China Investing in Africa’s Future, Why Isn’t the US?
January 5, 2019
In the article below you can read about China’s strategic investment in making Djibouti’s port a major port in Africa and the Middle East. The West can criticize as much as it likes, but China, not the US and Europe, is building vitally needed infrastructure in Africa. Without infrastructure Africa will not develop and progress. U.S policy known as “Prosper Africa” is cynical joke.
In strategic Djibouti, a microcosm of China’s growing foothold in Africa
December 30, 2019
Excerpts:
DJIBOUTI — Above ground in this tiny but strategically located country, signs of China’s presence are everywhere.
“Yes, our debt to China is 71% of our GDP, but we needed that infrastructure,” Mahamoud Ali Youssouf, Djibouti’s foreign affairs minister, said in a phone interview on the sidelines of a meeting in New York earlier this month, where Djibouti was pushing to gain a non permanent seat on the United Nations Security Council.
“It was quite natural that we raise our partnership with China. Neither Europe nor America were ready to build the infrastructure we needed. We’re projecting our country into the future and looking after the well-being of our people. Even the United States has trillions of dollars in debt to China, you know,” Youssouf said.
The most significant investment China has made in Djibouti is Doraleh Port, Africa’s biggest and deepest. As with Internet through the data center, a full 90 percent of landlocked Ethiopia’s imports now transit Djibouti, giving the minuscule country, with a population of less than a million, leverage over its gigantic, 100-million-strong neighbor.
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Can IGAD Achieve Peace Without Economic Development?
By Mekki ELMOGRABI
Could the endless search for peace be a trap? Yes, because “sustainable peace objectives with high standards of security and stability” is the bait that entices stakeholders to ignore the need for private sector development and regional economic integration until peace is achieved.
“We hear questions like peace through development! The maxim is good in theory but in reality, political peace is touted at the cost of economic integration. I no longer believe in everlasting peace as a condition to development or economic growth. In a simple economy, market people could pay to build a police station to increase security in border areas. IGAD, in the meantime, when it is not preoccupied with the “peace trap” it can advise governments on how to allocate the taxes from borders markets to local roads and how to create security in the area. Feasibly, IGAD and AU can hold peace talks and workshops at borders to promote markets and countryside African resorts rather than five-star hotels in the cities.”
Read: IGAD and Peace Trap!
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Nations Must Study Alexander Hamilton’s Principles of Political Economy
Match 28, 2019
Hamilton Versus Wall Street: The Core Principles Of the American System of Economics By Nancy Bradeen Spannaus
A Review by Lawrence Freeman-March 28 2019
For those followers of our beloved Alexander Hamilton and for those new to his writings, this book is for you. Nancy Spannaus, in her just-released book Hamilton Versus Wall Street, makes a unique contribution to the existing volumes written on Hamilton’s political and economic thoughts. In her relatively short easy-to-read book, she weaves together Hamilton’s revolutionary ideas on political economy that served as the pillars for the creation of the United States, their legacy in the next two centuries of America, and their influence internationally. Throughout her treatise, Spannaus also provides constructive historical analysis of the battle inside the United States to adopt Hamilton’s concepts. This book is a valuable complement to Hamilton’s economic reports and will aid those unfamiliar with his seminal texts. *
Spannaus polemically begins by countering the popular myth that Hamilton was an agent for the banks (Wall Street) against the interests of the “little man,” agrarian society and the states, as espoused by Thomas Jefferson and others. She later devotes entire chapters to Hamilton’s opposition to the British central banking system and Adam Smith, exposing another slander which alleged Hamilton was a supporter of the British aristocracy.
Principles of Political Economy
Unlike like other publications on Hamilton that gloss over or give insufficient attention to Hamilton’s ground-breaking concepts of banking, credit, and manufactures, Spannaus makes a great effort to elaborate Hamilton’s contributions to: “The Core Principles of the American System of Economics.” **
All nations would benefit greatly, if their leaders and citizens studied Hamilton writings. American culture would not be at the low level it is today, if my fellow citizens had been taught Hamilton’s economic theories, which in fact were crucial to the creation of our nation from thirteen indebted, agriculturally-based colonies. Advanced sector countries that are dominated by financial systems dictated by Wall Street and the City of London, and underdeveloped nations that rely on resource extraction and farming, because they lack a manufacturing sector, could learn a great deal from Hamilton.
However, Hamilton’s thinking about economic growth was not limited to the mere production of goods. He understood for society to continually increase the productive powers of the economy, the development of the human mind was essential. Spannaus quotes Hamilton: “To cherish and stimulate the activity of the human mind, by multiplying objects of enterprise, is not among the least considerable of the expedients, by which the wealth of the nations may be promoted.” (p. 28).
Friederich List, a student of Hamilton’s philosophy in the nineteenth century, wrote that “capital of mind, capital of nature, and capital of productive matter” are all essential components to achieve economic progress. (p. 29)
The Constitution and Public Debt-Credit
Hamilton knew that for a nation to be truly sovereign, it must possess the means to produce the physical wealth necessary to maintain the existence of its citizens and their posterity. It is no coincidence that the Founding Fathers embedded this concept in the profound Preamble to the US Constitution. As Spannaus emphasizes, for Hamilton, the importance of establishing federal credit through the creation of the National Bank, stabilizing the currency, developing the manufacturing capability of the young United Sates, and increasing the wealth of the nation through internal improvements, was coherent with the intent of the Preamble “to form a more perfect Union.”
Hamilton used the “general welfare” clause of the Preamble to justify his revolutionary idea to create a public-private National Bank to consolidate the separate states and establish a unified currency to promote national economic growth. Generations later, in the footsteps of Hamilton, Franklin Roosevelt, who studied Hamilton’s writings, would also rely on the “general welfare” clause to garner support for his New Deal and other programs he initiated to revive the U.S. economy wracked by the Great Depression.
Public Credit, anathema today to virtually all Democratic and Republican leaders, was another key concept Hamilton fought for, knowing that private sector funds and privately-owned banks would never adequately fund a nation’s economic growth, especially for large-scale internal improvements, i.e. infrastructure.
