Last week, the 12th US-Africa Business Summit, a high-level event attended by 11 African heads of state and government and some 1,000 business leaders, was held in Maputo, Mozambique. During the three-day event, US officials unveiled a $60bn investment agency which will seek to invest in low and middle-income countries, with a special focus on Africa.
The announcement came six months after National Security Advisor John Bolton presented the Trump administration’s “New Africa Strategy”. According to the document: “Great power competitors, namely China and Russia, are rapidly expanding their financial and political influence across Africa. They are deliberately and aggressively targeting their investments in the region to gain a competitive advantage over the United States.”
Although both China and Russia are mentioned, over the past few months, the US has demonstrated that it is mainly concerned about the former. In fact, it already appears that Africa is set to become yet another battleground for the escalating trade war between Beijing and Washington.
With increasing foreign military presence and growing diplomatic tensions, the continent is already witnessing the first signs of an emerging new cold war. And just like the previous one devastated Africa, fuelling wars and forcing African governments to make economic choices not in their best interests, this one will also be detrimental to African development and peace.
China’s approach to Africa has always been trade oriented. The continent became one of the top destinations for Chinese investment after Beijing introduced the so-called “Go Out” policy in 1999 which encouraged private and state-owned business to seek economic opportunities abroad.
As a result, Chinese trade with Africa has increased 40-fold over the past two decades; in 2017, it stood at $140bn. Between 2003 and 2017, Chinese foreign direct investment (FDI) flows have also jumped more close to 60-fold to $4bn a year; FDI stocks stand at $43bn – a significant part of which has gone to infrastructure and energy projects.
China has significantly expanded African railways, investing in various projects in Kenya, Ethiopia, Djibouti, Angola and Nigeria; it is currently building a massive hydropower plant in Angola and have built Africa’s longest railway connecting Ethiopia and Djibouti; it has built the headquarters of the African Union in Addis Ababa and the West African regional bloc ECOWAS in Abuja.
By contrast, for a long time the US has viewed Africa as a battlefield where it can confront its enemies, whether the Soviets during the Cold War, terrorists after 9/11 or now the Chinese. Washington has never really made a concerted effort to develop its economic relations with the continent.
As a result, trade between the US and Africa has decreased from $120bn in 2012 to just over $50bn today. US FDI flows have also slumped from $9.4bn in 2009 to around $330m in 2017. The new $60bn investment fund announced last week is a welcome initiative from the US but it will not be able to challenge Chinese economic presence on the continent. Just last year Chinese President Xi Jinping pledged $60bn too but dedicated it solely to investment in Africa.
The US has repeatedly accused China of using “debt to hold states in Africa captive to [its] wishes and demands” and has warned African states to avoid Chinese “debt diplomacy” which is supposedly incompatible with the independence of African nations and civil society and poses “a significant threat to US national security interests”.
Yet, Africa is only the fourth-biggest recipient of Chinese FDI after Europe (mainly Germany, UK and Netherlands), the Americas (mainly the US and Canada), and Asia. The US has also borrowed heavily from China; currently its debt to its rival stands at $1.12 trillion. By contrast, Africa owes China around $83bn.
Africans are fully aware of and concerned about high indebtedness, trade imbalances, the relatively poor quality of Chinese goods and services and Beijing’s application of lower standards of labour and environmental practices. But many do not share the American perspective that their economic relationship with China is to their detriment and rather see it as an opportunity that provides much-needed unconditional funding and that takes into account local priorities.
As Djibouti’s President Ismail Omar Guelleh has pointed out, “The reality is that no one but the Chinese offers a long-term partnership.”
The pressure the US is currently exerting on African countries to move away from partnerships with China could hurt African economies. It could force African countries into making choices that are not in their best economic interests and miss out on important development projects or funding.
Meanwhile, the US-China trade war is already affecting the continent. According to the African Development Bank, it could cause as much as a 2.5 percent decrease in GDP for resource-intensive African economies and a 1.9 percent dip for oil-exporting countries.
The escalating tensions between the US and China could also end up threatening the security of the continent. Both countries are militarily involved in Africa.
Over the past 15 years, the Chinese People’s Liberation Army has been engaged in a number of security missions across the continent, making modest auxiliary troop contributions to peacekeeping operations in Sudan, South Sudan, Liberia, Mali and the Democratic Republic of Congo. It has also contributed millions of dollars of peacekeeping equipment to the African Union Mission in Somalia and provided significant funding to the Intergovernmental Authority on Development for its mediation in South Sudan.
In 2017, the first Chinese overseas military base was opened in Djibouti. The facility, which currently hosts some 400 staff and troops, and has the capacity to accommodate 10,000, is officially supposed to provide support for the ongoing anti-piracy operations of the Chinese navy, but it also plays a role in securing maritime routes, part of the Belt and Road Initiative. There has also been speculation that this is the first of a number of planned bases meant to secure Chinese interests in Africa.
China’s military presence in Africa, however, pales in comparison to that of the US. Over the past few years, US Africa Command has run some 36 different military operations in 13 African countries, including Burkina Faso, Cameroon, Central African Republic, Chad, Democratic Republic of Congo, Kenya, Libya, Mali, Mauritania, Niger, Somalia, South Sudan and Tunisia. It has more than 7,000 troops deployed on the continent.
