Apunte 3 / 2019
Juan Del Pozo Berenguer
In an address to the George Mason University, then Secretary of State Rex Tillerson energetically criticised China´s approach to the infrastructure gap issue which the African continent is facing. The main target of his criticism was the galloping debt generated by China´s investment which lacks, he said, sustainability, and raises considerable doubt as to its capacity to boost employment to acceptable levels, making this approach a new kind of colonialism.
China has been raising its stakes in Africa since 2000 with Djibouti as a shining example of its interest in the region, managing to increase this small country´s debt from 50% GDP to a whopping 85% according to recent data from the International Monetary Fund1. It could be argued that this debt is manageable, as Djibouti´s Foreign Minister Mohamoud Ali Youssouf stated, but questions as to the sustainability of this debt in the terms expressed by Tillerson are beginning to cause distress. But, are there reasons to be concerned?
The truth of the matter is that the US has been playing the same ball game with respect to African development since the Obama Administration. Former Secretary of State Hillary Clinton had raised concerns in the same terms as Tillerson, but no policy has ever emerged, while China continues to invest under her own terms, unstoppable and with no apparent contender with a solid alternative to offer. To make matters worse (or better?), the OBOR initiative, presented as a combination of two initiatives by president Xi Jing-ping in
September 2013 and during his state visit to Indonesia in October 2013, is beginning to take its toll on those who have ventured to sign up for it; it has been suggested that China is using this initiative to take home what grows in foreign soil, in what now seems to be a clear case of a commercial tool used with geopolitical purposes.
Challenges for Europe
But, as Deborah Brautigam2 suggests, whereas European countries are establishing their own factories in China in order to reduce costs, particularly in manufacturing, African countries are creating factories in their own lands and seeking Chinese aid in order to make them sustainable, using local labour, and having their people receive training in China3, which is an indication that perhaps our politician´s perception of China is not well founded. This detail actually suggests that there may be a sustainable future in the pipeline for most Chinese projects in the African continent. There are many examples which corroborate this, such as the fishing factory established in Nouadhibou, Mauritania, manned by both Chinese and local personnel, and using an entire Chinese fishing fleet permanently stationed in those waters. For sure a great deal of the profits go rushing back to the Asian country, but Mauritania has a godsend opportunity to take advantage of China´s investment and technology in situ. That is, if Mauritania has indeed any interest in the fishing industry, otherwise it´s just a way of creating debt in return for nothing. And this is the key question: what is it that Africa wants?
When approached to comment on China´s involvement in African industry, former advisor on China affairs to the Senegalese president Ibrahima Diong claimed that China knows for sure what it wants from each country in which it invests, but has serious doubt as to the reciprocity of this interest from its African partners. And it makes sense since some African countries have been investing plenty of resources in building unnecessary hotels, aquariums and so forth, when maybe these shouldn´t be a top priority4. “If your problem is energy”, Diong says, “and you get China to build you a stadium, who is to blame?”.
African countries must set their priorities right. Projects and investment must seek a true and honest need, whilst guaranteeing that the project will eventually be sustainable in the long run. But this also calls for the ability of these much-needed countries to be able to take the reins of their own projects so that Chinese dependency is reduced with each passing year. Mauritania and Ghana have been given patrol ships for the navy by the Chinese government, but maintenance of these vessels is totally dependable on their Asian partner, as they are fitted with a very specific technology, with spares and parts not 3 Apunte 3 / 2019
available outside China. Even if local engineers are trained in China, they will invariably need their aid in order to meet the maintenance and operational challenges they will face. Perhaps this is a need that could have been sought elsewhere, as they will never be able to detach themselves from their partner, and have accepted China´s investment in other areas such as the previously mentioned fishing factory, where rather than technology, it is the principle of organizing a business such as this which is not only needed, but self-sustainable in the long run.
The debt generated in African countries on account of Chinese investment is increasing to what appears to be unsustainable levels. But the problem does not entirely lie in the debt all by itself, as Mr Tillerson stated, but rather on the nature of the projects selected, and the ability of these countries to actually make them work on their own without further aid. Who is to blame for this ever-increasing debt then?
Tillerson´s view on the difficulties of competing with China on the same terms certainly applies to any European state, particularly in those areas in which Europe has a saying in world commerce, fishing being an excellent example. But despite the considerable effort by Europe as a whole, and some of its member states at a national level, approaching or even understanding African policy towards investment is difficult to approach with a certain degree of success.
