Connecting The Dots
China’s Belt and Road Initiative celebrates !" years of success in Africa
Ten years ago, what began as a dream by the Chinese government has evolved across various parts of the world as a key catalyst for job creation and poverty eradication, resulting in economic growth and development. As the Belt and Road Initiative (BRI) celebrates its 10th anniversary, it has made a global impression as a vast and ambitious infrastructure development project whose main objective is to connect Africa, Asia, Europe and other regions via a network of roads, railways, ports and other key infrastructural developments.
At the inception stage, critics threw a wet blanket on the BRI, particularly on realisation that the growing Sino-African relations was becoming a great force to be reckoned with. It became a point of ridicule to critics who label it a “debt-trap diplomacy” and “debt colonialism.” But far from it, the BRI has witnessed a decade of inclusive infrastructure development programmes in more than 150 countries, with more than 30 organisations supporting the initiative actively since it was launched in 2013.
Africa has been among the biggest beneficiaries of the BRI. In fact, statistics indicate that out of the 54 African countries, 52 have either signed or expressed interest to sign the BRI cooperation framework agreements and benefitted from projects under this initiative, particularly those of roads, energy, ports, and communications infrastructural development. These projects are meant to open up African countries to trade by facilitating construction of key domestic and regional infrastructure, to help African countries to access to affordable energy for industries and to open up transportation channels for African exports to international markets by creating efficient and reliable transportation channels.
Trade benefits
In Africa, the benefits of BRI cannot be gainsaid. For the last 10 years, trade has been on the front foot. The BRI has advanced steadily through Sino-African consultative
forums such as China International Import Expo and the Forum on China–Africa Cooperation, which have opened up Chinese markets to exports from African countries. These forums have been guided by the principles of extensive consultation, joint contribution and shared benefits for policy coordination, unimpeded trade, financial integration, facilities connectivity and people-to-people bond.
Sino-African relations have seen monumental growth in trade. According to trade statistics from China’s General Administration of Customs, the total trade between Africa and China surpassed the $2 trillion mark since the BRI was initiated in 2013. In fact, China has been the leading trading partner for Africa. In 2022, the trade statistics between China and Africa was recorded as $282 billion, a significant growth of 11 percent compared to 2021.
Therefore, it is imperative to note that the BRI has been a major catalyst for growth of trade in most African economies, promoting that trade through improved infrastructure. The connectivity created through construction and upgrading of roads, railways, ports and airports has improved transportation networks significantly by reducing the logistical bottlenecks, lowering shipping costs and facilitating free movement of goods not just between Africa and China, but also within the African countries themselves.
Additionally, the new infrastructure network on the continent has extinguished barriers to trade by creating trade corridors that connect African countries to global markets. It is these trade corridors that have become essential arteries for the free flow of goods, thereby making trade more efficient and cost-effective. This has played a pivotal role in reducing the market prices of these goods at international markets, making African exports competitive.
For instance, the construction of the Mombasa-Nairobi Standard Gauge Railway (SGR) in Kenya at a cost of $3 billion by China has greatly reduced the time and cost of transporting goods from the Port of Mombasa to other parts of the country and the region at large. The SGR has also been a good catalyst for promoting domestic and foreign tourism by facilitating more convenient and accessible movement of goods and people.
China’s grand plan is to increase trade between itself and Africa to $300 billion by 2025. To show commitment towards this cause, the Chinese government has enacted a policy that covers over 8,800 different types of products, including clothes and footwear, agricultural goods and chemicals.
Trade milestones
The BRI has also opened up the African continent to trade through increased connectivity by way of digitisation - encompassing the expansion of communication networks and the development of digital infrastructure. This has improved communication and access to information, especially in rural areas, catapulting most businesses to engage in both domestic and cross-border trade.
Just last year, the Chinese government waived tariffs on 98 percent of taxable imports from 18 African countries in two batches. This has ushered in an era of increased Chinese investments in the continent. In the last 10 years, according to statistics from China’s Ministry of Commerce, investments from China to Africa stood at $3.4 billion with more than 3,000 companies investing in Africa.
The value of newly contracted Chinese enterprises in African countries in the last 10 years exceeded $700 billion, with completed turnover of over $400 billion. The BRI has also been instrumental in ensuring development of economic zones and industrial parks along trade corridors in Africa. These zones are major magnets for foreign and domestic investors, thus stimulating manufacturing and processing for infant industries, resulting in creation of employment opportunities for the youth and boosting trade.
The BRI has achieved significant trade milestones. For instance, the BRI has contributed to promotion of trade facilitation by improving transportation links and connectivity, reducing the turnaround transactions period and the cost of moving goods for trade between African countries. This has resulted in growth of trade volumes, which has benefitted both the African economies and China.
The future of BRI in Africa is promising because it is the only surety for continued infrastructural development and increase in trade. The construction of more roads, railways, ports and energy projects is a sure bet for enhanced connectivity and trade between African countries themselves, and with China. If Africa has to fully industrialise and grow its trade fortunes, the industrialisation strategy must align itself to the BRI in order to accelerate special economic zones and industrial parks.