News / Asia

    China Announces $20 Billion in Africa Loans

    China's President Hu Jintao (R) shakes hand with Benin's President Thomas Yayi Boni before a group photo session during the opening ceremony for the Fifth Forum on China-Africa Cooperation at the Great Hall of the People in Beijing, July 19, 2012.
    China's President Hu Jintao (R) shakes hand with Benin's President Thomas Yayi Boni before a group photo session during the opening ceremony for the Fifth Forum on China-Africa Cooperation at the Great Hall of the People in Beijing, July 19, 2012.
    Shannon Sant
    BEIJING — China has announced $20 billion in loans to Africa over the next three years. The package was announced during the Forum on China-Africa Cooperation in Beijing.
     
    This is the fifth China-Africa forum held in Beijing, and leaders from many African countries, including South African president Jacob Zuma, traveled to China to attend. During a speech at the opening ceremony Chinese President Hu Jintao announced $20 billion in new loans to the continent.  
     
    This loan package is twice the amount of China’s last pledge of aid to Africa in 2009.  
     
    “China's assistance to Africa has been growing steadily,” he said. “[China] has met the pledge of providing 15 billion U.S. dollars of lending of a preferential nature to Africa,” said Hu.

    Loans for African resources

    Hu said the loans would go to infrastructure, agriculture and manufacturing projects, as well as the development of small and medium-sized businesses throughout the continent.  
     
    China aims to improve its ties to African countries on which it relies for oil, copper and other commodities that fuel China’s booming economy. Chinese government statistics report trade with Africa grew to about $166 billion in 2011. African exports to China have risen to $93 billion from slightly more than $5 billion in the last 10 years.  
     
    Chinese investment in Africa also is growing rapidly. But Beijing’s involvement has been criticized for resource-extraction projects accused of being exploitative, and for striking deals without adequate concern for human rights. Critics argue that Chinese investors should demand transparency and good governance before granting aid and financing development projects.  


    Mending past rifts

    Africans also have protested against Chinese companies importing Chinese laborers to Africa and for business practices that they say do not lead to better jobs or local wages.
     
    At Thursday’s forum Chinese officials highlighted what they call people-to-people and cultural exchanges as a driving factor in improving relations with African leaders.
     
    Zhong Weiyun is Deputy Director-general of the Bureau of African Affairs of International Department, who spoke about how China’s policies in Zambia came under harsh criticism during the country’s election last year.

    Reinforcing mutually beneficial ties

    He said meetings between the Communist Party officials and Zambia’s new leadership have helped to ease tensions and pave the way for new Chinese investment in the country.  
     
    Zhong said they were successful in dismantling those understandings between the two political parties, which paved the way and created conditions for the relationship to return to normal between the two countries.
     
    Analysts say the current global economic slowdown has made African countries more reliant on Chinese investment. In his speech Thursday,  Hu said Chinese aid to Africa would continue to grow in the years ahead and promised that China would remain a friend to the continent.

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    Comment Sorting
    Comments
         
    by: zhouxuhua from: China
    July 20, 2012 3:42 AM
    In China,there are a lot of people need money.I don't know why China take actions to improve those people's living levels by this money.Although african people do need the money.To my anger,someone said what China did enslaved African people and was hungry for superiority.From their standpoints,everyone who help others is hungry for superiority.If it was true,Jesus is on longer selfless.Because he is ready to help others.

    by: standingtall from: america
    July 19, 2012 7:32 PM
    Definitely a positive step for china and africa, especially africa. They should think independently what is best for them rather than being told by US what is best for them, or worst yet, fell into the victim and tools for a hidden agenda by old glorious western powers.
    In Response

    by: cloudy mood from: china
    July 20, 2012 3:23 AM
    well said!

    by: Dacite from: Canada
    July 19, 2012 2:08 PM
    That should make a lot of presidents rich and the people a lot poorer when they have to pay this back!
    In Response

    by: Dacite from: canada
    July 20, 2012 9:46 AM
    My point is : How much money has been given (not loaned) to Africa. It seems to end up in Swiss bank accounts of various dictators not in the infrastructure of the countries. So when it comes to loans, someone will have to pay them back even if they did not benefit from them.
    In Response

    by: judas from: China
    July 20, 2012 3:26 AM
    He is just worrying about corruption in China and Africa
    In Response

    by: Jonathan Huang from: canada
    July 19, 2012 9:56 PM
    To Dacite, are you sick? how building roads, rail ways, schools and hospitals make Africa people poorer?
    Africa needs those infrastructures to start her economy. China experience shows only when your infrastructures are done your economy can start boom.
    The old Chinese saying: instead of giving people fish rather teach them fishing.

