In a historic bid to cement ties with Africa, Chinese President Xi Jinping said on Thursday that China would provide close to $51 billion in fresh funding for the continent. Besides that, China is promising to create at least 1 million jobs across Africa-a massive sign by Beijing of its commitment to boosting economic and infrastructural development on the world's fastest-growing continent.
This pledge comes at a time when Africa is seeking greater foreign investment to develop its infrastructure, grow its workforce, and achieve economic integration. Inasmuch as China has already emerged as one of Africa's largest trading partners and a major source of development finance, the new investment represents a serious ramping up of their existing partnership.
Focus Shifts to Green Technologies and Sustainable Development
The most striking aspect of the latest funding drive is that China has moved away from a big-ticket infrastructure to advanced technologies and sustainability. As President Xi underlined, the world's second-largest economy would move away from just funding big-ticket infrastructures and instead would be focused on selling green and innovative technologies to developing economies around the world, especially in Africa.
The Chinese invest in practically all different advanced technologies, from clean energy solutions through electrical vehicles to telecommunications infrastructure. Many such technologies are appropriate for the current development needs of Africa. This whole continent is full of renewable energies such as solar and wind, and the introduction of Chinese technology may accelerate the green energy transition that will be needed on the African continent. In doing so, China opens new markets for its technology companies, which have become world leaders in solar energy and telecommunications, among other fields.
This is the pivot in a bid by China to go green globally-to reduce carbon emissions and persuade other countries to embark on the same path. In recent years, China has risen to become one of the leaders in the world in the production of clean energy, especially in green technologies exported to Africa that have the potential to help the African continent overcome some of its daunting environmental challenges such as energy insecurity and deforestation.
**Learn more about China's renewable energy investments at: https://www.csis.org/analysis/chinas-renewable-energy-development-africa
Infrastructure Still a Core Priority
Notwithstanding this trend of going green, infrastructure development remains one of the key drivers of China's engagement in Africa. President Xi announced that China was set to undertake 30 new infrastructure projects across the continent, which will be funded through the 360 billion yuan ($50.7 billion) financial assistance package. The projects will improve key sectors like transportation, energy, and telecommunication.
As the infrastructure gap in Africa has become one of the most significant barriers to economic development, support from China has gone a long way in addressing this gap. Most African countries lack the roads, bridges, and railway networks that would see goods and people move efficiently. China has played a major role in the construction of such infrastructure projects, including the funding of Kenya's Standard Gauge Railway and Ethiopia's Grand Renaissance Dam. These projects have gone a long way in integrating the markets in Africa, reducing transportation costs, and increasing access to electricity.
With these new projects, China will continue to lead in shaping Africa's infrastructure landscape. These various road, rail, and energy projects form a base for industrialization, urbanization, and trade within and across the African continent.
Read more about Chinas infrastructure projects in Africa
Creating Jobs and Economic Opportunities
Perhaps one of the most significant components of China's new funding pledge is the promise to create 1 million jobs in Africa. This is an opportunity for the demographic dividend at a time when the African continent is one of the youngest, with more than 60 percent of its population below the age of 25. Therefore, job creation becomes an important means of realizing this potential and harnessing the potential service of young Africans as active contributors to economic development.
Chinese companies operating in Africa have already created thousands of jobs in such industries as manufacturing, telecommunications, and construction. Yet, because it is in the process of shifting toward technology and green industries, many of those new jobs will fall within high-tech and sustainable industrial lines of work, affording African laborers a chance to pick up valuable skills and expertise.
This is further complimented by the involvement of China in the education sector in Africa through various scholarship and training programs, which have been equipping the next generation of African professionals to thrive in a globalized economy. In turn, these 1 million jobs being created will deepen China-Africa economic ties even further, with the added benefit of addressing one of the hottest challenges facing the African continent: youth unemployment.
Read: How is China bringing jobs to Africa?
On the Horizon: Issues of Market Access and Trade Barriers
Hurdles persist, particularly with respect to market access, despite China's ambitious plans for Africa. African exporters have been having an uphill battle with China's strict phytosanitary regulations-that is, rules in order to protect human and animal life, as well as plants, from pests and diseases. This severely limits the chances for African agriculture products to enter the great Chinese market and, consequently, the economic benefits of trade between these two regions.
Analysts observe that as China continues to express its interest in the deepening of trade relations with Africa, overcoming these regulatory hurdles will be decisive in the ability to realize those promises. Agriculture is at the core of many African economies, and even greater access to China's huge consumer market could rake in more export revenue for them. But trade barriers in both China and Africa stand in the way of fully exploiting the opportunities opened up to them by China's market.
Some African leaders have encouraged China to ease its phytosanitary standards and create a level playing field for African exporters. It remains to be seen whether these trade barriers will be resolved, but they will no doubt play a critical role in determining the future of Sino-African economic relations.
Learn more about Africa's trade challenges with China
China's Role in Africa's Economic Future
With China's further expansion of influence in Africa, China is indispensable in shaping the economic future of the continent. The new $51 billion in funding represents the continuum of China's long-standing commitment to Africa, built upon two decades of trade, investment, and infrastructure development. Given its position as the largest two-way lender in the world, China's role in financing key projects in Africa-from highways to power plants-is very significant.
Nonetheless, this shift in focus toward green technologies and job creation does signal a turning point in the nature of the Sino-African relationship. Whereas infrastructure development was key, China now pursues greater economic integration and technological exchange with Africa. This might have long-term effects on industrialization in the continent, attracting foreign investment, and integrating into the global economy.
Consequently, at the same time, African countries need to work their way through such opportunities and challenges. Inasmuch as China is already re-evaluating its investments in Africa, there needs to be consideration on the part of its leadership for these partnerships to be mutual and developmental if they are to be long-sustained.
Conclusion
China's pledge of funding to the tune of $51 billion and a promise of 1 million jobs thus becomes a milestone in this evolving relationship with Africa. This is done by putting much emphasis on green technologies, infrastructure development, and the creation of jobs, making China an indispensable partner in the development of Africa. However, there are a number of factors that need to be addressed, including market access and trade barriers, for this partnership to realize its full potential. As Africa continues to grow and develop, her relationship with China will no doubt shape the future ahead.
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