China is thinking twice about lending to Africa

6/29/2019 1:23:00 PM
China is thinking twice about lending to Africa

Too many past projects have been costly flops

African leaders are spooked at the conditions attached to Chinese debt, and the possible consequences of defaulting

Too many past projects have been costly flops

OR TENdays in May Uhuru Kenyatta, Kenya’s president, vanished from view. Kenyans feigned concern on Twitter, using the hashtag #FindPresidentUhuru. A missing-person poster appealed for information on the whereabouts of a five-foot-eight African male last seen in Beijing. A government spokeswoman sought to reassure the public: Mr Kenyatta had been in his office “meditating”. But others speculate that the president was in a funk after his trip to China failed to yield a new loan for the next phase of Kenya’s ambitious $10bn railway.

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3 business alliances indication their capital trap in china , Africa is opportunity for capital outflow from china. Really? Did you fucking see the 'external debt' charged to latinoamerican countries by IMF or world Bank? And you dare to speak about defaulting... Dominican Republic expended 50 yrs paying IMF debt only. Chinese are worth a try!

Chinese lend African debts teach them improving life, only several decades, we have had tremendous development; Before these in hundreds years, Western colonists slave African people, Rob their resources & live, only lost poverty, I'll & death. Sharia law is pretty clear that loan payers must be allowed to pay off. Allah is greater than China.

あなたは完全に理解できるように、その問題について注意深く考え抜くべき You should think about the problem out deeply with care in order to achieve complete understanding of it FYI, Africa is a continent, not a country. CyrusKublai If a white republican had typed this it would be non stop “your racist!” One would be surprised if such clever and astute Chinese had lent to Africa without serious implications if they default.

Only after you get the borrowed money you start raising concerns. How convenient. The appraisals of the Chinese projects in Africa, especially the ex ante analysis of the benefits, might not have been done properly. Supervision and monitoring during implementation, and evaluation prior to deciding on continuing the projects, might have also been deficient.

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SimumbaTrevor It will be interesting to see how this affects Zambia's economy and politics. Infrastructure was used as a way of keeping party loyalists loyal and happy. I always wondered if China was unaware of the negative name it was getting in Africa because of these debts. Chinese state financed proyects, built by chinese companies, with chinese manpower frm th bottom up, while the locals just look at, to find tht in the end all they have is something tht many a time suits th chinesea nd a huge debt tht compromises th country's for many years

Why? They always default anyway don’t they? I wouldn’t lend to them at all! smart for both not to China is making Conquest in Africa. Nice they have a great deal in Africa they've had payment already kimvie I know exactly what you😀🧡 They should be. They are consistently losing their land and rich resources to countries who rob and mistreat them. Colonizing will return if they continue. The leaders need to put their country, its citizens, infrastructure, schools, hospitals, mass transit, new housing first.

Who needs a soul anyways?

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Prince Harry and Meghan Markle's autumn tour to Africa confirmed by palace – detailsCONFIRMED: The Duke and Duchess of Sussex and their son Archie are going on their first official tour as a family of three! Temporary employment..😂😂😂😂 Nice for Prince Harry and his wife Duchess Meghan Who the crap cares about this stupid information boring I wouldn’t bring a baby on any trip!!!!! 😴😴😴

Homeowners shopping mortgages spooked by the conditions imposed by banks? Income qualifications, default-sell your house! Any dif, you owe! Chinese don’t directly take a country’s income into account to approve a loan or interest rate-it’s project viability? Collateral, Spooky Africa isn't prepared for the long game.

ChiComs don't invest internationally expecting the loans to be repaid as originally agreed. Instead, they anticipate that the loans won't be repaid in full so then they can their yuans back in more valuable natural resources and greater political influence that lingers for years. It's happening every where including in USA. Remember this 1

Suckaaaaasss China wants to set up alternate paths to bypass trump tariffs Surely it’s “Africa thinking twice before borrowing”..... The Chinese think in 100 yr increments. They r n the last 30 yrs of their 100 yr plan to take the 1st spot from the US as the 1 economy. China needs Africa to do so. The Chinese got some US government ways. Africa slip up and be Chinese slaves if they default.