To emphasize the unique role of public credit, Spannaus lists four exceptional periods in U.S. history when the efficacious application of government-issued credit led to a pronounced expansion of the American economy. These are administrations of Presidents George Washington, John Quincy Adams, Abraham Lincoln, and Franklin Roosevelt. (p. 55-56)
In chapter 7, the author concisely summarizes Hamilton’s outlook: “…it is the deliberate increasing of the productive powers of labor through technology, improvements in infrastructure, and the use of government power to create credit that will produce value in the economy.” (p.128) This is more than good advice that all public officials. government leaders, and informed citizens should follow to secure a joyful future for their nation.
In Africa and other underdeveloped regions of the world where nations have suffered from hundreds of years of exploitation of their natural resources, Alexander Hamilton’s wise words should be fully grasped: “The intrinsic wealth of a nation is be measured, not by the abundance of the precious metals contained in it, but by the quantity of the productions of its labor and industry.” (emphasis added p. 1)
*Hamilton wrote four major economic reports for Congress and President George Washington between January 1790 and December 1791: Report on Public Credit; Report on a National Bank; Report on Manufactures; and Opinion as to the Constitutionality of the National Bank.
**This is the subtitle of Hamilton Versus Wall Street.
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Nigeria and Sub-Saharan Africa Should NOT Have the Majority of Poor People.
October 24, 2018
This is absolutely unacceptable. There is no objective reason for Nigeria and Sub-Saharan Africa to have the highest percentage of poor people in the world, with all its natural resources and people. This is the result of failed policies that began with the so called “Washington Consensus” beginning in the 1980s. Under the International Monetary Fund’s diktats and Structural Adjustment Programs(SAPs), the economies of African nations were destroyed and many have still not recovered. African nations are beginning to follow a different model in collaboration with China’s Belt and Road Initiative. The IMF and World Bank models which measure statistical monetary aggregates ignore the most essential ingredient necessary to create economic growth: technologically advanced infrastructure platforms, integrating rail, energy, water, and roads. Only in the last ten years is infrastructure finally being built, after it was outlawed under colonialism and neo-colonialism, (except for roads and rail for resource to port and transporting colonial soldiers). For example, the Sudanese people are suffering terribly from a lack of economic growth, because Sudan has been threatened not to deviate from IMF dictated macro-economic parameters. The Sudanese people will rebel, if Sudan continues to adhere to the murderous policies of the so called “free market.”
It is time for African nations to over throw the old model and break free from the monetarist grip of the IMF and WB. Inclusive growth, as it is called, will only happen when there is improvement in the real-physical economy.
It is projected that by 2050 Nigeria will have 400 million people and Africa as a whole 2.4 billion. Despite the hysteria of the “zero-growthers,” Nigeria and Africa are not suffering from over population, but underdevelopment of its vast wealth. Each new human born can be a new source of wealth, if their creative potential is nurtured and developed. Thus, the Africa continent with its projected large population, should become the center development (not poverty) of world economy, if we act now to massively expand infrastructure across the continent.
Read Below:
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A Brief Response: Marshall Plan for Africa or “Debt Trap?”
Lawrence Freeman
September 20, 2018
The world is witnessing an increase in attacks on Africa’s relationships with China in various articles, as well as low-level, unthoughtful, messages on Twitter, Facebook, and YouTube. Not only does that content intend to demonize China as the new colonial empire of Africa, but it also includes vulgar demeaning caricatures of African Heads of State.
Could the reason for the uptick of these kinds of diatribes be related to the successful September 3-4, Forum on China Africa Cooperation (FOCAC) summit in Beijing, attended by leaders from almost every African nation? China has reached out to Arica and formed a special relationship which is being embraced by African Heads of State. It should be clear to any intelligent historian, that China is not acting as an Imperialist manner towards Africa.
However, what has been conspicuously, egregiously omitted from this unsubstantiated vilification of China, is the history of Western nations and institutions, which have acted as an Imperialist power towards Africa. The latest accusation is that China is deliberately entrapping African nations into unpayable debt. However, this is precisely what the IMF, World Bank, Paris Club, along with their allies in the City of London and Wall Street did to Africa immediately following the “Winds of Change.”
The motivation for this propaganda barrage is that China via FOCAC and the Belt & Road Initiative is offering African nations a pathway toward growth uncontrolled by the financial predators in the City of London and Wall Street. Contrary to the myth that China is stealing African resources; which the Western powers did first under slavery, then under colonialism, and have continued under neo-colonialism, China is actually providing credit for physical infrastructure; the sin qua non to spur economic growth.
Debt and Credit for What?
A pervasive and quite serious problem affecting well-intentioned individuals from all corners of the globe is the lack of understanding of what actually creates economic growth. Neither money, nor financial transactions, nor derivatives, nor speculation, nor rising stock markets, nor the market place are the cause of growth or synonymous with real economic growth.
Credits issued for infrastructure; water, energy, rail, roads, healthcare, and education, identifying the most vital categories, if properly organized, leads to an increase in the productivity i.e. the economic power of the society. This is measured by the ability of society to increase its physical output from one production cycle to the next. By utilizing advanced technologies embedded in new capital equipment, including infrastructure, farmers and workers can produce more efficiently. Simply providing abundant energy, high-speed railroads, and water inputs to an African nation would lead to a jump in economic output. Shortly after the death of President Kennedy, the US ceased its commitment to assist Africa nations in expanding their infrastructure.
China is committed to lending, issuing credit-yes creating a debt to fund long-term investment in infrastructure. Credit directed in this way is good debt. With non-usurious interest rates over 15-20 years, the loan can be retired from the profit it generates to society. This form of debt is not equivalent to the hundreds of billions of dollars African nations were forced to pay to the financial capitals of the world for loans to cover rigged terms of trade, and currency devaluations.
If you study the American System of Political Economy with its cornerstone; Alexander Hamilton’s national credit policy, you will realize that China is emulating the best of America’s past. For example, President Franklin Roosevelt, who successfully applied Hamilton’s principle to rebuild the Depression riddled US with state issued credits, would have little trouble understanding the principles of President Xi Jinping’s Belt & Road.
