 amounts to a total of $3.121bn constituting 3.94% of our total external debt stock of $79.3 bn.
These loans have not gone into consumption but have been deployed into infrastructure. Most of the loans were secured as counterpart funding for key infrastructural projects spread across the country.
Examples are the Abuja Kaduna standard Gauge Railway line, the Lagos Ibadan standard Guage railway line which will continue to Kano, the coastal line, Calabar, PH, Lagos, the 4 airport project, Abuja Makurdi dualisation and a host of others.
These projects falls under China’s Belt and Road Initiative, whose main thrust is to provide loans for infrastructural development especially, roads, rails and bridges. The philosophy behind the BRI is that connectivity creates wealth hence the investment in infrastructure that connects people.
Can we in all honesty question government decision to complete the Abuja Kaduna railway, Ajaokuta Warri, Lagos-Ibadan or the Abuja Makurdi road dualisation?
What the Future Hold
First, both China and Nigeria boast a huge market, so there is a tremendous potential for bilateral trade. China should encourage its businesses to export mechanical and electrical products as well as consumer goods with high quality and at proper prices to Nigeria, and import more advantageous Nigerian products so as to optimize bilateral trade structure.
Second, Manufacturing value added products should be prioritized to enhance competitiveness to achieve a step by step economic modernisation and development.
Nigeria’s huge consumer market and rich demography offers limitless possibilities through human capital development. More joint economic zones can be created following the hugely successful OGFTZ which currently has over 30 companies, FDI of 2 billion USD and 6,000 direct employment.
Nigeria should also leverage on the FOCAC platform to encourage more Chinese firms to invest in Nigeria while government should create the enabling environment beyond words of mouth.
Additionally, through the FOCAC platform Nigeria should harness its agricultural potentials. Agricultural development food processing, cassava, oil palm, rubber, cocoa and build industrial clusters around processing and value addition to primary agricultural products.
Conclusion
Irrespective of western fuelled criticism, Sino-Africa relationship has been mutually beneficial, it has been a relationship built on trust and understanding. The insinuation in Western quarters that China is pushing African nations into a debt trap is simply ridiculous and designed to sow the seeds of doubt into a blossoming partnership and brotherhood.
As FOCAC celebrates its 20th anniversary, the results of the platform can be seen across Africa. Over the past two decades, FOCAC has become an important platform for collective dialogue and an effective mechanism for practical cooperation between China and Africa, despite the challenges of a fast-changing global landscape China-Africa partnership is matching ahead full throttle.
FOCAC 20 years on has become the vehicle of China Africa relationship encompassing several areas of cooperation.
Coupled with the Belt and Road Initiative (BRI) the future is bright. China through the instrumentality of the BRI continues to commit funds for the construction of essential intra- and inter-continental connectivity for a new Africa that is better linked, trade better and has a stronger voice in the international community.
As the world slides into unilateralism and ultra-nationalism, FOCAC is the hope, the voice and benchmark for global multilateralism a win-win for China Africa cooperation.
Being a paper delivered at the Round Table Dialogue Of The “Forum On China Africa Cooperation (Focac) At 20 Years: Achievements and Prospects at the China Cultural Centre, November 3, 2020.
