China is a good development partner for Africa and concern about the abundance of Chinese lending to African nations is overblown says the President of the African Development Bank Akinwumi Adesina.
Speaking ahead of the opening of the Africa Investment Forum in Johannesburg, South Africa, Adesina said: “Africa should not be afraid of China, it’s a very good learning experience for Africa, lifting 400 million people out of poverty.”
China has surpassed the U.S. and Europe as the biggest source of funding to African nations. In 2015, Africa received $12 billion in loans from China compared with $100 million in 2000.
Still, critics have warned against African countries becoming over-indebted or swapping future output of commodities in exchange for funds on overly favourable terms.
Adesina stated: “African countries are mature enough to negotiate with China about their needs, which is to close infrastructure gaps.”
The AfDB hopes to sign deals worth around $40 billion at the Investment Forum, but Adesina said African countries must also seek funding elsewhere.
Officially kicking off the Forum on Wednesday, Manemolla David Makhura, Premier of Gauteng referred to the gathering as ‘historic’ and indicated that Africa needs to move from poverty to prosperity.
“This is not an event. It is a platform where governments, the private sector, investors, and project promoters come together. We develop quality bankable projects, de-risk them and actually make sure it happens,” Adesina added.
On the first day of the Forum, a report dubbed Infrastructure Financing Trends in Africa 2017 was published, showing a 22% rise in funding commitments to the continent’s infrastructure development – from $66.9B in 2016 to $81.6B in 2017.
The report, by the Infrastructure Consortium of Africa (ICA), indicates that the main factors behind the growth include a $13B increase in identified Chinese commitments and a $3.7B increase in African government spending.
Of the financial commitments received by the continent in 2017, West Africa received $22B of commitments, followed by North Africa (US$15.9B), East Africa (US$15.8B), Southern Africa (US$12.2B), South Africa (US$8.7B) and Central Africa (US$6B).
The inaugural Africa Investment Forum winds up on Friday, 9 November 2018.