Economics and the Common Good
There is a deeper level to comprehending economic growth. Every human being is united by a universal principle often expressed as the “common good of mankind.” Yes, all human beings regardless of religion, color, ethnicity, or place of birth, share a “common interest.” We are all created with the power of creativity. Not logic, not deduction, not induction, but the power to hypothesis new ideas. The power of discovery, to discern new principles of the universe that we previously did not know but were there waiting to be revealed to the human mind. These scientific discoveries spawn new technologies which are the primary source of economic growth. Thus, it is the responsibility, nay the obligation of every society to nurture and develop that creative potential innate in all its citizens from birth to death.
For all citizens to realize their potential, live productive lives, and raise their families without fear of hunger and security, a nation must have the economic means to expand the total physical wealth of society over succeeding generations. An advanced industrialized nation requires a healthy manufacturing sector, which is also an essential component of a productive agriculture sector. The absence of robust agro-manufacturing economies in Africa is crime along with its huge deficit in infrastructure.
Sadly, the West does not have the vision to assist African nations in overcoming these deficiencies. China in all, but name has launched the equivalent of a Marshall Plan for Africa.
Among the eight major initiatives that President Xi laid out at the Africa-China Summit, China will:
1.Promote industrialization; 2. Support agricultural assistance programs; 3. Work with the African Union (Agenda 2063) to formulate a China-Africa infrastructure cooperation program; 4. Increase its imports from Africa, in particular non-resources products; 5. Train 1,000 high-caliber Africans for training in innovation sectors; provide Africa with 50,000 government scholarships; and sponsor seminar and workshop opportunities for 50,000 Africans and invite 2,000 African students to visit China for exchanges.
China has come to understand that it is the common interest of its own country, and in the fact all nations, is to help Africa develop productive industrialized societies not dependent on revenue from one resource or one crop. Under these improved conditions, hunger and poverty, the underlying causes for conflict, can be eliminated. Great progress can be accomplished in Africa and the world, if the US and Europe acquire the wisdom to join China’s Spirit of the Belt & Road
Below are three articles with excerpts that provide useful background to understanding Africa’s productive relationship with China.
“The recently concluded China-Africa Summit offers a new deal for Africa’s recovery. The Forum for China-Africa Cooperation (FOCAC) has the making of a 21st century equivalent of the Marshall Plan, America’s massive economic rescue programe that President Harry Truman unveiled for Europe on April 3, 1948.
AFRICA’S INDUSTRIALISATION
On its part, China is taking a Pan-African approach targeting projects with regional impact such as Kenya’s standard gauge railway. Like the Marshall Plan that prioritized the reindustrialization of Europe after the war, China is laudably giving a pride of place to Africa’s industrialisation.
Industrialization was top on the list of President Xi Jinping’s eight-point plan to guide Chinese aid to Africa in the next three years. Recipients of Marshall Plan had to invest 60 percent of these funds in industry. The funds also involved Technical Assistance Programes to create a skilled labor force to drive industrialization.” Read: China’s Marshall Plan for Africa-Debt or New Deal ?
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“Speaking as the Chairman of the African Union, President Paul Kagame of Rwanda, expressed the will of Africa very clearly: “Africa wishes to be a full and integral part of the Belt and Road Initiative.”And in spite of the myriad attacks in the Western media regarding the Belt and Road’s alleged “debt trap”—and its description of China’s extensive involvement in Africa as a “new colonialism”—this “fake news” has not blurred the vision of Africa’s leaders, who have stayed focused on the future of the continent.
Ramaphosa also praised the work of China’s Belt and Road Initiative: “Why do we support the Belt and Road Initiative?” “Because we are confident that this initiative, which effectively complements the work of FOCAC, will reduce the costs and increase the volume of trade between Africa and China. It will encourage the development of Africa’s infrastructure, a critical requirement for meaningful regional and continental integration.” Read: FOCAC Summit: Turning Point in History
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“It can be said that this sentiment is near universal among the African nations now participating in the BRI. Indeed the president of the African Development Bank (AfDB), Dr. Akinwumi Adesina, told Xinhua on the sidelines of the summit, “Let me be very clear that Africa has absolutely no debt crisis; African countries are desperate for infrastructure. The population is rising, urbanization is there, and fiscal space is very small.” The AfDB president added, “They are taking on a lot more debt, but in the right way.” Read: Changes Underway as FOCAC Convenes
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Final Call: IMF and World Bank real culprits in Africa’s debt Crisis
This article debunks the myth of China colonizing Africa through a “debt trap” policy. It also has quotes from me on this subject. You can read more comments from me with this link to my post: A Brief Response: Marshall Plan for Africa or “Debt Trap?”
FINAL CALL: IMF-and-World-Bank-real-culprits-in-Africa-debt-crisis.
BY JEHRON MUHAMMAD | SEP 12, 2018
The phrase they use to accuse China is “debt book diplomacy,” a play on the past usage of the term “gunboat diplomacy” about U.S. policy. They accuse China of miring Africa in debt and “undercutting their sovereignty.”
Chinese President Xi Jinping (R) meets with African Union Chair Paul Kagame who is President of Rwanda at the Great Hall of the People in Beijing, capital of China, Sept. 4, 2018. (Xinhua/Ju Peng) |
Not to be outdone, ABC News chimed in: “China’s commercial presence in Africa has prompted complaints in some countries that the continent gets too little from the relationship. Africa is a major target of Beijing’s ‘Belt and Road’ initiative to build ports, highways and other trade-related infrastructure, but some critics in Tanzania, Kenya and other countries say they leave hosts with too much debt.”Pushing back, China claims to be helping African development, not piling up debt, one top China government official said.
“If we take a closer look at these African countries that are heavily in debt, China is not their main creditor,” its special envoy for Africa Xu Jinghy said, during a news conference. “It’s senseless and baseless to shift the blame onto China for debt problems.”
