Risky Business: Is China Wavering in Africa?

South Africa’s president arrives in Beijing for a Ministerial Conference of the Forum on China-Africa Cooperation (FOCAC). Photograph by GovernmentZA.

Chinese companies and banks were once seen as bold and fearless as they invested in countries Western investors deemed too risky. But this may now be changing.

By Jacob Kushner

In 2007, when two Chinese state-owned companies struck a deal with the Congolese government to build the biggest mine the country had ever seen, all involved were riding high. In a mega-deal originally worth some $9 billion, Sinohydro and the China Railway Engineering Corporation (CREC) would gain access to 6.8 million metric tons of copper, the future profits of which were to underwrite the prior building of hospitals, roads and other infrastructure.
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At the time, the China’s involvement in Africa was booming and the Sicomines deal embodied much that was symptomatic of Sino-African relations: it was massive-scale, involved vast infrastructural construction linked with similarly vast mineral resources, and was taking place in a country many other investors would have deemed too unstable.

It was not long, however, before confidence in the deal began to wane, especially amongst the deal’s financiers, China’s Export-Import Bank (Exim).

Read the full article at Think Africa Press.