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China, the U.S., and Kenya

This week on the Sinica Podcast, Kaiser and Jeremy are joined by Eric Olander, host of the China in Africa Podcast from the China Africa Project, and by Anzetse Were, a developmental economist based in Nairobi. They explore questions related to Kenyan debt and development, as well as Sino-American competition in East Africa.

What to listen for on this week’s Sinica Podcast:

10:33: When did China begin to put concerted diplomatic effort into relations with African countries? What were the optics of China’s push into the African continent? Anzetse highlights three examples that led to China’s success in dealing with businesses and governments: “[Chinese diplomats] are quite humble in their articulation, certainly to African people, saying, ‘While this has been the Chinese experience, we don’t know what you want, what you can learn and what you don’t want to learn.’ So they’re not prescriptive. But of course the biggest thing that African governments like is that they don’t lecture about anything.”

19:05: Is China leading African countries into “debt traps”? What are the primary causes for concern regarding the debts of African governments, and the wider international community? Anzetse explains that it’s a confluence of factors, including transparency issues and the effects of kindling trade relationships with new partners: “There is concern in the global north, particularly Europe and North America, as to reexposure in African governments to debt…and their concern is that they’re doing it with a party that the world does not really understand in terms of how it deals with debt defaults and how it deals with repayments owed. I think that Europe and North America were much more comfortable when debt owed was in their hands, obviously because they had [control], but I think because they had a common understanding on how this would be addressed. They do not know how the Chinese are going to do this.”

39:00: In response to Jeremy’s question about Africa’s response to U.S. National Security Adviser John Bolton’s announcement of a “new Africa Strategy” called “Prosper Africa,” Anzetse wryly replies, “I mean, you’ll be surprised, but it didn’t really make a blip, honestly.”

“This is the thing that Americans struggle to understand,” Eric pipes up, “is that irrelevance is coming.”

42:21: America is restructuring the way it provides aid to the rest of the world through the International Development Finance Corporation (IDFC) and the Better Utilization of Investments Leading to Development Act (BUILD Act), in an attempt to compete with China in the developing world. How effective is this restructuring? Eric provides some insight: “It’s not challenging China at all. It’s not intended to challenge China. Instead, they actually complement each other very, very well. So, a country like Kenya can turn to China for infrastructure and massive loans from the Chinese for a public sector type of development. But then, IDFC and the U.S. come in to fund American businesses and Kenyan businesses that can’t get funding anywhere else.”

He continues a bit later: “Let’s go back to the Bolton speech really quickly and let’s kind of set the table for what led up to the Bolton speech and why the reaction in Africa was what it was. Because let’s remember, for the past two years, the Trump administration banned African countries from actually immigrating into the United States, they were on the travel ban, they put steel tariffs on South African steel, they stripped Rwanda of its free trade access into the United States because the used clothing lobby in the United States still wanted to sell used clothing into Rwanda…they’ve cut back military spending, they’ve cut back aid, they’ve cut back UN spending. All of the key priorities, the United States has pulled back…

“Trump said they live in huts, and then on top of that we have Melania Trump’s colonial stroll through Kenya in her hat, and it just shows a collective lack of respect and a lack of face. And so I think people came very cynical to, right from the get-go, that you’ve got to show us something really good, and when they saw this Bolton policy was America first, China second, Africa third, it just kind of fell on deaf ears, because at the end of the day, people were saying well what have you done? Power Africa was an Obama program, a seven-billion-dollar electric-generation program. What has it done? Nothing. They haven’t even fulfilled the entire seven-billion-dollar commitment for it. People were on Twitter saying, the last time the Americans made a promise to do something, what came of it? The Chinese, they come in, they’re going to build a road, that road gets built in three months.”

49:36: What effect is the Belt and Road Initiative having in Africa? What about the African countries that are excluded from the plans, as China has made inroads, for the most part, on Africa’s eastern seaboard? Anzetse states: “I think the Chinese began to understand, ‘We do not want to start dividing African sentiments on China, we’re going to find a way to make sure all the regions in Africa are represented in this Belt and Road Initiative. Whether it will be practical is not clear.”

Recommendations:

Jeremy: I Didn’t Do It for You: How the World Betrayed a Small African Nation and In the Footsteps of Mr. Kurtz: Living on the Brink of Disaster in Mobutu’s Congo, both by Michela Wrong.

Eric: Competing against Chinese loans, U.S. companies face long odds in Africa, an article in the New York Times by Ed Wong.

Anzetse: Rhinocéros, by Eugène Ionesco.

Kaiser: Lake Success: A Novel, by Gary Shteyngart.

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Kaiser Kuo

Kaiser Kuo is co-founder of the Sinica Podcast and editor-at-large of SupChina.