Belt & Road Initiative (BRI)

in AFRICA (Costs and Benefits)

 What is BRI?
 BRI in African Countries
 Costs and Benefits of BRI in Africa
 Benefits of China from BRI
 Benefits of Africa from BRI
 Costs of BRI
 Conclusion
Presented by
Group 3
 Group Members

MDevS (II) – 4 Myo Thwin Hnin

MDevS (II) – 8 Ei Ei Khine

MDevS (II) – 13 Go Khan Ciin

MDevS (II) – 30 Pyae Phyo

MDevS (II) – 44 S Hlaing Win

2
 What is BRI?

• The Belt and Road Initiative (BRI) is China’s main international cooperation and
economic strategy. The BRI is also known as the “One Belt One Road” (OBOR),
the “Silk Road Economic Belt and the 21st-century Maritime Silk Road” or just
the “New Silk Road”.

• Belt and Road Initiative (BRI) is a strategy to connect Asia with Africa and
Europe via land and maritime networks with the aim of improving regional
integration, increasing trade and stimulating economic growth.
BRI in AFRICA
• Over the last two decades, China has established a significant economic presence in
most African countries.
• China has made significant inroads into Africa under the BRI.
• A lot of China’s investment into Africa, and lending to African nations, had in fact
occurred by the time BRI was announced in 2013.
• According to China’s official statistics, 49 of the 54 countries (i.e. 8 over 90 percent)
have already signed MoUs.
• Geographically, 22 of the 49 countries (nearly 50 percent) are located in West
Africa, with East Africa (12), North Africa (nine) and Southern Africa (six)
comprising the other 50 percent.
• The African Union has also signed a Memorandum of Understanding (MoU) on
BRI cooperation with China.
• South Africa (2015), Egypt (2016), Angola, Kenya, Tanzania are the first five
countries from Africa which joined the initiative.
BRI in AFRICA
 Many African countries are implementing BRI projects but classical examples from
Uganda, Kenya and Djibout give a clue of what is going on.
 In Uganda, the construction of the Kampala-Entebbe Expressway-49.56, Karuma and
Isimba hydropower dams as well as the ongoing expansion of the Entebbe
International Airport.
 In Kenya, the Mombasa-Nairobi Standard Gauge Railway (SGR), 472 km long railway
cost about USD 3.8 billion (90 per cent of which was funded by Chinese loans) was
constructed.
 Other notable projects under the BRI were Lamu Port-South Sudan- Ethiopia
Transport (LAPSSET) Corridor, Nairobi Expressway, Likoni Floating Bridge, and the
Makupa Bridge.
 China has become more involved in Djibouti’s economic development and
infrastructure projects, including the construction of a new port and a railway
connecting Djibouti to Ethiopia. Djibouti is home to China’s first overseas military
base, established in 2017, reflecting the growing strategic importance of Djibouti to
China’s interests in the country and Africa.
BRI in AFRICA
 The game-changer projects have been, for example, the construction of Doraleh
Multi- Purpose Port which started in 2004 and was completed in 2017, by China
State Construction Engineering Corporation (CSCEC) and under the supervision of
CCCC Fourth Harbor Engineering Co., Ltd and the Addis Ababa-Djibouti Railway
construction of which began in 2011 and which was completed in 2016.
 The expansion of Djibouti’s international airport project started in 2015 and was
completed in 2018.
 There are only five African countries— Eritrea, Benin, Mali, Sao Tome and Principe
and Eswatini (Swaziland)—that have neither signed an MoU nor expressed support.
 However, China continues to push its presence in these countries undeterred.
 Benefits & Costs of BRI in Africa
China has made significant inroads into Africa under the BRI.
The African Union has signed MoU on BRI cooperation with China.
Five significant trends emerge from China’s BRI projects in Africa.
Benefits of China
Firstly;
• China is investing in ports and port areas along the coastline from the Gulf of Aden
through the Suez Canal towards the Mediterranean Sea.
• These include Djibouti Port, Port Sudan, Port Said-Port Tewfik (Egypt), Port Ain
Sokhna (Egypt), Zarzis Port (Tunisia) and El Hamdania Port (Algeria).
 The People’s Liberation Army (PLA) Navy has built its first overseas military
base in Djibouti, which has been in use since 2017.
 China could use its influence over these ports for economic and military

purposes in the future.

