LENDING TO AFRICA
Is it true that China uses debt as a trap?
Former US Secretary of State, Rex Tillerson, says China's lending policy to Africa leads to dependency because they are shrouded in corrupt deals.
The head of African Development Bank (ADB), Akinwumi Adesina, tells the BBC that people get nervous about China but he is not. He thinks China is Africa's friend.
Assessing the asymmetry of power in the negotiation of the transactions, Adesina queries the rationale behind African countries decisions to give their mining rights away for highways built by China.
The BBC reports that Standard Bank's China Economist Jeremy Stevens wrote in a note that in “2017 alone, the value of the newly signed value of Chinese contracted projects in Africa registered $76.5bn”.
If a McKinsey and Company analysis is anything to go by,Chinese loans to Africa have tripled since 2012, including the bulky 19billion dollar given to Angola in 2015 and 2016. McKinsey’s projection is that revenues for Chinese firms in Africa could hit 440billion dollar by 2025.
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