The Trump administration recently launched a new Africa policy to counter the ‘predatory’ practices of Russia and China, but many experts in the region say the US is too late to the game.
The clicks of camera shutters intensified as Chinese President President Xi Jinping welcomed African leaders and exchanged handshakes at a major China-Africa summit in Beijing last September.
At the two-day 2018 Beijing Summit staged by the Forum on China Africa Cooperation (or FOCAC), only Swaziland, out of 54 African countries, was absent, due to its continued diplomatic relations with Taiwan. This means Beijing hosted the biggest ever gathering of African heads of state abroad, and it is, perhaps, a pointer to China’s growing influence in the continent.
Africans are clamouring for more infrastructure, better healthcare facilities, good roads, quality education, and more importantly, jobs for its ever-rising population, estimated to hit 2.5 billion by 2050.
African leaders know this, and the lure of Chinese development assistance and loans cannot be ignored.
The effect of this relationship is manifest in the wave of roads, electricity dams, railways, airports, fiber-optic cables, stadia, ports, high-rise buildings and factories built by China across the continent.
From 2000 to 2017, Chinese loans -- from the government, banks and contractors -- to African governments and state-owned entities totalled $143 billion, according to the latest data from the China-Africa Research Initiative at the Johns Hopkins University School of Advanced International Studies in Washington.
Even the African Union headquarters in Ethiopia was built by China.
But China is not alone.
Russia has been making moves to expand its footprint in Africa -- providing military support to the Central African Republic’s security forces, negotiating arms sales and military cooperation deals and now plans are underway to build a logistics base in Eritrea.
All of these ties trouble the United States, or at the very least, the US can no longer ignore this threat.
President Donald Trump has often touted his America First policy since his ascendency to office two years ago. His immigration policies, the reduction in funding for peacekeeping missions and the UN Population Fund, as well as the country’s withdrawal from the UN Human Rights Council, UNESCO, and the Paris climate change agreement, have made his stance even clearer.
And for Africa, all the signs are there.
Trump’s travel ban targeted people from several Muslim-majority countries, including some African countries, and South Africa and Egypt became victims of his protective tariffs on steel and aluminium. In January 2018, he reportedly described African states as ‘shitholes’. And it took his administration about 18 months to appoint an assistant secretary of state for African affairs at the Department of State.
The majority of the US focus under the Trump administration tilts towards security and countering terrorism in Africa, with some 7,200 troops spread across the region, mostly offering training to partner security forces.
This opened a gap in Africa, with a need for loans and more assistance, and China stepped in.
Since then, China has not only grown to become Africa's top trading partner, but has also expanded its military footprint in the continent, as did Russia. China’s first overseas peacekeeping mission was in South Sudan in December 2015, and in August 2017, it opened its first overseas military base in Djibouti, on the Horn of Africa, a few miles away from a US base.
But a new National Defense Strategy, unveiled in January last year, has seen America move slightly away from fighting terrorism towards a more focused ‘great power competition’ with China and Russia.
“The Trump administration’s narrative about great power competition in Africa is contrived and does nothing to advance US strategic interests on the continent,” Matthew T. Page, a former State Department official and associate fellow at Chatham House, told TRT World.
“It ignores the nuances and complexities of Chinese engagement in Africa while also infantilising African countries by disregarding their own agency and sovereignty,” he added.
Xi doesn’t seem to care much. His multi-billion dollar Belt And Road initiative, launched in 2013, is aiming to create a network of land and sea links, increasing trade between across 70 countries in Asia, Africa, Europe.
And at the 2018 Beijing gathering of African leaders, he pledged $60 billion in aid and loans to Africa alone in the next three years, a similar amount to that offered at the last 2015 summit in South Africa.
As the US shifts its focus to engage China and Russia, the number of its troops in Africa will be reduced by about 10 percent, according to the Department of Defense. Some 700 soldiers providing counterterrorism training will be re-deployed over the next few years.
To address threats from China especially, Trump’s administration has been taking a couple of massive steps, starting with the Better Utilization of Investments Leading to Development (BUILD) Act, which he signed into law last October.
