Foreign Loans: China Is A Better Ally For Africa Than US, UK, Other Western Countries –Nigeria's Vice President, Osinbajo
March 30, 2023 NEWS
Osinbajo, who stated this at King's College London, on Monday, on China's Investment in Africa, revealed that Africa needs the loans and infrastructure that China provides, maintaining that China shows up where and when the West will not show up or are reluctant to do so.
Nigeria's Vice President, Prof Yemi Osinbajo has openly said that African countries see the Peoples Republic of China as a better ally regarding foreign loans than the West.
Osinbajo, who stated this at King's College London, on Monday, on China's Investment in Africa, revealed that Africa needs the loans and infrastructure that China provides, maintaining that China shows up where and when the West will not show up or are reluctant to do so.
Recalling the memory of the destructive conditionalities of the Brenton Woods loans, which he described as still fresh, Osinbajo, a professor of law stated that most African countries are rightly unapologetic about their close ties with China.
According to him, China has remained the largest provider of foreign direct investment that supports hundreds of thousands of African jobs.
Osinbajo reminded the West that China is lending Africa with 5% while the Western countries and institutions lend with 23% which is outrageous when compared together.
He stated, "$254 billion in 2021, about four times the volume of US - Africa trade. China is the largest provider of foreign direct investment, supporting hundreds of thousands of African jobs.
"This is roughly double the level of US foreign direct investment. China remains by far the largest lender to African countries. Chinese companies have also taken the lead in exploiting minerals in Africa, many now in lithium mining in Mali, Ghana, Nigeria, DRC, Zimbabwe and Namibia.
"Most African countries are rightly unapologetic about their close ties with China. China shows up where and when the west will not or are reluctant. And many African countries are of the view that the beware of the Chinese Trojan loans advise form the west is wise but probably self-serving. Africa needs the loans and the infrastructure. And China offers them. In any case the history of loans from Western institutions is not great.
"The memory of the destructive conditionalities of the Breton Woods loans are still fresh and the debris is everywhere. And the preoccupation of western governments and media with the so-called China debt trap might well be an over-reaction. I recommend an eye opening lecture by Professor Deborah Brautigam about two weeks ago at Jesus College Cambridge."
He added, "The truth as she points out, is that all of Chinese lending to Africa is only 5% of all outstanding public and publicly guaranteed debt in low- and middle-income countries, compared to 23% held by the World Bank and other multilaterals. Chinese lenders account for 12 per cent of Africa's private and public external debt. And the Chinese have also been there when the debts cannot be paid.”
"In early 2020 as COVID battered African economies China came together with other G20 members to launch the Debt Service Suspension Initiative (DSSI). 73 low-income economies benefited from the suspension of principal and interest payments. Chinese banks provided 63% of the total debt relief while being only owed 30% of the debt service payments due," he stated.