Not any different from debt from western countries that attached conditions that weaken social services n destroy government institutions. China copies everything the West does. From iphones to western imperialism. That’s the strategy: lend-default-takeover.

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Perhaps “spooked” wasn’t the best word choice? So, were there any alternatives? African leaders are a bit dumb. So wong. We need to realize, Chinese money is a LOAN, not a gift. And loans have to be paid WITH interest. Chinese or IMF ThuliMadonsela3 Spooked? Do they even care? South Africa will be worst off than Zimbabwe. The political connected will live in luxury in Dubai and other countries.

ThuliMadonsela3 They didn't check before they signed? And that includes the ANC, by the way, who seem to believe Chinese money is free. Too late China's plan all along......

Meghan Markle, Prince Harry, and Archie Are Officially Visiting South Africa This FallMeghan Markle and Prince Harry's long-rumored royal tour of Africa is officially happening this fall. The Duke and Duchess of Sussex just confirmed they will be jointly visiting South Africa with their baby boy Archie.

I'm tired of Africa. Tired of being African. Sell it I don't care. Less Africa = less human suffering. And the other shoe dropped No crap. They should have read before they signed and took the side bribe. Are they just realizing that “free” money isn’t free? Chinese are going to make soup out of them They can default on payment together at the same time,the law can’t be forced when everyone is an offender

China will control Africa through its ports. What were their alternatives? Before this they claimed euope or US exploited them. I bet your owners the Rothschild's are pretty dang spooked right about now Sovereignty will be Lost. Africa will be chinese overseas colony

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Good for China, USA economy is so great compared to every country in the world. Thank God, President Trump was elected , can only imagine America looking like Nancy Pelosi , Maxine Waters districts. A over State Tax & Regulations, forced on the rest of America, causing poverty. Belt & Road concept & cheque book diplomacy followed by coercive asset grabbing,nurturing two vicious & duplicitous proxies like NKorea & Pakistan which r financial black holes,huge domestic debts & Donald Trump, Chinese system runs on Top down wisdom & bottom up accountability

A political investment doesn't need cash revenues. The same kind of people enslaved Aftica are now pointing fingers at China. The only reason they are saying what they are saying now is because they can not make decisions for Africa no more. China whose symbol is adragon is least understood.African leaders streached their hands for atango not knowing what they were dealing with.

But China is colonizing the continent. Can’t stop now. liangweihan4 bn cost China $1bn in losses JimWatsonOttawa says that’s nothing Sad they only realiased that now. I thought they going to own Djibouti now.😀😁😂😃😃 Africa must rise above donations and concessional funding. It is time to embrace the AFRICA market and have home led growth through efficient Intra-Africa trade. The African Union, regional trading blocks & countries need to sing from same hymn book. ValueAddition is key

Meghan Markle, Prince Harry, and Archie Are Officially Visiting South Africa This Fall

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liangweihan4 Mmm Perhaps China wants to 'rip' Africa off through fine print in investment contracts. But Africa eventually learns through repeated mistakes. How has such a rich continent become so poor? RamliRizal Do you know about this mr pres jokowi They lent to corrupt officials with lax follow up on how the money was implemented. Most of the time, Chinese contracted executed work funded by Chinese loans and paid Chinese laborers to do them. It’s a form of China giving jobs to China with Africa paying the interest.

Unless Africa can back up the loan with a chunk of real estate ie. Land as a default payment as collateral on the loans China should forget it ! How many depts has the world Had to wipe out for Africa because of defaults ? Alaska was sold by the Russians for cash to the USA ! I really hope the African leaders are worried about the conditions attached to Chinese debt and not just hoping they can pass it on to future leaders.

A must watch...

F OR TEN days in May Uhuru Kenyatta, Kenya’s president, vanished from view.DOMINIC LIPINSKI Getty Images Meghan Markle and Prince Harry's long-rumored royal tour of Africa is officially happening this fall.The couple will bring Archie on his first tour June 27, 2019 - 16:25 BST Ainhoa Barcelona The Duke and Duchess of Sussex are set to undertake an official visit to South Africa this autumn at the request of the Foreign and Commonwealth Office, Buckingham Palace confirmed on Thursday.album and the 50th anniversary of Woodstock.