    by: Mr. Lee from: South Africa
    July 19, 2012 12:52 PM
    The scares from European exploitation still show to this day. The country has been raped for centuries, now China is stepping in to heal the wound.

    by: Lead Roza from: N.J
    July 19, 2012 12:52 PM
    China may be hungry for superiority, but Africa is hungry for aid. I think this may be the start of a good and prosperous union.

    [http://www.inetsoft.com/info/report_tool_definition_and_demonstration/]

    by: Blake from: New York
    July 19, 2012 12:46 PM
    Here we go again, some many haters here. Sounds like US is the ONLY country that can deal/help others. But, the moment China or others do...OMG! The world is going to end.
    Self-absorbed, self-entitled Americans! In case you have not noticed because you are busy watching reality TV:
    The world does not revolve on US only.

    by: freddie from: U. S,
    July 19, 2012 9:44 AM
    good move for China and Africa
    In Response

    by: Randall Krieg from: Seattle
    July 19, 2012 4:23 PM
    Good move for China, yes, but not for Africa. Remember the concept of "third world debt"? Where the IMF and World Bank loaned billions to developing countries, a large fraction of which was siphoned off to private accounts controlled by dictators and their cronies? Then the people of those nations were left with long-term debt and no way to pay it back, and foreign interests were able to control their economies by dictating the terms of the loan rollovers. It's one of several ways that America and Europe engage in modern colonialism in all but name. More lately there have been some successful movements to forgive this debt, essentially writing it off and admitting it was a bad deal for everyone involved.

    Now China is getting in on this power play, and it's an excellent deal from their point of view -- but totally wrong for the "recipients". It's wrong fiscally, and wrong morally. While it is possible to make sustainable investment in infrastructure and production facilities that benefit the countries receiving the aid, that ain't the goal China has in mind here.
    In Response

    by: Pat from: Switz
    July 19, 2012 2:02 PM
    What move. ? The question is Who and Who is the loan going to and who and how is it going to' be' managed in the first place . If we cannot manage pur resources how can we manage a borrowed money . Our leader should ruturn there pot belli home and think of otre things to do.

    by: Jinghis Khan from: Inner Mongolia
    July 19, 2012 8:14 AM
    China issues as much money as it wants and buys even people's minds and causes enormous inflation not only in Africa but also in the rest of the world. Please stop wrongdoing.
    In Response

    by: Anonymous
    July 20, 2012 2:20 PM
    To Sodia, do you have any evidence to say "China wants to rule over Africa"? Then what will you say about USA and some Asian countries such as the Phillipines, Japan, South Korea,etc. Anyway USA just provides some help and "makes friends" with them, right? And USA also owes loans from China. If you think China wants to rule over USA, tell the Gov't not to accept the money and pay it back.
    In Response

    by: cliff loggrin from: lebanon, pa
    July 19, 2012 10:00 AM
    For the want of spending money in their own county, many countries are accepting loans/grants and assistance from the great nation of China.
    What private deals and future considerations, and costs!, are not often revealed to the population (thinking of Jamaica as I type this as there is no right-to-know, as in the US.) I believe the self-serviceing relationships should be factored in, and the long term affects. After all, isn't the US debt at $27,000 for every resident of American due to borrowing by elected representatives, passing this burden to future generations?
    In Response

    by: Sodia from: New Jersey
    July 19, 2012 9:59 AM
    I am afraid for Africa...they are so desperate for money but the Chinese are so controlling and hungry for superior-ism.. I feel they may try to rule over Africa and economically enslave the people like they have done their own people and other so called partnering countries. I will be praying for African leadership to not be greedy and sale the country into economic slavery but to be wise and clever with a love for its people's prosperity and economic freedom not just love for African leadership PERSONAL gain..my God be with Africa
    In Response

    by: Eason from: New York, US
    July 19, 2012 9:55 AM
    Excuse me, doesn't US do Quantitative Easing as well?
    In Response

    by: Anonymous
    July 19, 2012 9:54 AM
    Do you mean it is a good thing that people are poor and without enough food and medicare?

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