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April 12, 2015

China-Africa in the news: Loan deals, a damning report, and peacekeepers for S. Sudan

The recent visits to China by the Zambia and Uganda Presidents resulted in a number of several deals that will see the Chinese government and companies investing in the two countries. Edward Lungu and Yoweri Museveni were in China for the Boao Forum for Asia (BFA) annual conference 2015, the only two African leaders at the summit.

While in China, Mr Lungu signed a $65 million loan deal to "initiate and fund the second phase of the national mobile phone tower construction project". Additionally, the Chinese government committed $90 million towards the expansion of Lusaka's Levy Mwanawasa hospital from 120 to 1000 beds. The deal will also see the hospital acquire specialized equipment. The Zambian leader also witnessed the signing of deals worth $800 million between the Zambia-China Economic and Trade Cooperation Zone and 11 Chinese mainland companies. The companies, according to a China Daily report, “will develop projects covering infrastructure, manufacturing, agriculture, tourism, logistics and alternative energy in Zambia.” Lungu also held meetings with executives at the telecom equipment giants, Huawei and ZTE, while in China.

Meanwhile, Uganda's Yoweri Museveni signed loans deals worth $4 billion during the visit. The loans will finance railway and fibre optic cables, among others. There have been concerns, though, about Uganda’s growing debt bill to China: a Ugandan MP recently raised concern about the “new expensive loans” the country has signed with China.

So this explains the growing debt accounts? A paper by two researchers at the University of Sussex finds a strong correlation between state-sanctioned political violence and Chinese aid, a correlation they say is not present with aid received from the West and other traditional donors (World Bank, IMF). This is because of the lack of conditions on the aid, leaving state actors to do as they wish. The Mail and Guardian has a detailed report about the paper and its assertions.

Work starts on Namibia port. China Harbour and Engineering Company (CHEC) started work on a new port in Namibia, five kilometres north of Walvis Bay. The Southern Africa Development Community Gateway port will facilitate the export of commodities and the importation of fuel for countries in southern Africa. CHEC started construction on an access road and a camp expected to accommodate 3000 workers. The company will then "embark on the construction of two tanker berths to replace the old ones that have been in use for more than 50 years" once it completes work on the access road. Bloomberg did a comprehensive report on the project last September.

More Chinese soldiers deployed to South Sudan. 130 Chinese soldiers arrived in South Sudan to join 570 of their colleagues as part of the United Nations (UN) peacekeeping mission. The group is the last batch of "China's first deployment of a full infantry battalion" for a UN mission. They will "focus on protecting civilians as well as UN personnel and facilities." The deployment marks a departure from China's professed policy of noninterference, according to observers.

Chinese among foreigners deported by Kenya over organised crime. Forty foreigners have been deported by the Kenya government over the past two weeks over alleged links to organised crime. Two of those deported were Chinese nationals. They were "said to be financiers of the illegal ivory trade and source for processed ivory" trafficked from Kenya to China and East Asia.

From Mozambique to China, through Australia. Triton Minerals, an Australian Mining Company, signed a contract with Chinese company Yichang Xincheng Graphite Co. (YXGC) to supply graphite mined in Mozambique to China for 20 years. The contract's 'minimum value' is $2 billion.

South Africa signs a currency swap agreement with China. South Africa's Central Bank signed a $4.75 billion three-year bilateral currency swap agreement with its Chinese counterpart, the People's Bank of China. Reuters quoted a statement released by the bank: "The purpose of the agreement is to support trade and investment between South Africa and China, and also to act as a mitigating resource for short term balance of payment pressures."

Uganda kingdom partners with Chinese firm to build houses. Buganda Kingdom in Uganda unveiled a $65 million housing project it is undertaking with Henan Guoji Industry Group, a Chinese real estate developer. The project is expected to produce 220 housing units.

Fellowship for African female tech entrepreneurs. Huawei and She.Leads.Africa are receiving applications for a fellowship targeting African female tech entrepreneurs. The fellows will "receive a behind the scenes experience at the technology giant." Applications close on 30 April. More information on the fellowship and application requirements here.

Raymond Mpubani, Wits China Africa Reporting Project

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