Claims that China is an “economic predator” in Africa, pillaging natural resources and dragging it into debt crisis are “as false as they are sensational,” the Xinhua official Chinese news agency said in a commentary.
According to African economic and political analyst Lawrence Freeman, “It is more than ironic that the West is complaining about Africa’s debt to China. Since the 1960s, Western nations, the IMF, World Bank, Paris Club, etc., have ‘looted’ Africa of hundreds of billions of dollars in bloated debt payments and through the manipulation of currencies, and terms of trade.”
Of note is the fact that the anti- China accusation is fairly recent. An April 18 Financial Times article, headlined “African nations slipping into new debt crises,” did not mention China one time as the source of the continent’s debt crisis.
In fact the FT’s piece is critical of the International Monetary Fund and World Bank. “The increase in debt should have raised all sorts of flags and triggered triage, but it didn’t. Neither the International Monetary Fund nor the World Bank sounded the alarm,” the London-based financial paper reported.
In addition, the FT claimed some African countries were hit because “they borrowed in foreign currencies and were finding debt hard to finance after a significant depreciation.”
In 2017 Quartz Africa reported, again not mentioning China, that “African eurobond debt is growing to risky levels.” A eurobond, also referred to as sovereign bond, is a debt security issued by a national government and is denominated in a foreign currency, usually dollars, rather than the euro that its name implies.
This debt crises have been cyclical. Africa’s debt of the 1980s mushroomed to $270 billion and had many factors, according to Quartz, “depending on which side of the fence you’re on.”
Those events came full circle. Even though Quartz recognized the repeating “hallmarks” of unchecked corruption, poor governance, and political mileage investment, the “single catalytic factor to trigger debt unsustainability in Africa has always been the crash of commodity prices on the global market.”
The news service Reuters reported in May of 2017 that “most sub-Saharan African countries still rely on U.S. dollar-denominated debt to finance their economies. Some investors say this is sowing the seeds of future debt crises if local currencies devalue and make dollar debt repayments more expensive.”
The United Nations trade body UNCTAD estimates that Africa’s external debt rapidly grew to $443 billion by 2013 through bilateral borrowing, syndicated loans and bonds. But since then sharp currency devaluations across the continent have pushed up the cost of servicing this debt pile, which continues to grow, the agency said.
It’s no wonder over 50 African heads of state attended the Sept. 3-4 Forum on China-African Cooperation (FOCAC) in Beijing. During the forum China president Xi Jinping announced a hefty $60 billion package to compliment another $60 billion pledged at the 2015 summit.
This breaks down, according to press reports, to $15 billion in grants and interest free loans, $20 billion in credit lines, a $10 billion fund for development financing, $5 billion to finance imports from Africa and waving the debt of the poorest African nations diplomatically linked to China.
On top of President Jinping letting the numbers speak for themselves he had words for China’s detractors: “Only the people of China and Africa have the right to comment on whether China-Africa cooperation is doing well … . No one should deny the significant achievement of China-Africa cooperation based on their assumptions and speculations.”
The African Union chairman, Rwandan President Paul Kagame, has been heard to call Chinese aid and investment strategy in Africa “deeply transformational” and respectful of the continent’s global position.
He said FOCAC had grown into a powerful engine “of cooperation fully aligned with Africa’s Agenda 2063 and sustainable development goals.”
“Our growing ties with China do not come at anyone’s expense. The gains are enjoyed by all who do business with us. Building the capacity of African institutions to transact and monitor more effectively is what will make the biggest difference,” he said.
Follow @jehronmuhammad on Twitter
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Africa Will Be the Breadbasket of the World With Investment in Physical Infrastructure
Africa Should be the Breadbasket of the World, Says the African Development Bank President
Aug. 9, 2018–Addressing the 2018 Agricultural and Applied Economics Association Annual Meeting in Washington attended by over 1,600 agricultural and applied economists from around the world, African Development Bank (AfDB) President Akinwumi Adesina said Aug. 5 that Africa should be the breadbasket of the world, and questioned why Africa should be spending $35 billion a year importing food.
“All it needs to do is harness the available technologies with the right policies, and rapidly raise agricultural productivity and incomes for farmers, and assure lower food prices for consumers,” Adesina said, according to the AfDB website. “Technologies to achieve Africa’s green revolution exist, but are mostly just sitting on the shelves. The challenge is a lack of supportive policies to ensure that they are scaled up to reach millions of farmers,” he stated, not referring to phony “green” environmentalism, but the green revolution that raises productivity and would make Africa food secure.
Adesina, who was the 2017 World Food Prize winner, is advocating the creation of staple crops processing zones across Africa (SCPZs): vast areas within rural areas, set aside and managed for agribusiness and food manufacturing industries and other agro-allied industries, enabled with the right policies and infrastructure. “I am convinced that just like industrial parks helped China, so will the SCPZs help to create new economic zones in rural areas that will help lift hundreds of millions out of poverty through the transformation of agriculture–the main source of their livelihoods–from a way of life into a viable, profitable business that will unleash new sources of wealth,” he said.
Uganda’s President Yoweri Museveni, in Tanzania, Calls for Investment in Infrastructure Development
Aug. 9, 2018–Uganda’s President Yoweri Museveni, who arrived in Tanzania today on a one-day trip to discuss regional matters with President John Magufuli, said he requested the meeting to brief Magufuli on the outcome of the July 25-27 BRICS Summit in South Africa, during which Museveni made a case for the BRICS countries to invest in the East Africa Community (EAC) which provides high returns on their investments, higher than Europe, Latin America and Asia. He said: “Investment in infrastructure development is key, especially in roads, railway and electricity. The Chinese have already helped us construct two hydropower dams, in Karuma, which is 600MW, and Isimba 183MW,” the {Kampala Post} reported today. Museveni attended the BRICS summit as rotating head of the EAC this year.
Uganda is a significant beneficiary of Chinese investments in East Africa. China has extended its hand of investment to many African countries, and continues to do so to uplift their economies. Liaoshen Industrial Park and Mbale Industrial Park in Uganda, launched last March, are set to increase local employment. The Chinese investors will offer training to the Ugandans who will work there. Among other spin-offs could be increase trade between Uganda and China.
