#africannations — Public Fediverse posts
Live and recent posts from across the Fediverse tagged #africannations, aggregated by home.social.
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"It takes political chutzpah for a European leader to offer protection today to countries that were preyed on by his continental predecessors for half a millennium..."
That will be hard to sell, I imagine. Interesting article. Seems very middle ground, acknowledging issues.
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https://www.europesays.com/africa/147247/ With Middle East embroiled in conflict, these two African nations could hold the key to address Petroleum and Gas crisis; They are… #Africa #AfricanNations #Algeria #Chevron #Egypt #ExxonMobil #Gaddafi #Iran #italy #KhalifaHaftar #Libya #LibyanNationalArmy #LNG #MiddleEast #opec+ #OrganizationOfThePetroleumExportingCountries #PetroleumAndGasCrisis #Qatar #Spain #StraitOfHormuz #Tripoli #uae #WestAsia
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#Agroecology as the path to #ClimateResilient and just food systems
By Dr Susan Chomba, Director Food, Land and Water at World Resources Institute Africa
Monday, July 28, 2025 — updated on August 02, 2025
"The 2nd National Agroecology Symposium, held in Nairobi from July 10–11, 2025, marked a pivotal moment in #Kenya’s food systems transformation.
"The event brought together farmers, researchers, civil society, private sector actors, media, and policymakers with one clear message: Agroecology must move from the margins to the centre of national agricultural strategy. It is not just an alternative; it is the most viable path forward to achieve our intertwined goals for #people, #nature, and #climate—without compromising one for the other.
Agroecology offers a coherent framework for #RegeneratingSoils, producing safe and nutritious food, and building #ClimateResilient and #equitable #FoodSystems."As #ClimateChange intensifies, this approach provides Kenya and other #AfricanNations a powerful opportunity to lead a just transition—rooted in #LocalKnowledge, backed by #science, and responsive to the realities of #smallholder #farmers.
A crossroads for Kenya’s food systems
"Kenya’s food systems are at a crossroads. The dominant model—based on chemical-intensive agriculture and ultra-processed foods—is driving soil degradation, poor nutrition, increased prevalence of non-communicable diseases, and the pollution of our rivers and lakes. This model also contributes significantly to #biodiversity loss and #GreenhouseGasEmissions.
"Alternatively, a more resilient and #sustainable path is within reach—one that aligns human health with ecological integrity. But this transition cannot be left to smallholder farmers alone. It requires coordinated leadership from governments—particularly ministries of agriculture, health, environment, and finance—as well as development partners, scientists, and the private sector.
"Farmers should not be expected to feed a growing population and withstand escalating #ClimateShocks while being under-supported or misdirected by ineffective policies and subsidies. Without the right investments and incentives, we risk deepening the crisis.
What agroecology is—and isn’t
"Agroecology is too often misunderstood as a nostalgic return to low-productivity farming. In reality, it is a sophisticated, evidence-informed, and farmer-driven approach to transforming food systems in ways that are locally appropriate and ecologically sound. It is not a one-size-fits-all solution, but a dynamic practice that integrates scientific research with #TraditionalKnowledge.
"The Food and Agriculture Organization (FAO) outlines 10 elements of agroecology, while the High-Level Panel of Experts (HLPE) has identified 13 principles. These include #RecyclingNutrients, enhancing biodiversity, strengthening synergies, and co-creating knowledge."
Source [paywall]:
https://nation.africa/kenya/blogs-opinion/blogs/agroecology-as-the-path-to-climate-resilient-and-just-food-systems-5140556Archived version:
https://archive.ph/QxY8u#SolarPunkSunday #AgroEcology #FoodSecurity #Africa #ClimageChangeResiliency #SharingKnowledge
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#Agroecology as the path to #ClimateResilient and just food systems
By Dr Susan Chomba, Director Food, Land and Water at World Resources Institute Africa
Monday, July 28, 2025 — updated on August 02, 2025
"The 2nd National Agroecology Symposium, held in Nairobi from July 10–11, 2025, marked a pivotal moment in #Kenya’s food systems transformation.
"The event brought together farmers, researchers, civil society, private sector actors, media, and policymakers with one clear message: Agroecology must move from the margins to the centre of national agricultural strategy. It is not just an alternative; it is the most viable path forward to achieve our intertwined goals for #people, #nature, and #climate—without compromising one for the other.
