Africa keen for more Chinese development finance, despite economically bumpy road towards FOCAC summit
- Concessional development finance, infrastructure and trade have been discussed at a retreat held to set the agenda for September’s FOCAC
- Held every three years, the Forum on China-Africa Cooperation is traditionally where big financial commitments are made by China for Africa
On April 23-24, 42 diplomats from 29 embassies, including 20 African ambassadors in China, met at a retreat in Beijing to work on setting the FOCAC agenda. The retreat was jointly organised by Beijing-based consultancy Development Reimagined and the African Union representative office in China.
After two days of African-only talks, the ambassadors were joined by Chinese diplomats, including Wu Peng, the Chinese foreign ministry’s director general of African affairs.
Wu also advocated for African-led initiatives at the meeting, as well as showing a readiness to understand the continent’s development needs.
Representatives from the China-Africa Development Fund, China-Africa Business Council, Chinese Academy of International Trade and Economic Cooperation, and the Centre for International Knowledge on Development took part in the retreat.
Jing Cai, Africa-China cooperation programme manager at Development Reimagined, said the meeting also aimed to “articulate needs for support for the work of African ambassadors and diplomats in China, with concrete action items to take forward for the preparation of FOCAC 9 in 2024”.
FOCAC is the most important mechanism for engagement between China and the African continent. It is also traditionally the forum where big financial commitments are made by China.
Africa’s importance to Beijing is not just economic – politically, most countries in the continent vote on international issues in alignment with China.
Despite the possible barriers, a Development Reimagined statement expressed optimism about this year’s FOCAC.
“Since Africa’s development needs remain significant, especially in infrastructure, we anticipate that Chinese lending will likely rebound to pre-pandemic levels,” it said.
Ambassador Lynette Mwende Ndile, Kenya’s deputy head of mission to China, wrote on X about the retreat, saying the road to FOCAC 9 had begun. The retreat, she said, helped with “agenda setting for more deliberate collaboration and partnerships in our Africa-China strategic cooperation”.
But with several months yet until September’s summit, African governments are still deliberating about what they want to be discussed, according to Development Reimagined chief executive Hannah Ryder.
“In the retreat, it was also clear that global governance reform and manufacturing – including … pharmaceuticals and other medical products as well the green transition – will no doubt be key areas African countries are looking to engage China on.”
Sub-Saharan geoeconomic analyst Aly-Khan Satchu said the importance of FOCAC could not be underestimated.
“The FOCAC summit remains for me the seminal and most consequential Africa-China meeting,” he said.
David Shinn, a China-Africa specialist and professor at George Washington University’s Elliott School of International Affairs, said Chinese lending was unlikely to ever again reach the 2016 peak of US$28 billion. He said over the past three years, Chinese loans had sat at around US$1 billion annually.
Part of the reason is also that China has already completed so many infrastructure projects in Africa – so there are not as many left to do.
“There are fewer large, economically viable infrastructure projects to finance in Africa. China is experiencing some challenging economic issues that will likely cause it to be more restrained in offering large infrastructure loans,” he said.
Meanwhile, Shinn said, China would try to replace large loans with more foreign direct investment, much of which may be directed towards the agricultural sector. He said food security was a major internal goal for China; Beijing was anxious to increase sources of food supply from around the world, including Africa.
“China has been working for many years to increase trade with Africa. The September FOCAC meeting will almost certainly include another effort to do so,” he said.
Shinn added that China, Africa’s largest trading partner since 2009, has had far more success increasing its exports to Africa than it has had increasing African exports to China.
“Since 2012, Africa has had a trade deficit with China. African oil exports to China dropped substantially in 2023. If this trend continues, Africa’s trade deficit with China will likely increase,” he said.