Africa gets $60bn ‘funding support’ from China

President Xi Jinping of China, today, announced that his country would assist African states with loans to the tune of $60 billion, to the relieve of several African leaders whose countries are hit by the crash in commodity prices and are looking for ways to fund their economies. The  move sends a strong message on China’s commitment to strengthening ties with Africa.

“China decides to provide a total of $60 billion of funding support that includes $5 billion of grants in zero interest loans and $35 billion in preferential facility and export credit loans and concessional loans,” President Xi said as he addressed delegates at the Forum on China-Africa Cooperation (FOCAC) in Sandton, Johannesburg.

The forum themed Africa-China Progressing Together: Win-Win Cooperation for Common Development, is expected to end with a Declaration and Action Plan, which will outline measures aimed at consolidating China-Africa partnership.

China’s relationship with Africa has often been criticized as neo-colonialist as the Asian powerhouse grew its trade to become the continent’s largest trading partner. According to China state news agency Xinhua, the trade volume between them amounted to $220 billion in 2014. China continued giving out development funds to the continent, offering loans totalling $32 billion to African nations in the past two years.

However, when these loans are offered, infrastructure developed with them are often undertaken by Chinese companies, often with little regard for environmental and cultural sustainability. China has always tried to prove otherwise.

In May 2014, when Chinese Premier Li Keqiang’s visited four nations in Africa, he remarked: “I wish to assure our African friends, in all seriousness, that China will never pursue a colonialist path like some countries did or allow colonialism, which belonged to the past, to reappear in Africa.”

Chinese Foreign Minister Wang Yi reassured Africans ahead of the Johannesburg summit, saying: “Cooperation between China and Africa is built upon equality and mutual development.”

China will be hoping its new commitments change opinions about its relationship with Africa and strengthen cooperation between the two.

Before travelling to South Africa for the FOCAC and talks with Zuma, Xi had first visited Zimbabwe where, during his two-day visit, he witnessed the signing of 10 business agreements which included a $1 billion funding of Zimbabwe’s largest thermal power plant. He later oversaw the signing of 26 agreements with South African companies and government departments worth R94 billion ($6.5 billion).