Development Leapfrogs in Africa Due to Chinese BRI Investment
Aug. 8, 2018 — In an Aug. 7 op-ed to China Global Television Network, He Wenping, senior research fellow at the Charhar Institute, depicts the dramatic changes she’s seen in Africa after a visit to Djibouti earlier this month.
Prof He states the “two wings” of China-Africa industrial capacity cooperation; infrastructure construction and industrial park construction, have been booming on the African continent. This includes the Nairobi-Mombasa railroad and the Djibouti-Addis Ababa Railroad [see slugs in this briefing], as well as rail lines in Angola and Nigeria. In addition there are over 100 Sino-African industrial parks either in operation or under construction.
“Wherever you go, you can see an upsurge in infrastructure construction in Djibouti and a huge presence of China,” He writes. “For example, the largest free trade zone in Africa, jointly managed by Chinese enterprises and local entities, began construction in early July; the already completed Addis Ababa-Djibouti Railway; the port built by China Merchants Group; and the thousands of economic housing projects built with the of Djibouti President Ismail Omar Guelleh when he visited China in November last year. “The Westerners have been around for more
than 100 years but our country is still so poor, and the Chinese came to our country only three years ago but we have already seen great changes and hope,” President Guelleh said.
By the end of 2017, the stock of Chinese investment in Africa had exceeded $100 billion and more than 3,500 Chinese enterprises had invested and operated on the continent. He points to the example of Dongguan Huajian Group’s investment in a shoe factory in Ethiopia. The Huajian Group has created 7,500 local jobs in Ethiopia, and the Huajian (Ethiopia) Shoe Factory now produces 5 million pairs of women’s shoes annually.
“The hope for development comes from the new impetus provided by the BRI,” He Wenping writes. “Since the Chinese government proposed the BRI in 2013, the African continent, with its abundant resources, huge market potential and strong infrastructure construction demand, has been actively involved in BRI-related projects.
“And in the process of participation, the continent seized an important opportunity for historical development, in order to achieve leapfrog development and transformation from a pre-industrial to a fully industrialized society.”
Kenya’s Standard Gauge Railway Revolutionizing Transportation
Aug. 8, 2018– Kenya’s new, up-and-running Standard Gauge Railway (SGR) from the Port of Mombasa to the capital, Nairobi, built with major Chinese participation, is already revolutionizing the country’s transportation according to the {Daily Nation} of Kenya.
The railway runs seven trains a day carrying a total of 752 containers from the port to Nairobi. While roughly 1,300 containers arrive at the port daily, the time necessary for a ship to clear the port has been reduced from 12 days to just a day and half! This has created a quantum leap in the potential throughput the port, without having to physically expand it. By August, the connection of the SGR line to berths at the port will be complete, increasing the efficiency even further.
Of course this has led to loss of business and employment at the container freight stations (CFS) where the containers were broken down and transferred to trucks. In answer to this problem Transport Principal Secretary Paul Maringa said that SGR has brought more gains to the economy, ensured efficiency at the Mombasa port and saved roads from overloaded trucks. “We cannot continue having the conversation about Mombasa and Nairobi. We must look at the bigger picture. We are encouraging the CFS owners to come and open their stations in Nairobi and other parts of the country,” Maringa told the {Daily Nation} by phone. Asked whether players in the sector should concentrate on investing in Nairobi, Maringa said, “We should not lose the direction. Let’s look at things holistically. We have been able to attract more business at the port which is benefitting Mombasa and the country at large,” he said. “And this is because of the speed that the SGR has been able to transport cargo to the inland container depot in Nairobi compared to the trucks. We have added handling capacity at the port and that is beneficial to all of us,” he said, stating that the port has handle at least 17,000 containers.
Furthermore the SGR has enabled the government to save money for other development projects. “The accidents cases have also gone down. Those are the silent benefits of the project as Kenyans’ lives are more important than the businesses we are doing,” he said.
Ethiopia Railway on the Road to Self-Management
Aug. 8, 2018–China is now training Ethiopians to independently run the new standard gauge railway line between Djibouti and Addis Ababa. As of now the locomotive drivers, the management, and many of technicians are still Chinese. While teams of Ethiopians and Djiboutians have been undergoing training in China, the Chinese and Ethiopian governments are cooperating in building an Ethiopian railway academy.
The Chinese Embassy Economic and Commercial Counselor Liu Yu told the {Ethiopian Herald}, “The Ethiopia railway academy is already under design in Bishoftu. The government has donated $60 million for the construction. Ethiopia and China have been enjoying strong relationship and cooperating in different areas, one of which is human capacity building takes the epicenter.”
The Ethiopia-Djibouti Railway Share Company (EDRSC) Director General Tilahun Sarka stressed that human resource development is the top priority of the corporation, as the railway has been under the management of two Chinese companies, China Railway Group (CREC) and China Civil Engineering Construction Corporation (CCECC).
Pointing to the high quality of the Chinese training, Tilahun said: “The good thing about Chinese instructors and lecturers, as long as you keep on asking questions you will get what you need.”
“Keeping the ration of the EDRSC share, we are engaged in training about 50 Ethiopian and Djiboutian prospective train drivers. These trainees will exchange ideas on topics related to railway operations technologies and railway management, that could realize and create a competent and skilled labor force to operate the Chinese-built and financed 756 km Ethiopia-Djibouti electrified rail line,” he stated.
One trainee, Eyoba Dubale, told the {Ethiopian Herald}: “The trainers from China are dedicated in assisting us. The training is going well in its schedules and we are happy of the whole process. After the training we will be assistant driver, and after establishing comprehensive skills and knowledge as well as attitude of serving in the system, we will take over charge of the driving responsibility to the service the logistics sector for the common good.”
The EDRSC is part of the five-year growth and transformation plan, which aims to enhance the transportation network within the country by connecting to adjacent countries and ports. The National Railway Network of Ethiopia is believed to provide efficient mobility and improve the export and import activities, boosting the economic development.