Kenyans feigned concern on Twitter, using the hashtag #FindPresidentUhuru. A missing-person poster appealed for information on the whereabouts of a five-foot-eight African male last seen in Beijing. Harry will also visit Malawi, Angola, and Botswana. A government spokeswoman sought to reassure the public: Mr Kenyatta had been in his office “meditating”. It's not known when exactly Harry and Meghan will travel abroad, but previous reports have claimed the couple will go on tour in October for two weeks. But others speculate that the president was in a funk after his trip to China failed to yield a new loan for the next phase of Kenya’s ambitious $10bn railway. "The Foreign and Commonwealth Office have requested a visit to South Africa 🇿🇦 as well as The Duke carrying out visits to Malawi 🇲🇼 and Angola 🇦🇴. Mr Kenyatta could be forgiven for feeling piqued. “I knew I needed spiritual discipline, so I disciplined myself from ’72 to ’81,” he says.

Beijing’s largesse to Africa has sometimes seemed limitless (see chart). The Duke and Duchess are really looking forward to meeting so many of you on the ground and continuing to raise awareness of the high impact work local communities are doing across the commonwealth and beyond. This will be their first official tour as a family!" The couple are expected to travel with Archie Earlier this week, the British High Commissioner to South Africa, Nigel Casey, who is the government's most senior diplomat in the country, confirmed that Harry and Meghan would be paying a visit to the country. In September China promised another $60bn in aid and loans to the continent. Xi Jinping, its president, promised the money would come with “no political strings attached”. John Magufuli, Tanzania’s strongman president, was delighted." The royals went on tour to Australasia last year MORE: See the best photos of royals at Wimbledon It's believed the Duke will stop in Malawi to check in with his charity Sentebale, while in Angola, he will learn more about landmine-clearing efforts, a cause Harry's mum Diana, Princess of Wales was passionate about. The West, he griped, made its money dependent on “strange conditions”, such as insisting that Tanzania should not lock up gay men. He picked 11 of those tracks for Africa Speaks , brought in the Spanish vocalist Buika to sing on them (British artist Laura Mvula also sings on the record) and put the finishing touches on his love letter to the continent he calls “the cradle of civilization.

“China is a true friend,” he enthused. Its assistance comes “free of charge”. More on:. Get our daily newsletter Upgrade your inbox and get our Daily Dispatch and Editor's Picks. Being chummy with China has served Tanzania well. It has received more than $2bn in loans since 2010, reckons the China-Africa Research Initiative at Johns Hopkins University. How did it come together? In 1988, I was on a tour in Europe, and I used to go religiously to the Virgin Megastore in Paris and just buy everything that has to do with what I consider to be really good African music.

In 2013 China agreed to finance and build a $10bn port in Bagamoyo, once a big slave- and ivory-trading entrepôt but now a sleepy fishing village. Kenya has done even better. It was an early African member of the Belt and Road Initiative, China’s global infrastructure project. It scooped up at least $9.8bn between 2006 and 2017, making it Africa’s third-largest recipient of Chinese loans.” When it came down to recording this record … CD … 8-track … whatever it’s called now, with Rick Rubin, Buika, and my wife Cindy, we selected close to 50 songs.

Mr Kenyatta must have reckoned that his railway project, on which he has staked much political capital, was due another cut of Mr Xi’s cash. Not only has it been one of China’s highest-profile projects in Africa, but Beijing has already doled out $4.7bn to finance its first two sections. An almost 500km stretch between the port of Mombasa and the capital, Nairobi, is up and running. The second is nearly completed. Once I get that, we’ll start the song and then you tell us, ‘Here comes the bridge or the chorus.

