Beijing finds itself cornered by African countries as they cancel China-led projects
Sep 21, 2021
Beijing [China], September 21 : China is increasingly finding itself being cornered by African countries on investment-related matters with several of them cancelling their contracts with Chinese companies, according to a media report.
The Singapore Post in an article on Monday said some of the countries had cancelled contracts as the "shoddy" work of the Chinese companies had become a source of tension for the ruling dispensations in several nations across the African continent.
After Ghana cancelled the contract of the Beijing Everyway Traffic and Lighting Tech company, which was to develop an intelligent traffic management system for the country, President of the Democratic Republic of Congo (DRC) Felix Tshisekedi called for a review of mining contracts previously signed with China in 2008, the publication said.
The DRC President said he wants to get fairer deals for his country. Unhappy with China's exploitative tendency, he said, "Those with whom his country signed contracts are getting richer while DRC people remain poor."
In 2008, then Congo President Joseph Kabila, who was in power from 2001 to 2019, signed deals with Chinese state-backed firms Sinohydro Corp and China Railway Group. Under the agreement, these Chinese companies were to build roads, hospitals and bridges in the Democratic Republic of Congo in exchange for a 68 per cent stake in the country's Sicomines venture, The Singapore Post reported.
According to the publication, lack of transparency was the issue that shrouded the China-led projects in Congo.
Ghana government cancelled the project because they found Everyway Traffic and Lightening Tech's work not up to any satisfaction and cancelled the project outright.
Last year in July, a Kenyan High Court ordered the cancellation of a USD 3.2 billion contract between Kenya and China for the construction of the Standard Gauge Railway. The court termed the whole project "illegal", stating the state-run Kenya railways failed to comply with the country's law in the procurement of the Standard Gauge Railway.
According to the John Hopkins University School of Advanced International Studies' China-Africa Research Initiative, between 2000 to 2019, China signed 1,141 loan commitments worth USD 153 billion with the African government and their state-owned enterprises, The Singapore Post reported.
The publication said that such whopping loan amounts have become unbearable for poor African countries. Moreover, on account of the Covid-19 pandemic and its impact on the economy, several African countries have found it tough to service loans they have taken from China. Hence, with limited choice to manage debt burdens, African countries have preferred to suspend projects which are controversial or cut sorry figures on the accountability front.
Meanwhile, most of the Chinese projects getting scrapped in Africa are part of Beijing's ambitious Belt and Road Initiative and this is what worries Chinese authorities, The Singapore Post reported.
Initiated in 2013, the BRI is Xi Jinping's grand plan to connect Asia with Africa and Europe via land and maritime trade networks to create new routes for China.
