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China's Loans to Africa Are Help Not Harm
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By Li Xujiang

Last November, China promised African countries US$3 billion in preferential loans and US$2 billion in preferential buyer's credits. During the African Development Bank meeting in Shanghai in June, China unveiled a US$20 billion package of loans to Africa.

These deals have received criticism from G8 members, saying their large size could put new debt burdens on African countries and even lead to another debt crisis, and that the loans could undermine Western countries' debt relief attempts. China's increasing trade ties with Africa are also accused of undermining the West's efforts to promote good government and resolve conflicts.

"It is unreasonable for the West, the IMF, the World Bank or any other international organization to oppose China's loans to Africa," Professor Li Baoping, an expert on Africa studies in Peking University, said.

China is not the biggest lender to Africa. And it has never put extra terms on loans or put pressure on the paying of debts. Most of the loans to Africa have been canceled.

For example, China canceled about US$1.4 billion debts to 31 underdeveloped African countries. That would not add to their debt burden.

Besides, China's loans and other aid to Africa mainly go on the construction of infrastructure, farms, factories, as well as stadiums, conference centers, hospitals and schools.

These constructions are useful for strengthening the self-developing capability of African countries, Li said.

In fact, the economy in Africa has improved a great deal over the years.

Statistics show that Africa has been developing continuously for more than a decade with average annual growth being 5 percent over the past three years. The IMF estimates Africa's growth is edging toward 6 percent, its highest in 30 years, and China's increasing trade and investment help African countries to be more involved in world trade.

China is not the only country in the world that has been providing Africa with loans and aid. So why is it singled out as endangering Africa with debt woes?

The only difference between China's loans and those of other countries is that China's loans have no terms attached. That makes loans from China more attractive to African countries than those from Western countries or the World Bank.

"We would rather take loans from those who don't set conditions. In the past few years, this has often meant China," Jeremy Goldkorn, a reporter from South Africa in China, said.

The loans to Africa from some Western countries and international organizations have strict conditions and have been proven unsuccessful in most countries. Years of aid from the West not only failed to prompt economic growth but propped up corruption and inefficient governments.

China is becoming closer to Africa than the Western countries are, and that worries them.

"The Western countries think China has spoiled their efforts to impose the so-called good government in African countries by taking away from the West its advantageous position in Africa," Li said.

What some Western countries do to punish countries that, in their opinion, have problems with "democracy", "good governance" can only harm local people without solving the problems, Li said.

"We must also see that since the independence of these African countries they are improving, politically. We cannot judge these countries which have only a little more than 40 years of history by the West's standards," Li said.

China's aid to and cooperation with African countries are built on respect, respect for their internal affairs and self-development. That's also why China is favored by African countries.

"Among African countries' ruling elites, there is a great deal of enthusiasm for China's involvement in Africa because many people see China as a development partner that is not tainted by a history of colonialism, a partner that does not 'talk down' to African countries," Goldkorn said.

The criticism over China's aid to Africa comes at a time when China and Africa are enjoying a rapidly growing cooperative partnership and the economic ties between the two sides are getting ever stronger.

Since the establishment of the Forum on China-Africa Cooperation in 2000, trade and investment exchanges between the two sides have increased enormously. China's trade with Africa totaled US$40 billion in 2005, up 35 percent on 2004. It is estimated the figure will surpass US$50 billion this year and will double by 2010.

The author is a graduate student at Beijing Foreign Studies University.

(China Daily via agencies August 13, 2007)

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