Agroecology offers a coherent framework for #RegeneratingSoils, producing safe and nutritious food, and building #ClimateResilient and #equitable #FoodSystems."As #ClimateChange intensifies, this approach provides Kenya and other #AfricanNations a powerful opportunity to lead a just transition—rooted in #LocalKnowledge, backed by #science, and responsive to the realities of #smallholder #farmers.
A crossroads for Kenya’s food systems
"Kenya’s food systems are at a crossroads. The dominant model—based on chemical-intensive agriculture and ultra-processed foods—is driving soil degradation, poor nutrition, increased prevalence of non-communicable diseases, and the pollution of our rivers and lakes. This model also contributes significantly to #biodiversity loss and #GreenhouseGasEmissions.
"Alternatively, a more resilient and #sustainable path is within reach—one that aligns human health with ecological integrity. But this transition cannot be left to smallholder farmers alone. It requires coordinated leadership from governments—particularly ministries of agriculture, health, environment, and finance—as well as development partners, scientists, and the private sector.
"Farmers should not be expected to feed a growing population and withstand escalating #ClimateShocks while being under-supported or misdirected by ineffective policies and subsidies. Without the right investments and incentives, we risk deepening the crisis.
What agroecology is—and isn’t
"Agroecology is too often misunderstood as a nostalgic return to low-productivity farming. In reality, it is a sophisticated, evidence-informed, and farmer-driven approach to transforming food systems in ways that are locally appropriate and ecologically sound. It is not a one-size-fits-all solution, but a dynamic practice that integrates scientific research with #TraditionalKnowledge.
"The Food and Agriculture Organization (FAO) outlines 10 elements of agroecology, while the High-Level Panel of Experts (HLPE) has identified 13 principles. These include #RecyclingNutrients, enhancing biodiversity, strengthening synergies, and co-creating knowledge."
Source [paywall]:
https://nation.africa/kenya/blogs-opinion/blogs/agroecology-as-the-path-to-climate-resilient-and-just-food-systems-5140556Archived version:
https://archive.ph/QxY8u#SolarPunkSunday #AgroEcology #FoodSecurity #Africa #ClimageChangeResiliency #SharingKnowledge
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#Agroecology as the path to #ClimateResilient and just food systems
By Dr Susan Chomba, Director Food, Land and Water at World Resources Institute Africa
Monday, July 28, 2025 — updated on August 02, 2025
"The 2nd National Agroecology Symposium, held in Nairobi from July 10–11, 2025, marked a pivotal moment in #Kenya’s food systems transformation.
"The event brought together farmers, researchers, civil society, private sector actors, media, and policymakers with one clear message: Agroecology must move from the margins to the centre of national agricultural strategy. It is not just an alternative; it is the most viable path forward to achieve our intertwined goals for #people, #nature, and #climate—without compromising one for the other.
Agroecology offers a coherent framework for #RegeneratingSoils, producing safe and nutritious food, and building #ClimateResilient and #equitable #FoodSystems."As #ClimateChange intensifies, this approach provides Kenya and other #AfricanNations a powerful opportunity to lead a just transition—rooted in #LocalKnowledge, backed by #science, and responsive to the realities of #smallholder #farmers.
A crossroads for Kenya’s food systems
"Kenya’s food systems are at a crossroads. The dominant model—based on chemical-intensive agriculture and ultra-processed foods—is driving soil degradation, poor nutrition, increased prevalence of non-communicable diseases, and the pollution of our rivers and lakes. This model also contributes significantly to #biodiversity loss and #GreenhouseGasEmissions.
"Alternatively, a more resilient and #sustainable path is within reach—one that aligns human health with ecological integrity. But this transition cannot be left to smallholder farmers alone. It requires coordinated leadership from governments—particularly ministries of agriculture, health, environment, and finance—as well as development partners, scientists, and the private sector.
"Farmers should not be expected to feed a growing population and withstand escalating #ClimateShocks while being under-supported or misdirected by ineffective policies and subsidies. Without the right investments and incentives, we risk deepening the crisis.
What agroecology is—and isn’t
"Agroecology is too often misunderstood as a nostalgic return to low-productivity farming. In reality, it is a sophisticated, evidence-informed, and farmer-driven approach to transforming food systems in ways that are locally appropriate and ecologically sound. It is not a one-size-fits-all solution, but a dynamic practice that integrates scientific research with #TraditionalKnowledge.
