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The value of loans granted by Chinese lenders to energy and infrastructure projects in Africa nearly tripled between 2016 and 2017, from $ 3 billion to $ 8.8 billion, China Development Bank and China Exim Donors Being Particularly Active According to a multinational law firm, Baker McKenzie
the firm said in a statement this week that nearly half of the $ 19 billion US in Chinese loans Abroad Sub-Saharan African Infrastructure Projects In particular, Chinese lenders accounted for more than 40% of all infrastructure financing in Sub-Saharan Africa in 2017 and its political banks have done more. four-fifths of loans granted by development finance institutions (DFIs).
Loans granted by Chinese commercial and public banks for infrastructure projects in sub-Saharan Africa totaled US $ 3.6 billion in 2014, US $ 3.4 billion in 2015 and US $ 3 billion EU in 2002. 016, before climbing almost 300% to US $ 8.8 billion in 2017, thanks to a series of major energy projects in Africa.
Trends are revealed by new research from the international law firm Baker McKenzie and IJGlobal infrastructure projects, such as BRICS bloc leaders – Brazil, Russia, India, China and South Africa – meet in Johannesburg this week for their annual summit.
The data come exclusively from fully funded projects and exclude recent announcements of government funding pledges Speaking of the BRICS Energy event, which preceded the BRICS summit, Kieran Whyte, head of the company. energy, mining and infrastructure at Baker McKenzie in Johannesburg, said that the growing impact of Chinese political lending in Africa is becoming more visible
. Chinese President Xi Jinping's recent tour to African countries ahead of the summit is evidence of the growing interdependence of the rapidly growing but growing Chinese economy "These are much more sophisticated outbound loans than the cliché that China is investing in African minerals and rail to provide products to China to fuel manufacturing – the data clearly show that Chinese loans are moving to Africa "All countries need reliable, demand-responsive generating, transmission and distribution assets," Jon Whiteaker, editor-in-chief of IJGlobal
"It is not so not surprising that the electricity sector is by far the largest beneficiary of China 's lending in Africa. The US government may have recently launched its Power Africa program, but it is more and more Chinese lenders that African and Middle Eastern countries have funded to finance their energy projects. "
Since 2012, the BIS has grown from 31 transactions in 2012 to 105 transactions in 2017. The BIS is a Chinese-wide development strategy that combines the creation of a 21st Maritime Highway. Silk and the Silk Road Economic Belt
Whyte explained that this shift to power is explained by the fact that China is comfortable in the sector of the Silk Road. energy and that it is a catalyst for the growth of other sectors in Africa.For long-term economic development.
"It is also true that in terms of infrastructure development, many construction in China are world leaders. In the energy sector, Chinese goods and equipment are used in the construction process, which further benefits the Chinese economy, "he said. BRICS Summit Energy event this week, China is committed to investing US $ 14.7 billion in South Africa and providing loans to Eskom and Transnet.
a geopolitical change in trade relations, China noted it seeks to work with African countries in a participatory and inclusive way.
Another recent report by Baker McKenzie and Silk Road Associates, Belt & Road: opportunities and risks – the Prospects and the dangers of building the new Silk Road in China show that the main opportunities in Africa with regard to the Belt & Road initiative will be transactions related to major projects in the sector. energy and infrastructure. 19659002] Recent examples of large-power operations in Africa where at least 50% of the financing was provided by Chinese lenders include: Mambila hydroelectric plant (Nigeria) valued at $ 5.8 billion, coal-fired power plant Lamu (Kenya), United States The Medupi coal-fired power plant (South Africa), worth $ 2 billion, worth $ 1.5 billion, the Kafue Gorge (Zambia) in 2015, worth $ 1.5 billion.
Kenya and Nigeria, which alone have absorbed nearly 40% of the $ 19 billion in loans to projects in sub-Saharan Africa since 2014.
However, Chinese banks have been active lenders of infrastructure projects in 19 different countries. s in the last four years. Senegal is expected to become the first country in West Africa to support the IRB.
Infrastructure projects in Ethiopia received 1.8 billion US dollars since 2014, Kenyan projects 4.8 billion, Mozambique infra treats 1.6 billion US dollars and Nigerian projects 5 billion US dollars of Chinese lenders. Infrastructure projects in South Africa have received $ 2.2 billion from Chinese lenders since 2014, Zambia received $ 1.5 billion and Zimbabwe received $ 1.3 billion in loans from Chinese lenders since 2014.
The electricity sector in sub-Saharan Africa has received USD 17.5 billion in loans from Chinese lenders since 2014 (US $ 8.8 billion of this amount was in 2017). The oil and gas sector received $ 3.2 billion ($ 1.7 billion in 2017) and the transport sector in sub-Saharan Africa received $ 5.5 billion from Chinese lenders since 2014 ($ 500 million in 2017).
Whyte noted that for investors in Africa, "A major attraction of the Belt and Road Initiative for African governments and project proponents is that it helps in implementing project stakeholders indicate that the whole process is much faster than the other options: Chinese donors help to provide liquidity and help accelerate the implementation of projects in Africa, which is necessary for Africa to participate in the deployment of the Fourth Industrial Revolution and the Global Energy Transition, "he added: Indian Prime Minister Narendra Modi, Chinese President Xi Jinping with South African President Cyril Ramaphosa with their wives on the second day of the 10th BRICS Summit at the Sandton Convention Center.
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