Africa-China relations: new frontiers of co-operation?

Despite a tough 2020, Sino-African relations remain strong. In 2021 and beyond China will retain a keen appetite for African ventures and explore new frontiers of co-operation in a bid to strengthen commercial ties. 

In a recently published report, “Taming the dragon: new frontiers of co-operation”, The Economist Intelligence Unit explores this evolving relationship between Africa and China. 

Key report findings include:

• China will seek to enhance relations with Africa in 2021 and beyond, with a fresh focus on agriculture, environmental issues, the digital economy, healthcare provision, industrial capacity, regional connectivity and free trade and national security.

• The Belt and Road Initiative (BRI) will continue to drive international connectivity with major developments in the pipeline to enhance trade facilitating infrastructure.

• Enhancing food security is high up the list of policy priorities in both Africa and China. Engagement in African agricultural ventures increasingly characterised by corporate mergers, acquisitions and joint ventures involving private companies. 

• Digital expansion will be boosted by the completion of a cross-border fibre optic cable in Pakistan, forming the backbone of China’s Digital Silk Road.

• China will seek to engage in more bilateral and collective free-trade deals, presenting the potential starting point for more in-depth trade and investment ties.

Editorial director and author of the report, Pratibha Thaker, explains the impact this evolving relationship will have on African markets:

African states stand to benefit substantially from Chinese interest in the region in terms of industrial and technological development, regional and international connectivity, and global value-chain integration in the years ahead. Currently, Africa remains receptive to Chinese engagement, recognises the benefits that could accrue, and is actively seeking Chinese economic support, which bodes well for Sino-African relations. However, securing Chinese commitments is not a given, and achieving the best possible deal will require that African governments and companies hone their bargaining skills and fully value what they have to offer.

The report also notes that African debt exposure to China will remain a serious concern and anti-Chinese sentiment within some African populations is simmering below the surface, with citizens resentful of Chinese economic influence and the lack of higher-value job creation for locals associated with some Chinese investments.

Download the free report: “Taming the dragon: new frontiers of co-operation”