"The Food and Agriculture Organization (FAO) outlines 10 elements of agroecology, while the High-Level Panel of Experts (HLPE) has identified 13 principles. These include #RecyclingNutrients, enhancing biodiversity, strengthening synergies, and co-creating knowledge."
Source [paywall]:
https://nation.africa/kenya/blogs-opinion/blogs/agroecology-as-the-path-to-climate-resilient-and-just-food-systems-5140556Archived version:
https://archive.ph/QxY8u#SolarPunkSunday #AgroEcology #FoodSecurity #Africa #ClimageChangeResiliency #SharingKnowledge
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#Agroecology as the path to #ClimateResilient and just food systems
By Dr Susan Chomba, Director Food, Land and Water at World Resources Institute Africa
Monday, July 28, 2025 — updated on August 02, 2025
"The 2nd National Agroecology Symposium, held in Nairobi from July 10–11, 2025, marked a pivotal moment in #Kenya’s food systems transformation.
"The event brought together farmers, researchers, civil society, private sector actors, media, and policymakers with one clear message: Agroecology must move from the margins to the centre of national agricultural strategy. It is not just an alternative; it is the most viable path forward to achieve our intertwined goals for #people, #nature, and #climate—without compromising one for the other.
Agroecology offers a coherent framework for #RegeneratingSoils, producing safe and nutritious food, and building #ClimateResilient and #equitable #FoodSystems."As #ClimateChange intensifies, this approach provides Kenya and other #AfricanNations a powerful opportunity to lead a just transition—rooted in #LocalKnowledge, backed by #science, and responsive to the realities of #smallholder #farmers.
A crossroads for Kenya’s food systems
"Kenya’s food systems are at a crossroads. The dominant model—based on chemical-intensive agriculture and ultra-processed foods—is driving soil degradation, poor nutrition, increased prevalence of non-communicable diseases, and the pollution of our rivers and lakes. This model also contributes significantly to #biodiversity loss and #GreenhouseGasEmissions.
"Alternatively, a more resilient and #sustainable path is within reach—one that aligns human health with ecological integrity. But this transition cannot be left to smallholder farmers alone. It requires coordinated leadership from governments—particularly ministries of agriculture, health, environment, and finance—as well as development partners, scientists, and the private sector.
"Farmers should not be expected to feed a growing population and withstand escalating #ClimateShocks while being under-supported or misdirected by ineffective policies and subsidies. Without the right investments and incentives, we risk deepening the crisis.
What agroecology is—and isn’t
"Agroecology is too often misunderstood as a nostalgic return to low-productivity farming. In reality, it is a sophisticated, evidence-informed, and farmer-driven approach to transforming food systems in ways that are locally appropriate and ecologically sound. It is not a one-size-fits-all solution, but a dynamic practice that integrates scientific research with #TraditionalKnowledge.
"The Food and Agriculture Organization (FAO) outlines 10 elements of agroecology, while the High-Level Panel of Experts (HLPE) has identified 13 principles. These include #RecyclingNutrients, enhancing biodiversity, strengthening synergies, and co-creating knowledge."
Source [paywall]:
https://nation.africa/kenya/blogs-opinion/blogs/agroecology-as-the-path-to-climate-resilient-and-just-food-systems-5140556Archived version:
https://archive.ph/QxY8u#SolarPunkSunday #AgroEcology #FoodSecurity #Africa #ClimageChangeResiliency #SharingKnowledge
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#Agroecology as the path to #ClimateResilient and just food systems
By Dr Susan Chomba, Director Food, Land and Water at World Resources Institute Africa
Monday, July 28, 2025 — updated on August 02, 2025
"The 2nd National Agroecology Symposium, held in Nairobi from July 10–11, 2025, marked a pivotal moment in #Kenya’s food systems transformation.
"The event brought together farmers, researchers, civil society, private sector actors, media, and policymakers with one clear message: Agroecology must move from the margins to the centre of national agricultural strategy. It is not just an alternative; it is the most viable path forward to achieve our intertwined goals for #people, #nature, and #climate—without compromising one for the other.