The military dimension
But, as it could be no other way, there is a military component to Chinese investment in the African continent which seems to be causing some distress. Earlier in 2018, USMC General Thomas Waldhauser, top US military commander for Africa, stated his concern over the now undeniable control of China over port facilities in Djibouti, which could eventually lead to restrictions in the use of these facilities to other clients, thus hampering the adequate supply to US forces deployed in the region5, in what could well be a clear indication that China is, in fact, seeking to provide its port facilities overseas with a dual commercial-military role.
The concern is well-founded now that China already has an operational military base adjacent to the port, referred to as a logistics support base by Chinese officials, and the Djibouti government has recently rescinded the contract over the Doraleh Container Terminal with the previous contractor, Dubai´s DP World, despite UAE´s outrage over unproven bribe allegations supposedly carried out by the Arab company, to justify this decision. This creates a dangerous precedent, for, as Republican Representative from Alabama Bradley Byre pointed out, what is to stop the Djibouti Government from reneging the twenty-year lease signed in July 2014 over Camp Lemmonier to the US?
The price of investing
For the moment, the Djibouti Government has welcomed Chinese investment, despite the galloping debt it is generating, which is now at an astonishing $1.4 billion6. In his visit to the African region, former Secretary of State Rex Tillerson insisted on pointing out the ever-increasing trail of debt China is leaving in its wake, but Djibouti Foreign Secretary Mahamoud Ali Youssouf has adamantly pointed out that “no country can develop itself without infrastructure, and China is, from that perspective, a very good partner”.
On top of this, China is now on the verge of a new geostrategic success which has caught the attention of the Indian Observer Research Foundation think tank: the Sri Lanka port of Hambantota, on a 99 year lease over the port facility to be run by China Merchants Port Holdings, with Tanzania, Maldives, the strategic Walvis Bay in Namibia and Myanmar are also under the scope of the OBOR anvil. The Indian think tank raises deep concern over the possibility of having Hambantota turned into a new Djibouti case. But India continues to stand on its own feet maintaining strong ties with their African partners through the India
Africa Forum with an alliance valued at $52billion, nowhere near the $400 billion provided by the Chinese7.
China is no longer in a position to pursue a non-interventionist foreign policy; its commercial ties and responsibilities have placed the Asian country in a situation where she must be ready to commit her forces in a comprehensive manner, and subject to international scrutiny. The evacuation of Chinese citizens from Libya in 2014, the deployment of a PLAN frigate in 2011 also to Libya to protect Chinese nationals during some protests, are just some of the isolated examples of military operations which China will continue to undertake. But, unsure as to the true nature of the OBOR initiative, which at the moment seems more interventionist than a partnership deal, the deployment of military units across the African Continent is raising deep concern, and neighbouring countries, most notoriously India, are ready to take the necessary steps to protect their investments strengthening their military presence in the region, in a military escalation which must be observed carefully.
What is the next step?
Europe has a vested interest in Africa from a commercial and security perspective alike. Interestingly, these two elements have not been met with the same interest from our African partners. Mauritania represents a shining example in which military cooperation with some European stakeholders is beyond question, but none of these nations, Spain being a good example on account of the military missions it permanently has in that country in the field of cooperative security, are capable of competing on equal terms with
1 Laura Koran, “Why China´s footprint in Africa worries the US“, CNN, March 2018
2 Deborah Brautigam is the Director of the China Africa Research Initiative at John Hopkins University.
3 Deborah Brautigam, The World Post, April 12, 2018.
4 Even the otherwise excellent document Africa Integrated Maritime Strategy (2050 AIMS, issued January 2014) proposes building giant aquariums and sponsoring yacht races around Africa, in a strange mix with other measures mostly relevant to maritime security.
5 Weaponizing Capital: US worries over China´s expanding role in Africa, Steve George and Brad Lendon, CNN March 2018.
6 Center for Global Policy Development, 2018
7 China´s Expanding Military Footprint in Africa, Harsh V. Pant and Ava M. Haidar, ORF Issue Brief, September 2017
Chinese industry. They are more than willing to accept aid from European states, particularly Spain, France and Portugal in terms of cooperative security, but seem reluctant to extend those ties to the commercial domain.
The projects China in currently undergoing in Africa are not only generating an increasing debt at a galloping rate, but also make these countries dependant on further Chinese investment as the years go by.
Keeping the military cooperation ties with African countries is a must if commercial success is to be expected in the fullness of time. The Gulf of Guinea has turned out to be an important hotspot with security based issues in which not even China has been willing or capable to tackle it with a minimum degree of success. French and Spanish Navy ships regularly patrol the region with regional nations´ personnel on board in joint missions which have contributed to creating an environment of confidence. This is a first step which we would do well in maintaining for the time being.
Juan Del Pozo Berenguer, Capitán de Corbeta de la Armada Española y colaborador del Centro de Seguridad Internacional