It has a large base in Djibouti – the biggest and only permanent US military base in Africa – but it also runs at least 34 other military outposts scattered across the west, east and north of the continent where US troops are deployed and military operations (including drone attacks) are launched from.
The US also directly supports the armies of Egypt, Nigeria, Ethiopia, Mali, Niger and others as well as the G5 Sahel force tasked with counterterrorism.
While a direct confrontation between US and Chinese forces in Africa is unlikely, their growing presence is becoming an increasingly destabilising factor. Already Washington’s strategy to contain Chinese influence over Africa is playing out at different conflict and social upheaval hotspots across the continent. The fallout of the US-Chinese competition is particularly apparent in the strategic Red Sea region, through which passes one of the most important maritime routes.
Countries in the region are not only feeling growing US and Chinese pressure to take one side or the other, but are also increasingly exposed to outside interference by various regional powers.
Growing regional tensions
Djibouti has recently found itself at the centre of US-Chinese diplomatic confrontation. Being a host to military bases of both superpowers, the small country has had to play a difficult balancing game.
In 2018, Djibouti seized control of its Doraleh Container Terminal from the Emirati company DP World, claiming its operation of the facility was threatening its sovereignty. The Djibouti authorities had feared that the UAE’s investment in the nearby Port of Berbera in the autonomous Somali region of Somaliland could challenge its position as the main maritime hub for Ethiopia’s large economy.
Its decision to terminate the contract with DP World, however, triggered a sharp reaction from Washington, a close Emirati ally. The Trump administration fears that Djibouti could hand over control of the terminal to China.
Bolton has warned: “Should this occur, the balance of power in the Horn of Africa – astride major arteries of maritime trade between Europe, the Middle East, and South Asia – would shift in favour of China. And, our US military personnel at Camp Lemonnier could face even further challenges in their efforts to protect the American people.”
Djibouti was forced to declare publicly that it would not allow China to take over the terminal but that has not assuaged US fears. Ever since, the US sought to secure a possible alternative location for its African military base: neighbouring Eritrea.
It encouraged regional actors, including Saudi Arabia and the UAE, to pull Eritrea out of its decades-long isolation. In a matter of months, long-time enemies Ethiopia and Eritrea concluded a peace agreement to end their 20-year-old cold conflict, while the UN lifted sanctions on Asmara. As a result, Eritrea could emerge as a strategic rival to Djibouti, offering its coast for foreign military and economic facilities. The UAE, for example, has already set up a military base near the port of Assab.
Sudan, to the north, has also been the battleground of the ongoing superpower turf war. China had been a long-term supporter of President Omar al-Bashir. Under his rule, Beijing came to dominate its oil industry, buying some 80 percent of its oil and thus providing Khartoum with much-needed cash to wage war against various rebel groups. It was also one of the few countries, along with Russia, that would break the UN arms embargo and sell weapons to al-Bashir’s regime.
After South Sudan gained independence in 2011, China continued to be a close partner of the Sudanese regime, remaining its main trading partner. Sudan in fact became the biggest beneficiary of the $60bn Africa investment package China pledged in 2018, having some $10bn in Chinese debt written off. The Chinese government also made a lot of plans to develop facilities in Port Sudan, where it already operates an oil terminal. Qatar and Turkey also signed deals with al-Bashir for various facilities in the port city.
When mass protests erupted in December last year, Beijing stood by al-Bashir, who it saw as the main guarantor of stability in the country, which falls on strategic routes, part of its Belt and Road Initiative.
Meanwhile, the US had repeatedly demonstrated that it did not want al-Bashir running for another term. His removal was approved in Washington, which has since appeared to back the interests of Saudi Arabia and the UAE in the country.
The two Gulf states currently hope to install another strongman sympathetic to their regional politics, who would maintain Sudan’s participation in the war in Yemen and curb Turkish and Qatari influence. At this point, it seems China is at risk of being sidelined by the significant sway the UAE and Saudi Arabia have with Sudan’s Transitional Military Council (TMC).
Apart from Djibouti and Sudan, various other countries in the region have felt the consequences of the US bid to contain China. This political confrontation has also added to the already rising tensions between other players in the region, including Egypt, Gulf countries, Iran and Turkey.
The Trump administration has particularly favoured Emirati, Saudi and Egyptian interests which have emboldened these three countries in their efforts to shape regional dynamics to their advantage.
Thus, in the long-term, given the pre-existing faultlines and conflicts in the region, the US-China cold war could have a detrimental effect, not only on its economy but also on its security.
At this point, to preserve its interests and its peace, Africa has only one option: to reject pressures to swear allegiance to either of the two powers. African countries should uphold their sovereignty in policy and decision-making and pursue the course that is in the best interests of their nations.
If the US wants to compete with China on the continent, it should do so in good faith. It can gain a competitive advantage by offering African countries better, more credible and principled alternatives to those put forward by China. But that can only happen if the US develops a strategy that focuses on Africa itself, not on containing and undermining the business of a third party.