Agroecology offers a coherent framework for #RegeneratingSoils, producing safe and nutritious food, and building #ClimateResilient and #equitable #FoodSystems."As #ClimateChange intensifies, this approach provides Kenya and other #AfricanNations a powerful opportunity to lead a just transition—rooted in #LocalKnowledge, backed by #science, and responsive to the realities of #smallholder #farmers.
A crossroads for Kenya’s food systems
"Kenya’s food systems are at a crossroads. The dominant model—based on chemical-intensive agriculture and ultra-processed foods—is driving soil degradation, poor nutrition, increased prevalence of non-communicable diseases, and the pollution of our rivers and lakes. This model also contributes significantly to #biodiversity loss and #GreenhouseGasEmissions.
"Alternatively, a more resilient and #sustainable path is within reach—one that aligns human health with ecological integrity. But this transition cannot be left to smallholder farmers alone. It requires coordinated leadership from governments—particularly ministries of agriculture, health, environment, and finance—as well as development partners, scientists, and the private sector.
"Farmers should not be expected to feed a growing population and withstand escalating #ClimateShocks while being under-supported or misdirected by ineffective policies and subsidies. Without the right investments and incentives, we risk deepening the crisis.
What agroecology is—and isn’t
"Agroecology is too often misunderstood as a nostalgic return to low-productivity farming. In reality, it is a sophisticated, evidence-informed, and farmer-driven approach to transforming food systems in ways that are locally appropriate and ecologically sound. It is not a one-size-fits-all solution, but a dynamic practice that integrates scientific research with #TraditionalKnowledge.
"The Food and Agriculture Organization (FAO) outlines 10 elements of agroecology, while the High-Level Panel of Experts (HLPE) has identified 13 principles. These include #RecyclingNutrients, enhancing biodiversity, strengthening synergies, and co-creating knowledge."
Source [paywall]:
https://nation.africa/kenya/blogs-opinion/blogs/agroecology-as-the-path-to-climate-resilient-and-just-food-systems-5140556Archived version:
https://archive.ph/QxY8u#SolarPunkSunday #AgroEcology #FoodSecurity #Africa #ClimageChangeResiliency #SharingKnowledge
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This article does mention #Mining! Not surprising!
Promises and Pitfalls: #China’s Financing of the #AtewaBauxite #Mining Project in #Ghana
Author: Angela Benefo & Michael Addaney
Date Published: July 11, 2021"The #AtewaForestReserve in Ghana is a possible site for the development of an integrated #BauxiteAluminum mine through a Chinese resource-backed loan. Despite the opportunities for infrastructure development presented by the loan, this project carries significant risks. This article draws attention to #environmental sustainability challenges and the #DebtTrap conundrum associated with the proposed arrangement.
"President Xi Jinping has touted China’s recently unveiled Five-Year Plan as his country’s pursuit of ‘ecological civilization,’ a vision of promoting environmental sustainability and enhanced human-ecological interactions within and beyond China. However, China’s ability to promote ecological civilization in developing countries in line with this Plan will be challenging due to China’s generally poor environmental protection record in such contexts. For instance, while China claims it is prioritizing environmental sustainability in Africa, the #extractive projects initiated by its private sector do not align with this stated goal. These projects serve China’s broader interests and often create environmental consequences and problematic debt, therefore requiring a more careful analysis. A Chinese-backed bauxite-aluminum mine planned for a forest reserve in Ghana highlights the debt-trap concerns and environmental sustainability challenges created by some Chinese investments.
The Challenges of #ChineseLoans across #Africa
"China continues to play an enormous role in financing massive infrastructure projects in Africa. As the world’s largest official #creditor, China and its subsidiaries have invested billions of dollars across Africa’s energy, transportation, and mining sectors. Despite China’s indispensable contributions to infrastructure development in sub-Saharan Africa, there are valid concerns over how African countries will repay these massive debts to China.
"Compared to other official lenders such as the International Monetary Fund (#IMF) and the #WorldBank, Chinese loans are less challenging to acquire. For instance, the IMF monitors the amount of debt held by a country and will not provide more loans until a country seeks debt relief. Chinese lenders have more lenient terms and allow low-income African countries to borrow large amounts without much accountability—issuing loans which may be considered too risky by the IMF and other international lenders.
"Historically, China has entered into strategic agreements with developing countries to finance development projects while collateralizing the country’s natural resources. The growing demand for external finance for important infrastructure projects—some of which are overly ambitious and unsustainable—poses great risks to African economies, which risk losing their collateral and the possibility of debt distress.
