Chinese Companies Win Contract to Build $2 Billion Railway between Burundi and Tanzania

 The Global Business Council published on 30 January 2025 an article titled "Tanzania and Burundi Award $2B Contract to Chinese Firms to Design and Build Regional Rail."

China Engineering Construction Group and China Railway Design and Consulting Group won the $2.15 billion contract to design and build the 282-kilometer-long railway between Uvinza in Tanzania and a nickel mine between Musongati and Gitenga in Burundi.  The railway will connect to an existing line in Tanzania that continues to the port of Dar es Salaam.  The African Development Bank is financing the project. Nickel is a critical mineral in the manufacture of electric vehicles.  

Kenya's Debt Crisis and China

India's Firstpost posted on 26 June 2024 a 6-minute video titled "Is Chinese Debt the Reason Kenya Wants to Raise Taxes?" 

The video spells out the background of Kenya's $76 billion public debt, noting that much of it is owned to the World Bank, IMF, African Development Bank, and reimbursement of Eurobonds.  But China is the single largest bilateral holder of Kenyan debt and Nairobi faces an upcoming repayment to Beijing of $1.2 billion that it is hard pressed to manage.

Chinese Company Suspends Work on Kenyan Road for Lack of Payment

 Kenya's Business Daily published on 27 November  2023 an article titled "Chinese Firm Suspends Work on Kenol Road over Sh900m Delay" by Bonface Otieno.  

China's Jiangxi Transportation Engineering Group has suspended construction on a section of a road in Kenya following a delay in payment by the government of Kenya and the African Development Bank.  The road is part of a Pan-African artery connecting Cairo to Cape Town.  

A New State of Chinese Loans to Africa

Boston University Global Development Policy Center posted on 18 August 2023 an update to its data base titled "A New State of Lending: Chinese Loans to Africa."   

From 2000-2022, 39 Chinese landers provided 1,243 loans amounting to $170 billion to 49 African governments and 7 regional institutions.  However, China's lending peaked in 2016 ($28 billion) and has fallen dramatically sense, totaling only about $1 billion in 2022.  

Kenya Slashes Funding for Infrastructure Based on Foreign Loans

 Business Daily published on 10 February 2023 an article titled "19 Mega Projects Hit as Sh66.8bn China, Foreign Loans Cut" by Dominic Omondi. 

Kenya has slashed funding for 19 infrastructure projects dependent on loans from international financial institutions and bilateral lenders such as China.  

Asia Will Juice Africa's GDP Growth in 2023

 African Business published on 19 January 2023 an article titled "AFDB: Africa Will Grow 4% in 2023 as China Recovers" by Leo Komminoth.

Africa's GDP grew 3.8 percent in 2022 and is expected to increase to over 4 percent in 2023 with a risk of a continent-wide recession close to zero.  The African Development Bank believes the continent can reach this number partly because Asia and especially China are recovering after 3 years of COVID-19 polices.  Asia accounts for 40 percent of Africa's merchandise exports.

Putin's War Causing Food Crisis in Africa

Vanguard published on 2 April 2022 an article titled "Russia, Ukraine War: My Fears for Nigeria, Other African Countries--Ngozi Okonjo-Iweala" by Luminous Jannamike. 

The Director General of the World Trade Organization said she fears there will be a food crisis in some African countries since Russia's attack on Ukraine.  In many African countries, food prices have already risen by 20 percent and fertilizer prices globally have increased by 300 percent.  

Putin's War May Trigger African Food Crisis

 Aljazeera published on 29 March 2022 an article titled "AFDB President: Ukraine War Could Trigger a Food Crisis in Africa" by Jack Dutton.  

Africa is heavily dependent on wheat from Russia and Ukraine.  Wheat prices have increased by 64 percent since the beginning of the conflict and fertilizer prices are also rising sharply.  The head of the African Development Bank concluded the war could "trigger a food crisis in Africa."

Is China Building Africa?

The European Financial Review published on 22 June 2016 an article titled "Is China Building Africa?" by Zhengli Huang, an architect and urbanist, and Xiangming Chen, dean and director of the Center for Urban and Global Studies at Trinity College in Connecticut.

The authors argue that Chinese state-owned enterprises are generally misconceived as political allies with the central government, while their corporative nature with a profit orientation and financial constraints are largely overlooked. China is building the majority of infrastructure projects in Africa, but the financing of these projects often comes from sources other than Chinese banks and companies.

External Financial Flows and Tax Revenues for Africa

The African Development Bank has just released its African Economic Outlook for 2015.  Chapter 2 titled "External Financial Flows and Tax Revenues for Africa" reports that private external flows in the form of investment and remittances now drive growth in external finance.  Foreign investments are expected to reach $73.5 billion in 2015.  Foreign direct investment is moving away from mineral resources and into consumer goods and services.  African sovereign borrowing is rocketing.  Remittances have increased six-fold since 2000 and are projected to reach $64.6 billion in 2015.  Official development assistance will decline in 2015 to $54.9 billion. 

Somalia's Economic Recovery

Mohamud M. Uluso published a piece in the 2 May 2013 Pambazuka News titled "Somalia's Priority: National Integration for Economic Recovery."  It looks at the macroeconomic issues that need to be addressed urgently in Somalia.