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Who Owns Africa’s Debt: China or The West?
“China’s loans to Africa leave their sovereignty unscathed”
By Yang Sheng-Global Times July 12, 2018
Some Western media and politicians have recently created the phrase “debtbook diplomacy” to accuse China of “miring nations in debt” and “undercutting their sovereignty.”
According to CNN, a new report presented to the US State Department claims the “Chinese government is leveraging billions of dollars in debt to gain political leverage with developing countries.”
“This phrase ‘debtbook diplomacy’ shows the West is nervous of China-Africa cooperation. ‘Debtbook diplomacy’ is what they did to Africa for decades, but now China is actually helping African nations rid themselves of ‘the debt trap’ set by the West,” said Wang Yiwei, director of the Institute of International Affairs at Renmin University of China in Beijing.
The West left African countries with a heavy debt on projects and failed to support their sustainable development, or to increase productivity and help them realize self-reliance, Wang noted. “Western countries wanted Africa to become their raw materials supplier while maintaining their post-colonial influence over the continent. This prevented African countries from realizing their own industrialization, Wang said.
China, on the other hand, is helping the nations move toward self-reliance and industrialization. The West doesn’t like that and this is why it is attempting to slander China, Wang added.
Xu Weizhong, deputy director of the China Institutes of Contemporary International Relations’ Institute of West Asian and African Studies, said that “Africa needs a lot of investment to build infrastructure, and China’s loans, which have increased African countries’ debt, are necessary for their development.”
China’s assistance to Africa differs from what the West offers. China has a “crucial principle,” which is to respect African countries’ will and conditions. China has never forced African countries to accept loans on large infrastructure projects beyond their ability to pay, Wang said.
“China and Africa have walked an extraordinary path in developing relations and cooperation, and our peoples have benefited greatly from it,” Assistant Foreign Minister Chen Xiaodong said at the opening ceremony of the Seventh China-Africa Think Tank Forum in Beijing on July 4.
“A minority of Westerners are blinded by their ‘pride and prejudice’ and choose not to see this… maybe that is what they call ‘sour grapes’?” Chen said.
West is largest debt holder
Data shows that Western countries and West-led organizations are the largest owners of African debt, not China, Shen Shiwei, a research fellow at the Charhar Institute and former government relations and business consultant for Chinese enterprises in Africa, said in an article published on CGTN’s website.
Research from SAIS and the China Africa Research Initiative at Johns Hopkins University shows that China has provided loans worth $114.4 billion to Africa from 2000-2016, which accounts for 1.8 percent of Africa’s total external debt.
“The IMF and World Bank own 36 percent of African debt.These multilateral financial institutions and other giant investors in Europe and the US have far stronger leverage [than China],” Shen noted in his article.
“For historical reasons, the West has many interests in Africa. Those that are reasonable should be respected when we cooperate with Africa. But for those that are unreasonable, should China and African countries continue to respect them? Before accusing China, the West should think about this carefully,” Xu said (emphasis added)
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“It’s time for Europe to learn from China in engaging in Africa”
The just-concluded EU Summit on migration has come up with measures like securing centers for migrants to process asylum claims, strengthening external border controls, and boosting financing for Turkey and countries in North Africa. But these are old solutions to old problems.
Since 2015, the EU has been working at full capacity to overcome the migration crisis. EU member states received over 1.2 million first-time asylum applications in 2015, more than double that of the previous year. But it seems that the European continent is still working in the same old way to try to prevent the entry of immigrants and not to address the causes of migration. Even if we assume these measures bring success in reducing immigration for some time, the EU will later be surprised when migrants use other means and methods to migrate, because the causes of migration still exist.
The root of migration is poverty. The African continent has suffered occupation and war for many decades. Many African countries have not yet been able to achieve the path of reform and development. This has put the people of these countries under unbearable pressure from poverty, ignorance and disease. They have pushed themselves into the abyss and tried to cross the border to reach Europe. They have faced danger and horror, believing a chance at a better future is worth dying for, if necessary.
With the emergence of the new system of globalization, the world became a small village and Africans opened their eyes to the luxury and good life enjoyed by Europeans, which inspired them to move to these countries. The majority of people from African countries continue to blame European countries for their backwardness and believe they should shoulder their responsibilities toward Africa. As a result of the failure of European countries to play the role that the African people were waiting for, these masses migrated to Europe to try to gain these rights. Europe, when dealing with refugees, looks at them from a perspective of human logic or empathy and does not view migration as a symptom of a disease. European countries must change their thinking and strategy to deal with the disease in order to make the causes of migration disappear.
It is time for Europe to look at the Chinese experience in Africa. The Chinese policy has always focused on development. Economic relations between Africa and China have grown enormously, especially since 2006. The African continent is playing an important role in the Belt and Road initiative. China provides infrastructure funding and a workforce, and this infrastructure allows Africa to increase its production and exports, improving the quality of life and improving the conditions of millions of Africans.
Hope is the solution. The people of the African continent need hope. At least this last summit has come out with some words about more investment in Africa to help the continent achieve a substantial socio-economic transformation. China has been focusing on African development for a long time and has seen the results. The EU should work closely with China to push for the B&R to fight poverty in Africa and promote development. (emphasis added)
He Wenping is a senior research fellow at the Charhar Institute in China, and Hisham Abu Bakr Metwally is the first economist researcher at the Central Department for Export & Import Policy under the Egyptian Ministry of Foreign Trade and Industry. bizopinion@globaltimes.com.cn
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By William Jones
The world is on tenterhooks waiting for the next moves from the Trump Administration in terms of the draconian tariffs he has threatened to place on China as well as on a number of other countries, including our close neighbors Canada and Mexico. And the question remains for most people: Is he really intent on carrying out the threat (the first tariffs are to take effect on July 6) or is this merely an “in-your-face” negotiating tactic to cut a better deal for the United States? We probably won’t know until the last moment, but a number of things seem to be clear.