"Chinese loans are often characterized by lack of transparency. Chinese financiers set tough conditions for financing large infrastructure projects, taking advantage of vulnerable African leaders desperate to complete ambitious developmental projects. For instance, the construction of a $10 billion port project in #Tanzania was suspended after careful consideration of the terms and conditions of the Chinese loan. The project, which the former president John Magufuli called 'exploitative and awkward,' would have rented the port to the Chinese government for ninety-nine years as repayment.
"In Ghana, Chinese financing over the past two decades has spanned various sectors including power, information communication technology (#ICT), #transportation, and #agriculture. Chinese foreign direct investment is estimated to be three times the size of EU countries’ investment in Ghana. Some of these loans are backed by resources such as #cocoa and #oil. For instance, #Sinohydro has allegedly agreed to deliver $2 billion worth of infrastructure projects across the country, which Ghana would pay back with proceeds from the sale of refined bauxite. An estimated $646 million of the initial $2 billion loan have been approved for disbursement. The Ghanaian government also signed a loan commitment of $550 million in 2019. Entering these types of agreements with China demands careful consideration by the Ghanaian government."
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Here we go... There's always a dark side when there's money involved... And when loans come due!
Dangers and Opportunities as #China’s #Loans to #Africa Come Due
Timothy Ditter | Monday, March 18, 2024
"Many African economies are facing a period of serious #economic distress with a very different character from the debt crisis of the 1980s and 1990s. This time, the People’s Republic of China (#PRC) is a major player, and a dramatic decline in PRC lending has compounded economic shocks in the aftermath of Russia’s invasion of Ukraine—just as the continent tries to recover from the pandemic. From 2001 to 2022, PRC financial institutions provided more than $170 billion in credit, loans, and grants to #AfricanNations, primarily to fund infrastructure projects tied to the PRC’s Belt and Road Initiative. But new PRC loans to African governments plummeted from $28.4 billion in 2016 to less than $2 billion in 2020 and have continued to decline.
"African governments are awakening to the fact that opaque PRC lending practices and problematic #LoanTerms have rendered already fragile economies at an increased risk of default. However, this moment of peril also provides an opportunity for African economies to build resilience by diversifying their economic partnerships and seeking out lenders with better terms and different motivations.
"I and other CNA analysts from our China Studies and Strategy and Policy Analysis programs have just completed a series of studies on trends in the involvement of the PRC across major sectors in Africa in the context of global shocks. These include the military, mining, infrastructure, and financial sectors. We recently released the report PRC Lending in Africa: Impacts in a Time of Global Shocks. This component of the series focuses on PRC lending to nine African countries. In some cases, PRC loans helped African nations build or upgrade much-needed infrastructure. However, we also found a wide range of PRC lending practices that have contributed to the financial distress and increased the risk of default for African countries ravaged by the global shocks of the last few years. These practices include high interest rates, unfavorable terms, and uncompetitive contracting, most of which is hidden from the public in opaque contracts.
"And when African countries struggle to repay those loans, PRC lenders have taken inflexible positions that have delayed and hardened terms in renegotiations.
"China’s Unforgiving Lenders
"Today’s debt troubles have some of their roots in the loan agreements signed when the PRC was eager to plow its excess savings into foreign loans. Often these agreements made the loans due in just 10 years, compared to up to 35 years for loans from the World Bank. Interest rates are often higher, too. For example, the Export–Import Bank of China charged Djibouti a fully commercial rate for the loan to build the Ethiopia-Djibouti railway, higher than multinational lenders like the World Bank charge for loans. The PRC is #Djibouti’s largest creditor, holding approximately $1.4 billion in debt, equal to about 45 percent of the country’s GDP. In January 2023, Djibouti suspended debt payments to the PRC, making it the second African nation—after #Zambia—to do so.
"Often these agreements require loan recipients to give business to PRC contractors—without competitive bidding. The Export–Import Bank of China contract with #Kenya to finance the Standard Gauge Railway connecting the port city of Mombasa to the Great Rift Valley stipulated that most construction materials would be purchased from the PRC. The project ended up much more costly than anticipated, increasing from 220 billion to 327 billion Kenyan shillings over a period of three years. The Kenya Court of Appeal found that 'the project’s design was manipulated to inflate costs while construction and supervision charges were also overpriced.' Such agreements have helped make China’s construction firms dominant on the continent. A University of London study found that of the 32 major international contractor companies working major construction projects in Ethiopia in 2017, 80 percent were PRC contractors.