The BUILD Act, which had strong bipartisan backing, would create a new agency, the US International Development Finance Corp (IDFC). This would merge with the Overseas Private Investment Corporation (OPIC) and the Development Credit Authority (DCA), which supports the US Agency for International Development (USAID) and its development goals with credit assistance.
Both are important bodies and they shape how the US mobilises its development finance tools to help emerging markets. OPIC is a major development finance agency that encourages US companies to invest in developing countries in places such as Africa, which has the second largest share of the agency’s pool of investments (28 percent), only surpassed by Latin America and the Caribbean (around 40 percent).
The US remains the continent’s largest investor with some $54 billion of foreign direct investment stock. This new agency can make the most of this huge investment portfolio to expand America’s commercial ties with Africa.
The US has often accused China of overburdening developing countries with debt, what officials call ‘debt trap diplomacy’, to characterise the loss of important national assets for failing to pay back loans. Some 20 percent of African government external debt is owed to China alone, compared to about 32 percent of external debt owed to private lenders, and 35 percent to multilateral institutions such as the World Bank.
With the new IDFC, the US wants to provide an alternative to the Chinese model of state-direct lending, with advanced private sector-driven investment in developing countries, alongside US foreign policy objectives and its national security interests.
In fact, the BUILD Act raised the spending limit of IDFC investments to $60 billion, twice the $29 billion funding cap for OPIC.
The new development finance agency can make equity investments of up to 20 percent, provide insurance and technical assistance, make loans or loan guarantees using local currency, and manage special projects. Allowing the IDFC to make equity investments gives it more power to fight off the Chinese government’s funds, which also take ownership stakes, analysts say.
The IDFC would provide small grants to enable small and medium-sized enterprises, or SMEs, to grow. Chinese loans barely support lending to SMEs.
“While the US is returning to Africa late in the game, it must be noted that among the general populace, it still retains significant goodwill in major parts of Africa compared to its adversaries,” said Damimola Olawuyi of SBM Intelligence, a Lagos-based geopolitical consultancy firm.
“The continent can be seen as a staging base for global competition and great powers will want to disperse resources there before deploying them against adversaries,” he added.
The US strategy to win hearts and minds while advancing its foreign policy goals in Africa doesn’t end with the new agency. And as the Chinese government comes under scrutiny for a lack of transparency with project details and Chinese companies face accusations of labour and environmental violations, gaps to exploit remain.
On December 13, at the Washington-based think tank Heritage Foundation, John R. Bolton, Trump’s national security adviser, outlined the administration’s new strategy for Africa. Again, at the heart of the strategy is a ploy to counter Russian and Chinese influence, which Bolton did not gloss over.
The new strategy would, he told the audience, focus on promoting trade and commercial ties, countering terrorism and violent conflict, and providing foreign aid “efficiently and effectively.”
A new initiative Prosper Africa, would be implemented to support US investment across Africa, increase the continent’s middle class and improve business environments in the region, he said. Bolton did not say how many dollars would be poured into the programme.
“America’s vision for the region is one of independence, self-reliance, and growth—not dependency, domination, and debt,” he added.
A day before Bolton’s address, USAID had unveiled its first-ever Private Sector Engagement Policy, which is largely enterprise-driven as part of efforts to further promote the US’s commercial engagement in Africa.
“America has commercial interest, investment interests, and investment relationships in the developing world; that's a fundamental difference,” USAID Administrator Ambassador Mark Green said at the American Enterprise Institute in Washington, perhaps the best place to discuss a changing development finance strategy.
However, Page does not think it is time to start celebrating yet. The next few months would show, he said, whether Trump’s Africa policy takes “flight or stalls mid-air.”
And even following the US national security adviser’s speech, he called for caution.
“Bolton’s speech should not be interpreted as a sudden shift or renewed interest in Africa among senior administration officials,” Page explained.
“Whether it constitutes more than a box-checking exercise remains to be seen. Will we see concrete changes in existing policy? Will new initiatives be funded and implemented on the ground? Will Trump send [US Secretary of State Mike] Pompeo or Bolton to the continent to undertake substantive policy discussions with key African leaders?”