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President of Ghana Speaks out for Strong Independent Africa
Speaking at the Presidential Palace of Ghana on December 4, 2017 with French President Macron, Ghanaian President Akufo-Addo spoke eloquently of the need for Africa to be self-sustaining and independent. Emphasizing that when African nations became developed their people would have no need to migrate to Europe. To watch his speech click: Speech by the President of Ghana
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Through Science, Africa’s Challenges Will Be Met
December 10, 2017)–South Africa’s Science and Technology Minister Naledi Pandor told the third Science Forum in Pretoria on Dec. 7, that “it is through science that many of the challenges faced by our communities can be addressed.” A primary objective of the two-day forum, she said, is “to put science in the service of African society.” She stressed the importance of international collaboration, welcoming delegates from around the world to Africa’s largest “open science” event. Pan-African cooperation, in particular, is a hallmark of all of South Africa’s science and technology programs.
The purpose of the forum was to discuss the role of science in society. She said that one objective of the forum was to “showcase African science and technology to the world. We want to change the way they talk about us.” Pandor is dedicated to promoting African breakthroughs in science, which will change the way Africa has historically been viewed, and will help eliminate the “Afro-pessimism” on the continent itself.
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The New York Times Is All Wrong About Africa
Lawrence Freeman
August 3, 2017
The July 30th Sunday edition of the New York Times, published an article by its Africa reporter, Jeffrey Gettleman, entitled, “Loss of Fertile Land Fuels ‘Looming Crisis’ Across Africa.” The analysis, and conclusions of this article are all wrong, because they are based on false and ideologically driven axioms regarding the development of Africa. Essentially, Gettlemen and the New York Times are steeped in the “Zero Growth” culture which became prevalent in the United States and the West in 1970s.
In the aftermath of the 1963 assassinations of President John F Kennedy and the ensuing “rock-drug-sex” counterculture, the groundwork was prepared for the onslaught the environmental movement. With its no-growth, anti-science, anti-industrialization outlook that dominated the thinking of the baby-boomer and succeeding generations, cultural pessimism became pervasive. This ideology combined with the looting of Africa’s natural resources by the financial predators of Wall Street and the City of London resulted in a policy of no development for Africa that has continued to the present.
Today Africa has the largest deficit of infrastructure per capita and per square kilometer on the planet. The lack of electrical power, railroads, water management, and modern highways is literally responsible for the deaths of millions of Africans each year. Only since the entrance of China into Africa in the past decade with its commitment to build physical infrastructure, have we witnessed a change in the dynamic on the continent.
Economic Science
It is no accident that the US and Europe have not contributed to the construction of vital infrastructure projects; it’s their flawed policy. Infrastructure is not just one of several possible good ideas; rather it is an indispensable, irreplaceable ingredient to the success of any agro-industrial economy. Infrastructure drives an economy forward and upward by incorporating new scientific advances in technology that improve the productive powers of the workforce, yielding increased economic output of wealth for society. The most wicked and pernicious feature of the Zero-Growth ideology is the denial of the unique creativity of Mankind. For thousands and millions of years Mankind has transformed his surrounding environment to make it more propitious for human expansion. Like the discovery of “fire,” a million years ago, the Neolithic revolution 12,000 years ago was a revolution in Mankind’s knowledge of the universe and led to a population explosion. This non-linear growth pattern has been repeated many times over the last 10,000 years, as a result of the unique power of discovery by the human mind.
The essential underlying cause of the problems in Africa today is not over population, or loss of arable land, but underdevelopment. The failure to grasp this elementary concept by the New York Times and others is the reason for the abysmal conditions of life in Africa’s that contributes to the easy recruitment to terrorist movements like Boko Haram in the Lake Chad Basin region.
False Axioms
For example, Gettleman cites the:
“overwhelming degradation of agricultural land throughout Africa, with one recent study showing that more than 40 million Africans are trying to survive off land whose agricultural potential is declining.” He continues, “More than in any other region of the world, people in Africa live off the land. There are relatively few industrial or service jobs here. Seventy percent of Africa’s population makes a living through agriculture, higher than on any other continent, the World Bank says. But as the population rises, with more siblings competing for their share of the family farm, the slices are getting thinner.”
Why is agricultural potential of the land declining? Why are there relatively few manufacturing jobs? Why are the slices of land getting thinner?
The answer is not the Malthusian argument that Africans breed too fast and that this huge continent – almost three times the size of the continental US- has too many people trying to exist on a shrinking pie of arable land. The proper question to ask is; why after half century since the “Winds of Change” liberation from the colonial powers, Africans still do not enjoy the fruits of modern industrialized economies with a modern standard of living, instead of large pockets of abject poverty? Any poor-quality farm land, even the Sahara Desert, can be made productive with water. Less than 5% of cultivated land is irrigated In Africa. With manufacturing plants to build the irrigating machinery and sufficient energy to pump the water, millions of hectares of arable land can become fruitful. Nuclear powered desalination could provide fresh water from the Mediterranean and Red seas to the North African deserts. US farmers, among the most productive in the world, experienced huge increase in yields of food production including in the former desert of southern California by utilizing new technologies, fertilizers, irrigation, and abundant energy under President Franklin Roosevelt’s economic recovery.
Why has the US and the West not assisted African nations in acquiring the necessary infrastructure and new technologies to expand its cultivated land and build a substantial manufacturing sector as part of an integrated modern economy. In his brief Presidency, John F Kennedy collaborated with President Kwame Nkrumah of Ghana to build the Volta Dam hydro-power and industrial smelting complex. This what we should have continued to do over the last 50 years, and if we had, Africa would look completely different than it does today.
Population Reduction Is Not the Solution
In the concluding section the article, the New York Times and its reporter reveal the depraved thinking of the Zeitgest of western culture; we have too many people using up the fixed natural resources of our planet.
“Africa’s land pressures may seem overwhelming, maybe even unstoppable. But scientists say there are solutions within reach. For example, the continent has the highest fertility rates in the world, but more African governments are pushing contraceptives, saying the best answer for densely populated countries is smaller families.
‘The problem is too many people, too many cattle and too little planning,’ said Iain Douglas Hamilton, a wildlife activist in northern Kenya.”