"Because PRC loan agreements tend to be opaque, the public is usually not even aware of these loan terms. In the case of the Standard Gauge Railway, the loan with the Export–Import Bank of China was signed in 2014, but details about the terms only became publicly known in 2022, preventing oversight from Kenyan politicians or the public. In some cases, those opaque agreements and #unethical business practices may contribute to corruption. The Industrial and Commercial Bank of China funded a dam project in Angola while ignoring various potential red flags, including the involvement of the daughter of Angolan President José Eduardo dos Santos. Isabel dos Santos was awarded the $4.5 billion contract to construct the dam by her father’s government in 2015. As of 2023, Angola holds more PRC debt than any other country in Africa. And the #WorldBank listed Angola as one of seven African countries that it considered to be at high risk of debt distress in 2020.
"Our research found that when struggling African nations need to renegotiate their loans, PRC lenders have resisted standard #LoanForgiveness practices and have slowed debt negotiations. The PRC does not follow typical debt negotiation protocols used by multilateral institutions such as the World Bank. Instead, the PRC prefers bilateral negotiations, often behind closed doors, and strongly resists cutting the total principal owed on loans. Rather, PRC lenders favor extending repayment periods or holding infrastructure as collateral on loans. This has an impact on negotiations with other creditors as well, since lenders want concessions to be shared fairly. Recent negotiations to restructure #Chad’s debt with a committee of five bilateral creditors took nearly two years. World Bank and IMF officials claimed that lenders from China unnecessarily delayed the debt deal, an accusation that has come up in debt negotiations with other African countries.
"In the long run, however, this difficult period could have an upside for African nations. The reduction in PRC loans provides an opportunity for African countries to diversify, considering new economic partnerships on more favorable terms, with greater transparency and good governance. African nations can use multilateral negotiations to seek out lenders operating with different motivations, lenders that can help them build domestic economic strength and resilience for the future."
Source:
https://www.cna.org/our-media/indepth/2024/03/china-loans-to-africa -
Here we go... There's always a dark side when there's money involved... And when loans come due!
Dangers and Opportunities as #China’s #Loans to #Africa Come Due
Timothy Ditter | Monday, March 18, 2024
"Many African economies are facing a period of serious #economic distress with a very different character from the debt crisis of the 1980s and 1990s. This time, the People’s Republic of China (#PRC) is a major player, and a dramatic decline in PRC lending has compounded economic shocks in the aftermath of Russia’s invasion of Ukraine—just as the continent tries to recover from the pandemic. From 2001 to 2022, PRC financial institutions provided more than $170 billion in credit, loans, and grants to #AfricanNations, primarily to fund infrastructure projects tied to the PRC’s Belt and Road Initiative. But new PRC loans to African governments plummeted from $28.4 billion in 2016 to less than $2 billion in 2020 and have continued to decline.
"African governments are awakening to the fact that opaque PRC lending practices and problematic #LoanTerms have rendered already fragile economies at an increased risk of default. However, this moment of peril also provides an opportunity for African economies to build resilience by diversifying their economic partnerships and seeking out lenders with better terms and different motivations.
"I and other CNA analysts from our China Studies and Strategy and Policy Analysis programs have just completed a series of studies on trends in the involvement of the PRC across major sectors in Africa in the context of global shocks. These include the military, mining, infrastructure, and financial sectors. We recently released the report PRC Lending in Africa: Impacts in a Time of Global Shocks. This component of the series focuses on PRC lending to nine African countries. In some cases, PRC loans helped African nations build or upgrade much-needed infrastructure. However, we also found a wide range of PRC lending practices that have contributed to the financial distress and increased the risk of default for African countries ravaged by the global shocks of the last few years. These practices include high interest rates, unfavorable terms, and uncompetitive contracting, most of which is hidden from the public in opaque contracts.
"And when African countries struggle to repay those loans, PRC lenders have taken inflexible positions that have delayed and hardened terms in renegotiations.