Secondly;
 China is using its connectivity projects to link its industrial and energy

projects in the hinterland of Africa to the infrastructure projects along the

African coastline.
 This enables China to use the maritime route to transport raw materials

As a 3rd fact;
 While the majority of China’s projects in Africa are in the infrastructure

sector, Chinese companies are beneficial from dealing with overcapacity in key
sectors such as steel, iron and cement.
Fourthly,
 China has been successful in building transnational projects in Africa only where
there is either a deficit or vacuum in strong governance across countries.
Benefits for Africa
 Trade growth and job creation are perhaps the most salient.
 Over the past two decades, China has grown from a small investor to the
continent’s most significant economic partner.
 Since 2000, trade with China has been growing at roughly 20 percent per year, and
Chinese direct investment has been increasing at 40 percent per year.
 China has subsequently increased primary resource imports from Africa, while
Africa has imported manufactured goods from China in exchange.
 In 2013, China became Africa’s leading export and development partner overtaking
Europe as the largest trade partner.
 Infrastructure projects have been a source of employment as they help promote
higher productivity in the regions.
 There is ample scope for Africa to benefit from Digital Silk Road (DSR).
 Huawei has not only built a majority of the 4G networks constructed in Africa but in
July 2020 launched the continent’s first commercial stand-alone 5G network.
 Chinese businesses have worked on many other aspects of Africa’s digital
infrastructure, such as data centers, smart traffic solutions and security systems, and
Chinese providers dominate the market for smartphones and other phones.
 Costs
Political Risks
 At least a dozen incidents of kidnapping and harassment of Chinese workers
working on projects across Africa
 In Nigeria, local protests erupted in April 2017 over the lack of compensation for
buildings demolished for the construction of the Lagos-Ibadan Railway Line.
 Ghana’s Environmental Justice Foundation has launched an investigation over
claims by the Ghanaian fishing community that 90 percent of its fleet is now
owned by Chinese entities.
 In Chad, residents have protested against Chinese presence, which is
accompanied by few jobs, low pay and harsh working conditions.
Second Cost
 Growing concerns amongst African countries over a rising debt trap
 The public debt in Sub-Saharan Africa has risen from 34% in 2013 to 53% in 2017.
 China has provided 30 % of Ethiopia’s total new public external debt over the past
five years and 90 % of new bilateral debt.
 In 2 years, Djibouti’s public external debt has increased from 50% to 85% of its
GDP, which is the highest for any low-income country. Much of this debt consists of
government-guaranteed public enterprise debt and is owed to the China Exim Bank.
 Zambia has also raised concerns over China’s debt trap as well as the Zambian
government’s ability to service its existing debt, considering the slump in the price of
its leading export, copper.
Third Cost
 The cancellation or postponement of major projects by African Governments
 In February 2018, the Zambian government revoked a Chinese company’s
license to operate coal mines due to poor safety and environmental compliance.
 The Niger government is revising a contract against State-owned China
National Petroleum Corporation (CNPC) on bloated costs and unfair charges.
 The Ugandan government has postponed the construction of the Kampala–
Entebbe Expressway after the Opposition party raised concerns over the rising
debt trap.
 The Sierra Leone government has cancelled the US$ 318 million Mamamah
International Airport Project under the BRI.
 Conclusion
 China claims that Belt and Road Initiative is a “win-win cooperation” model in
its economic investments abroad.
 Nevertheless, in most cases in Africa, it appears to be benefiting more from its
investments compared to the host countries.
 The Chinese investments in ports along the East coast and the first Chinese
military base in Djibouti have fuelled these concerns.
 There are also various instances of protests and cancellation or postponement of
Chinese projects over lack of local employment opportunities, rising debt
concerns, and violation of quality standards or incidents of malpractice on the
ground.
 So far, the BRI remains a largely unilateral Chinese exercise, with only a few
instances of collaboration with third-party countries in Africa.
 References
(1) Opportunities and Risks for Africa’s Connectivity by Nancy Muthoni
Githaiga, Alfred Burimaso, Wang Bing and Salum Mohammed Ahmed
(2) Belt and Road Initiative; The view from Africa (2021) by CMS (law, tax,
future)
(3) The role of Africa in China’s Belt & Road initiative by Julia Breuer July 2017
(4) China’s Belt and Road Initiative: Implications in Africa by
VENKATESWARAN LOKANATHAN, August 2020
(5) Understanding China’s Belt and Road Infrastructure Projects in Africa by
David Dollar, September 2019
(6) https://dailynews.co.tz/benefits-from-bri-to-trigger-africas-sustainable-
development/
Thank You