Kenya had assumed that China would fork out the $3.5bn needed for the penultimate section, to Kisumu on Lake Victoria. If China’s ultimate vision was a railway network connecting resource-rich inland states to Indian Ocean ports, why stop funding the project halfway through? Some Africans suspect that China deliberately lends countries more than they can repay in order to seize strategic assets when they default. They point to the Chinese-financed port at Hambantota in Sri Lanka. After the project flopped commercially, a Chinese state-owned firm took control. With all of the songs, it’s no different than what Jimi Hendrix did to [Bob Dylan’s] “All Along the Watchtower.

Hambantota would be a handy place to park Chinese naval vessels seeking to patrol the Indian Ocean. “The situation that Sri Lanka got itself into may not turn out to be unusual,” says Mutula Kilonzo, a prominent Kenyan senator. “It is going to happen to African countries, too. The conditions of many loans are.. I think the tone in my guitar at first scared me because it sounded so piercing like sharp claws and teeth with ferociousness.

.a debt trap.” Deborah Brautigam at Johns Hopkins argues that Hambantota is an exception. She looked at more than 3,000 projects overseas financed by China, and found that it was the only example of such an asset being seized to cover a debt. Nonetheless, African leaders are spooked. Buika sings on all but one of the songs.

Dialogue with the Chinese is becoming edgier. On June 7th Mr Magufuli indefinitely suspended construction at Bagamoyo, balking at demands from the project’s Chinese partner for a 99-year lease and a ban on port development elsewhere in Tanzania. Moving smoothly from cheerleader to critic, he accused the firm of setting “tough conditions that can only be accepted by mad people”. Last year Sierra Leone scrapped a Chinese-funded project to build a new international airport for fear that it would involve too much debt. The perception of a plot to turn the Indian Ocean into a Chinese lake endangers the political capital China has amassed in Africa. I liked that she had the same raw realness of Tina Turner, Nina Simone, and Etta James, but she don’t sound like them.

Since Mr Kenyatta came to power in 2013, public debt has nearly tripled. Last year the IMF raised the country’s risk of debt distress from low to moderate. If Kenya defaults, China risks being blamed. China’s hesitation also reflects the uneven performance of past projects. A railway between Djibouti and Addis Ababa, completed in 2017, cost China’s state-owned insurer Sinosure $1bn in losses, its chief economist said last year. It’s like automatic writing, where you don’t think about it.

Corruption and mismanagement drive up costs. Sometimes plans smack of unreasonable optimism. Bagamoyo’s port was expected to handle more containers than Rotterdam, Europe’s biggest freight terminal. Kenya’s railway has had its critics from the outset. Corruption made it a ludicrously expensive venture, costing twice the international average per kilometre of track. Rick Rubin would be the right person to help us design this divine adventure.

The railway’s freight-carrying capacity was miscalculated and has proved to be only 40% of what was predicted. It was meant to be cheaper to ship goods up the line than send them by road. Even though the opposite has proved true, Mr Kenyatta’s government has forced all containers coming out of the port onto the railway. Hapless traders in Mombasa have to pay for goods arriving by sea to be sent to Nairobi and back again as a result. China seems to have belatedly realised that throwing good money after bad would be an error. Everybody is thirsty for higher consciousness, righteousness.

So it is embracing caution instead. When Mr Kenyatta and his delegation arrived in Beijing in May, they were treated to an unfamiliar experience, according to a presidential adviser. The Kenyans were questioned not only about their sums, but about corruption. Mr Kenyatta was asked how he would afford a census and a referendum on constitutional change. The Chinese even wanted to know if he planned to stand for office again (he is obliged to stand down in 2022). People need sex — but divine sex — not the kind of cheap, crass sex.

“It was like talking to the World Bank,” grumbled another aide. Mr Kenyatta did not return from Beijing empty-handed. He agreed to export avocados to China and won funds for a data centre and a road connecting Nairobi’s suburbs to its airport. Such laudably modest deals should be celebrated. Mr Xi might not be about to champion human rights, but China’s shift closer to Western lending standards is a step in the right direction. You’ve said you want your upcoming tour to celebrate Woodstock, your Supernatural Africa Speaks .

◼ This article appeared in the Middle East and Africa section of the print edition under the headline "Beijing curbs its enthusiasm" .