"China’s Unforgiving Lenders
"Today’s debt troubles have some of their roots in the loan agreements signed when the PRC was eager to plow its excess savings into foreign loans. Often these agreements made the loans due in just 10 years, compared to up to 35 years for loans from the World Bank. Interest rates are often higher, too. For example, the Export–Import Bank of China charged Djibouti a fully commercial rate for the loan to build the Ethiopia-Djibouti railway, higher than multinational lenders like the World Bank charge for loans. The PRC is #Djibouti’s largest creditor, holding approximately $1.4 billion in debt, equal to about 45 percent of the country’s GDP. In January 2023, Djibouti suspended debt payments to the PRC, making it the second African nation—after #Zambia—to do so.
"Often these agreements require loan recipients to give business to PRC contractors—without competitive bidding. The Export–Import Bank of China contract with #Kenya to finance the Standard Gauge Railway connecting the port city of Mombasa to the Great Rift Valley stipulated that most construction materials would be purchased from the PRC. The project ended up much more costly than anticipated, increasing from 220 billion to 327 billion Kenyan shillings over a period of three years. The Kenya Court of Appeal found that 'the project’s design was manipulated to inflate costs while construction and supervision charges were also overpriced.' Such agreements have helped make China’s construction firms dominant on the continent. A University of London study found that of the 32 major international contractor companies working major construction projects in Ethiopia in 2017, 80 percent were PRC contractors.
"Because PRC loan agreements tend to be opaque, the public is usually not even aware of these loan terms. In the case of the Standard Gauge Railway, the loan with the Export–Import Bank of China was signed in 2014, but details about the terms only became publicly known in 2022, preventing oversight from Kenyan politicians or the public. In some cases, those opaque agreements and #unethical business practices may contribute to corruption. The Industrial and Commercial Bank of China funded a dam project in Angola while ignoring various potential red flags, including the involvement of the daughter of Angolan President José Eduardo dos Santos. Isabel dos Santos was awarded the $4.5 billion contract to construct the dam by her father’s government in 2015. As of 2023, Angola holds more PRC debt than any other country in Africa. And the #WorldBank listed Angola as one of seven African countries that it considered to be at high risk of debt distress in 2020.
"Our research found that when struggling African nations need to renegotiate their loans, PRC lenders have resisted standard #LoanForgiveness practices and have slowed debt negotiations. The PRC does not follow typical debt negotiation protocols used by multilateral institutions such as the World Bank. Instead, the PRC prefers bilateral negotiations, often behind closed doors, and strongly resists cutting the total principal owed on loans. Rather, PRC lenders favor extending repayment periods or holding infrastructure as collateral on loans. This has an impact on negotiations with other creditors as well, since lenders want concessions to be shared fairly. Recent negotiations to restructure #Chad’s debt with a committee of five bilateral creditors took nearly two years. World Bank and IMF officials claimed that lenders from China unnecessarily delayed the debt deal, an accusation that has come up in debt negotiations with other African countries.
"In the long run, however, this difficult period could have an upside for African nations. The reduction in PRC loans provides an opportunity for African countries to diversify, considering new economic partnerships on more favorable terms, with greater transparency and good governance. African nations can use multilateral negotiations to seek out lenders operating with different motivations, lenders that can help them build domestic economic strength and resilience for the future."
Source:
https://www.cna.org/our-media/indepth/2024/03/china-loans-to-africa -
Here we go... There's always a dark side when there's money involved... And when loans come due!
Dangers and Opportunities as #China’s #Loans to #Africa Come Due
Timothy Ditter | Monday, March 18, 2024
"Many African economies are facing a period of serious #economic distress with a very different character from the debt crisis of the 1980s and 1990s. This time, the People’s Republic of China (#PRC) is a major player, and a dramatic decline in PRC lending has compounded economic shocks in the aftermath of Russia’s invasion of Ukraine—just as the continent tries to recover from the pandemic. From 2001 to 2022, PRC financial institutions provided more than $170 billion in credit, loans, and grants to #AfricanNations, primarily to fund infrastructure projects tied to the PRC’s Belt and Road Initiative. But new PRC loans to African governments plummeted from $28.4 billion in 2016 to less than $2 billion in 2020 and have continued to decline.
"African governments are awakening to the fact that opaque PRC lending practices and problematic #LoanTerms have rendered already fragile economies at an increased risk of default. However, this moment of peril also provides an opportunity for African economies to build resilience by diversifying their economic partnerships and seeking out lenders with better terms and different motivations.
