Image Credits : Business Live
South African President Cyril Ramaphosa has rejected claims that China is pushing Africa into a “debt trap” through its investments on the continent. Speaking at the 2024 China-Africa Summit in Beijing, Ramaphosa emphasized that Chinese financing and infrastructure support benefit Africa’s development and dismissed criticism that these loans are intended to saddle African nations with unsustainable debt.
Ramaphosa’s defence comes in response to Western criticism that China’s loans, particularly for large infrastructure projects, burden African nations with debt they struggle to repay. These concerns have been highlighted by both U.S. and European policymakers, who argue that China’s approach to lending, especially under the Belt and Road Initiative (BRI), could undermine the financial sovereignty of African countries. However, African leaders, including Ramaphosa, have consistently stressed that China’s involvement has been largely positive, facilitating critical infrastructure development that would otherwise be challenging to finance.
At the summit, Ramaphosa highlighted areas of cooperation between South Africa and China, particularly in energy reform. South Africa has been plagued by power shortages and rolling blackouts for years, severely affecting its economy. Ramaphosa expressed optimism about learning from China’s approach to energy development, which has seen rapid reform and expansion of renewable energy sources. The collaboration could help South Africa stabilize its energy sector.
South Africa in addition to energy, is also seeking investment from China’s electric vehicle (EV) industry. Ramaphosa revealed that South Africa has engaged in discussions with BYD, China’s largest EV manufacturer, to explore opportunities for the company to invest in the country. Such investments would align with South Africa’s goals of creating jobs, improving infrastructure, and developing a green economy as it shifts towards more sustainable practices.