Key facts and figures
China is now the largest trading partner for the African continent, and China’s Export-Import Bank aims to invest more than $1 trillion in the continent by 2025. In addition, China has now surpassed the United States government in total agriculture R&D funding. China has increased its presence in African development—a trend that will persist because its model is extremely attractive to both China and many African nations.
China’s growing contributions to African development should not automatically be feared, but their increased presence should create a recalibration in US approaches to development. Current US National Security Advisor and former Ambassador John Bolton in his announcement of the administration’s Prosper Africa initiative cast China’s presence in Africa as a strategic challenge for the United States.
The market opportunities on the African continent are enormous. Consumer expenditure is expected to reach $2.1 trillion by 2025 and $2.5 trillion by 2030. The World Bank estimates that the African food market alone could be worth $1 trillion by 2030, more than tripling the current $300 million market.
China’s ability to directly finance and construct infrastructure projects with fewer conditions is unique and has raised worries in some quarters about the expropriation of natural resources, environmental hazards, labor displacement, unstable debt burdens, and land grabs.
In addition, China’s investment strategy leaves notable gaps that the United States, leaning on its expertise, can fill. The most direct and sustainable mechanism for moving people out of poverty is investment in agriculture—in particular, smallholder agriculture. US leadership on global water, food, and nutrition security is essential to catalyze the innovations and development necessary to achieve US foreign policy and development goals on the continent.
To maintain its global leadership in this strategically important continent, the United States should consider prioritizing technical assistance for water sustainability and thereby support sanitation and agricultural growth. The United States must also continue to find ways to deepen its relationships with African partners to demonstrate US commitment to building resilience and self-reliance in these communities for the long term.
Simultaneously, the United States and its allies should work through international institutions to encourage China to adopt policies that achieve shared global objectives in economic development, security, human welfare, and sustainability.
The United States has been one of the African continent’s most important partners for decades, but new dynamics are changing the status quo. Specifically, China’s foreign investment has increased significantly in the past two decades, rising to prominence and beginning to fundamentally reshape the physical and political landscape of the continent.
Measuring this increased investment from China is difficult because the bureaucratic structure of this investment is often opaque, and China’s central government does not widely share data. But multiple recent external studies show a pattern of uneven but growing economic ties between Africa and China. These ties include major efforts to expand trade relationships and increasing direct investments in infrastructure, such as hydroelectric dams and other development programs. While China’s Export-Import Bank has yet to exceed the World Bank in annual investment in Africa, it is expected to in the near future if trends continue.
China’s increased presence in Africa arose and will persist because it is extremely attractive to both China and many African nations. For some nations, a partnership with China is irresistible because of the significant and urgent need for infrastructure, which China is willing to finance. Many nations also believe China-supplied money for projects is more readily accessible and less conditional than Western loans. For China, projected critical natural-resource shortages and the need to expand the global demand for Chinese goods make Africa a valuable target for investment.
The United States should recognize this new reality and recalibrate its strategy in Africa for two reasons. First, although China-backed financing may be easier to secure than loans from other countries, the loan and grant conditions used by Western countries, such as the United States, have been honed through more than 50 years of experience to encourage long-term sustainable development. By comparison, some US officials have criticized China’s current development model as predatory and unsustainable, leaving African nations’ strategic resources and infrastructure exposed to exploitation and expropriation.
Second, as noted by the former US Ambassador to the United Nations and current US National Security Advisor John Bolton in his announcement of the current administration’s Prosper Africa initiative, China’s presence in Africa poses a strategic challenge for the United States. As African nations develop, they become potentially substantial economic partners for the United States. African consumer expenditure is expected to reach $2.1 trillion by 2025 and $2.5 trillion by 2030. The World Bank estimates that the African food market alone could be worth $1 trillion by 2030, more than tripling the current $300 million market. Rising investment from China could change America’s status as a leading trading partner as African economies mature. Therefore, the United States must adjust its strategy in Africa to ensure its place as a future key trading partner and to achieve its foreign policy and development goals in the region.
African development needs are enormous. The African Development Bank (ADB) believes the continent requires between $130 billion and $170 billion a year in new infrastructure to meet its development needs, given the 12 million young Africans entering the job market every year.10 Closing this gap requires $67.6 billion to $107.5 billion in funding, even after considering all donor financing commitments. Without attracting more private capital or development assistance to close the gap, urgent needs cannot be met. Specifically, unreliable water access, sanitation, and health (WASH) and agricultural production are consistently identified as limiting factors in African economic productivity and as contributing factors in violent conflict. The opportunity for the United States, which has extensive agricultural knowledge and a history of successful food-security programming, is significant, even considering China’s escalating financial interests.
It is a challenging environment, characterized by increased but potentially unsustainable investment from China and growing African needs that must be met to ensure the continent is secure and reaches its economic potential. The best way forward for the United States is to demonstrate the strength and value of its development assistance model and deepen its relationships with partners across the region. Simultaneously, the United States and its allies should work through international institutions to encourage China to adopt policies that achieve shared global objectives in economic development, security, human welfare, and sustainability.
The US recognition of China’s expanding presence in Africa should be guided by intensified investment in African infrastructure that strengthens diplomatic relationships with African nations in which the United States has a presence; invests in sectors and locations where China is unable to operate effectively; expands agricultural trade with Africa while also investing in African agricultural productivity; and motivates China, through international engagement, to improve its own development practices.
The United States has a long, bipartisan history of supporting a wide range of development and humanitarian efforts in Africa. In recent years, there have been impressive results from addressing food and water security, specifically. Therefore, the rising investment from other economic powers should not slow US investment in Africa. The United States and China are actively engaging in programming in Africa. The United States should deploy a new strategy to ensure sustainable prosperity for both Africa and the United States.