"I and other CNA analysts from our China Studies and Strategy and Policy Analysis programs have just completed a series of studies on trends in the involvement of the PRC across major sectors in Africa in the context of global shocks. These include the military, mining, infrastructure, and financial sectors. We recently released the report PRC Lending in Africa: Impacts in a Time of Global Shocks. This component of the series focuses on PRC lending to nine African countries. In some cases, PRC loans helped African nations build or upgrade much-needed infrastructure. However, we also found a wide range of PRC lending practices that have contributed to the financial distress and increased the risk of default for African countries ravaged by the global shocks of the last few years. These practices include high interest rates, unfavorable terms, and uncompetitive contracting, most of which is hidden from the public in opaque contracts.
"And when African countries struggle to repay those loans, PRC lenders have taken inflexible positions that have delayed and hardened terms in renegotiations.
"China’s Unforgiving Lenders
"Today’s debt troubles have some of their roots in the loan agreements signed when the PRC was eager to plow its excess savings into foreign loans. Often these agreements made the loans due in just 10 years, compared to up to 35 years for loans from the World Bank. Interest rates are often higher, too. For example, the Export–Import Bank of China charged Djibouti a fully commercial rate for the loan to build the Ethiopia-Djibouti railway, higher than multinational lenders like the World Bank charge for loans. The PRC is #Djibouti’s largest creditor, holding approximately $1.4 billion in debt, equal to about 45 percent of the country’s GDP. In January 2023, Djibouti suspended debt payments to the PRC, making it the second African nation—after #Zambia—to do so.
"Often these agreements require loan recipients to give business to PRC contractors—without competitive bidding. The Export–Import Bank of China contract with #Kenya to finance the Standard Gauge Railway connecting the port city of Mombasa to the Great Rift Valley stipulated that most construction materials would be purchased from the PRC. The project ended up much more costly than anticipated, increasing from 220 billion to 327 billion Kenyan shillings over a period of three years. The Kenya Court of Appeal found that 'the project’s design was manipulated to inflate costs while construction and supervision charges were also overpriced.' Such agreements have helped make China’s construction firms dominant on the continent. A University of London study found that of the 32 major international contractor companies working major construction projects in Ethiopia in 2017, 80 percent were PRC contractors.
"Because PRC loan agreements tend to be opaque, the public is usually not even aware of these loan terms. In the case of the Standard Gauge Railway, the loan with the Export–Import Bank of China was signed in 2014, but details about the terms only became publicly known in 2022, preventing oversight from Kenyan politicians or the public. In some cases, those opaque agreements and #unethical business practices may contribute to corruption. The Industrial and Commercial Bank of China funded a dam project in Angola while ignoring various potential red flags, including the involvement of the daughter of Angolan President José Eduardo dos Santos. Isabel dos Santos was awarded the $4.5 billion contract to construct the dam by her father’s government in 2015. As of 2023, Angola holds more PRC debt than any other country in Africa. And the #WorldBank listed Angola as one of seven African countries that it considered to be at high risk of debt distress in 2020.
"Our research found that when struggling African nations need to renegotiate their loans, PRC lenders have resisted standard #LoanForgiveness practices and have slowed debt negotiations. The PRC does not follow typical debt negotiation protocols used by multilateral institutions such as the World Bank. Instead, the PRC prefers bilateral negotiations, often behind closed doors, and strongly resists cutting the total principal owed on loans. Rather, PRC lenders favor extending repayment periods or holding infrastructure as collateral on loans. This has an impact on negotiations with other creditors as well, since lenders want concessions to be shared fairly. Recent negotiations to restructure #Chad’s debt with a committee of five bilateral creditors took nearly two years. World Bank and IMF officials claimed that lenders from China unnecessarily delayed the debt deal, an accusation that has come up in debt negotiations with other African countries.
"In the long run, however, this difficult period could have an upside for African nations. The reduction in PRC loans provides an opportunity for African countries to diversify, considering new economic partnerships on more favorable terms, with greater transparency and good governance. African nations can use multilateral negotiations to seek out lenders operating with different motivations, lenders that can help them build domestic economic strength and resilience for the future."
Source:
https://www.cna.org/our-media/indepth/2024/03/china-loans-to-africa -
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