China’s Race To The Bottom In Africa

BY CHRIS SMITH

(THE HILL)--Chinese President Xi Jinping recently began a multi-country tour of sub-Saharan Africa looking to expand his country’s influence on the continent. The trip came amidst increasing concerns about shoddy construction of infrastructure, rapidly rising levels of debt of African countries, and corrupt autocrats benefitting from foreign investment.

These seemingly separated developments are in fact interrelated, as China’s presence in Africa is raising alarm bells for those who fight for human rights, democratic freedoms for all, and fiscal accountability.

China may offer African governments many attractive short-term incentives for partnerships, but the long-term goal of Beijing remains to maximize its own interests in the region. At a hearing of the House Foreign Affairs Africa Subcommittee that I chaired in March, experts testified that as China offers collaboration with African countries, the abuses that we see regularly in China—human rights violations, repression of civil society, lack of transparency and accountability—are also gripping the region.

This is no accident. The communist regime—one that still reveres Mao Zedong, whose motto was “Political power grows out of the barrel of a gun”—cannot be “normalized.”

The Chinese Communist Party has organized political party training exercises with authoritarian countries in Africa, even going as far as bringing students to Beijing. As the Brookings Institution has documented, officials from the ruling party of Ethiopia are “taught comprehensively how to manage their own organizational structure, ideological work, propaganda system, [and] cadre education” by China’s finest communist experts. Recent improvements notwithstanding, it is no coincidence that Ethiopia has become one of the most repressive regimes on the continent.

African indebtedness to China is another distressing development. While Africa needs foreign investment to fill its infrastructure gap, more countries are accumulating risky debt burdens. In Djibouti, for example, a strategically important country in the Horn of Africa with China’s only overseas military base, the country’s debt to China is approaching 90 percent of GDP.

And while China has been investing in African public works projects, these projects have been riddled with dangerous mismanagement and corruption.

In June of 2017, a $12 million Chinese-built bridge in Kenya collapsed even before it opened. Last August, a former Guinean mining minister was convicted of laundering $8.5 million that he received in bribes to help China International Fund Ltd. win exclusive rights to mine Guinea’s iron, gold, diamonds and bauxite deposits. This corruption enriched a handful of Guineans to the detriment of the whole country.

It is far better for African countries when foreign investors are held to high ethical standards of transparency and accountability. They need investors who are ready to provide superior products and services to the African people in a transparent and responsible way.

For instance, the U.S.-based General Electric Company is successfully working with African countries to bolster their power infrastructure. In Ghana, over 70 percent of the country’s thermal power is run by GE technology. GE, like all U.S. corporations, is bound by the Foreign Corrupt Practices Act, which ensures minimum business practices. China, as you might guess, has no such law to curb corrupt deals.

China also uses foreign aid as a bargaining chip in corrupt African countries with plenty of natural resources for them to exploit. AidData, a research laboratory at the College of William and Mary, argued in written testimony submitted to my committee that China effectively buys the votes of African governments at the United Nations; they concluded that if African countries voted with China at the UN an extra 10 percent of the time, they would receive an 86 percent bump in assistance.

Ultimately, China intends to replace the U.S. dollar with the yuan as the world’s reserve currency; central bankers and officials from 14 African nations recently discussed the viability of using China’s yuan as a reserve currency for the region. China also recently signed a multibillion dollar currency swap agreement with Nigeria that allows both countries to bypass dollars in bilateral trade.

The potential consequences of this monetary attack—if left unchecked—would be disastrous to the global financial order. In order for the U.S. to hold gross human rights abusers accountable through sanctions, there must be a global financial system based on the U.S. dollar. Currency swaps like that between China and Nigeria enable both China and participating African countries to skirt international sanctions for any gross human rights abuses.

All of these trends—rising levels of debt, shoddy infrastructure projects, and investment that permits human rights abusers to consolidate their influence and power—point to serious risks for the future of the African continent.

The U.S. must not give up on the people of Africa. We must continue to promote democracy, good governance and the rule of law, investing in infrastructure and providing aid on a truly humanitarian basis. If we fail, China will spread its bad governance model throughout Africa—at the expense of the African people and, likely, beyond.

Smith is chairman of the Foreign Affairs Subcommittee on Africa.