This view echoes Henry Kissinger’s infamous “National Security Study Memorandum 200,” written 1974-1976, which advocated reducing the population for “Third World” nations to guarantee an uninterrupted supply of vital natural resources to the West. For centuries, the British raciest imperialist school has targeted Africa’s population as inferior and as an impediment to their access of Africa’s precious minerals.
The birth a child can never be a problem for society. Each new human being, by the fact that it is human, intrinsically has the potential to contribute to new discoveries that can change the world, or contribute to the progress of society in more humble manner. Why not take up the challenge of developing the vast continent of Africa with its soon to be multi-billion population, and its rich untapped wealth? Presently we are witnessing the construction of desperately needed infrastructure on the Africa continent, with the assistance of China. Yet, Africa’s requires hundreds of gigawatts of electrical power, East-West and South-North railroads, high speed trains connecting the capital of each nation, and much, much, more. If the US joins the new paradigm of China’s “Belt and Road Initiative” and collaborates on eliminating poverty and hunger, and expanding Afrfia’s unrealized agricultural potential, the continent will be able to sustain an expanding population at a standard of living commensurate with that of the advanced sector nations.
Let us act on the words of President Franklin Roosevelt, when he told his son at the Casablanca Conference during World War II, that if we divert water into the Sahara Desert: “It’d make the Imperial Valley in California look like a cabbage patch.”
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The New Name for Peace is Development
Lawrence Freeman
June 30, 2017
Africa’s huge, unacceptable deficit in physical infrastructure is the primary cause for the continent’s problems; not over population, good governance or corruption. It is this underdevelopment in physical economy that is literally killing millions of Africans, through disease, dirty water (cholera,) starvation, and tribal-ethnic-religious warfare.
With the population of Africa projected to reach 2.4 billion in 2050-in less than two generations from now, of which approximately 30%-over 700 million will be 35 years of younger; the continent is facing an existential crisis. With hundreds of millions of youth ready to enter new workforce, unless African nations adopt future oriented polices now to grow healthy economies and provide them with meaningful-productive jobs, they face a potential catastrophe. To accomplish this task, governments must initiate planning and investment today for hard infrastructure in the vital categories; of energy, road, rail, and water, and soft infrastructure in health and education to create a platform for robust economic growth. Statesmen should guide their nations with a vision in their mind’s eye of how their economy should be function one to two generations into the future.
In Africa most especially, there is no substitute for infrastructure and grand-transformative projects, such as Transaqua, and East-West/North-South railroads, to ensure the survival and well-being of its soon to be billions of citizens. As a result of the Chinese One Belt-One Road policy, championed by President Xi Jinping, Africa has an opportunity to construct the infrastructure that should have been built a half century ago following the “Winds of Change,” if not earlier. With China’s assistance new railroads have been built in Ethiopia and Kenya for the first time in a century, but Africa needs much, much more. Today’s mere 100,000 megawatts for sub-Sahara Africa is a virtual death sentence. Africa needs hundreds of thousands of additional megawatts of power along millions of kilometers of railroad track for passenger and freight, and this is just the beginning of what can and should be done to lift all Africans up to a 21st century standard of living.
Like the African proverb says: The best time to plant a tree was twenty years ago. The next best time is today. Let’s get on with it!
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UN Adviser Prof Ibrahim Gambari, Tells The Truth About Africa
Lawrence Freeman
March 1, 2002
The most urgent challenge facing Africa is “poverty prevention and development,” according to Gambari, who provides the following facts and figures. “Over 42% of Africa’s population lives on less than $1 a day, and 40% in inhuman poverty. Out of 700 million Africans, 120 million women are illiterate, and 150,000 die every year as a result of complications related to pregnancy. Even worse is the death [in the last decade] of 22 million children who die before they reach their first birthday.” This misery is concentrated in Africa’s Sub-Saharan region.
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Ghana Amb Dr. Kofi Awoonor: ‘The United Nations has lost its moral authority’
Dr. Kofi Awoonor is the ambassador and permanent representative of Ghana to the United Nations. In 1991 he was chairman of the Group of 77, which represents the more than 100 developing sector nations.
Interview-July 2, 1993
” You don’t know what we are going through, in the developing countries, after suffering so many years of colonial exploitation. We did say that in the Non- Aligned Africa’s position has been buttressed very strongly, since we are weakest link in the economic chain, by countries that are developing strong economies ; countries in Asia in particular, by Malaysia, by Indonesia, al1d so on. These countries have seen a concerted attack, a conspiracy to undermine their own development efforts by a singularly austere focus on the liberal aspect of human rights.
Of course, the NGOs-we are a little worried sometimes about the NGOs. I had a lot of problems with the NGOs when I was chairing the G-77 , on the environmental issue. I remember addressing the entire NGO group at one of the preparatory meetings in Geneva. And I said to them: “For God’s sake, you cannot make environmental work part and parcel of some kind of almost dilettantish attachment to whales and elephants, and such wonderful species that we have here. Human beings are imperiled. “Some of them seemed to understand it. But you see many of them are coming from this intellectual, emotional, psychological tradition of the West, which has perfected the habit of separate things.”
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Ghana Amb Dr. Kofi Awonoor: ‘By a stroke of the pen, cancel all debts’
Interview-October 22, 1991
Dr. Kofi Nyidevu Awoonor is the Ambassador and Permanent Representative of Ghana to the United Nations. He is also chairman of the Group of 77, which represents the more than 100 developing sector nations.
When the question of the environment was put on the international agenda a few years ago, we were enthusiastic supporters of this issue, because we share a common planet and we must be concerned as to its fate. But suddenly, when we, the developing countries, insisted upon the question of development being an intrinsic aspect of any effort to deal with environmental degradation on a global scale, we were being told that we were introducing an irrelevant issue. And we said: It’s not only a question of keeping the world green, or protecting the flora or the fauna of this planet, but the human beings which are the makers or unmakers of this planet. A great percentage of that human population lives in a state of abject poverty. In our parts of the world, poverty is the cause of environmental degradation, if it is not in the developed parts of the world, where over consumption is ..