China-Africa forum

  stance of African leaders at the FOCAC meet in Beijing could guide India in developing its own partnership with the continent

WHY IN NEWS ? 

The ninth edition of the Forum on China-Africa Cooperation (FOCAC) is to take place from September 4-6, 2024, in Beijing.

 The event comes at a time when African nations are facing multiple issues such as 

• high inflation, 
• 
  
• currency depreciation, 
• 
  
• a heavy debt burden, 
• 
  
• unconstitutional military takeovers 
• 
  
• geopolitical challenges such as the 

1. Israel-Hamas WAR 
2.   Russia-Ukraine wars, 
3.  attacks by Houthi rebels on commercial shipping in the Mediterranean Sea. 

आफ्रिका की क्या कार्य सूची रहेगी और कितना एजेंडा सेट कर पाएगा ? 

USE of the FOCAC process for Africa is increasingly contingent upon Africa’s ability to set the agenda and take greater ownership of its strategic thinking. 

दोनों ही तरफ से अभी कोई बात सामने नहीं आई है 

There has been no statements and papers on Chinese strategies in Africa. 

But there is a glaring absence of corresponding papers or strategies from the African side. 

आफ्रिका अपनी बात बेहतर क्यों नहीं रख पा रहा ? 

• lack of African state capacities, 
• expertise, 
• and the political will to understand how China and the Communist Party of China (CCP) work. 

• African governments have been unable to tap the vast amount of cultural and linguistic expertise of China that exists on the continent. 
• 
  
•  African agency gets constrained, which results in the agenda being driven by the Chinese side and African negotiators being on the back foot.

African priorities at FOCAC 2024

चीन अफ्रीका से इम्पोर्ट करेगा ? 

 On the economic front, progress on Beijing’s ambitious goal to import $300 billion worth of goods from African countries between 2022-24 has been modest. 

अभी तक दोनों देशों के बीच ट्रेड  

As in data from “China’s General Administration of Customs, between January to July 2024, 

China-Africa trade increased to $167 billion, with Chinese and African exports amounting to $97 billion and $69 billion, respectively.” 

About two-thirds of that trade is dominated by raw materials.

work in agricultural industry  

Developing a sustainable and robust agricultural industry is an imperative. 

In Africa,the task of processing agricultural commodities and even doing basic processing at home such as roasting raw cashew nuts remain a challenge. 

Countries such as China and India which have similar experience of small-scale farming could step in to develop crops, fertilizers and pesticides that are suited to African conditions. 

They have the right experience and tools to support African agriculture to become more climate resilient. 

Developing satellite systems to improve weather forecasting is one way.

Green energy and industrial development 

are also important. African countries are encouraging their international partners to establish more refining and processing hubs. 

lithium refining  

1 In Zimbabwe, Chinese companies are compelled to do basic lithium refining in order to move up the value chain and produce battery-grade lithium. 

2 but some factors hamper the ability of international companies are  

1. electricity shortages, 
2. lack of power generation, 
3. and significant environmental, social and governance (ESG) costs 

China and African debt, lessons for India

China’s role in African debt sustainability is highly complex

$170 billion between 2000-22 loan 

 According to data from the Boston University Global Development Policy Center, Chinese loans to African governments and regional institutions amounted to around $170 billion between 2000-22. 

but China is not the main creditor in Africa’s debt

 Chinese lenders account for 12% of Africa’s public and private debt. 

debts are not disclosed in sovereign debt records 

A 2022 study by AidData showed that half of Chinese loans to sub-Saharan Africa are not disclosed in sovereign debt records, which complicates the estimation of debt levels.

 concerns of 

• opacity, 
• lack of transparency 
• non-disclosure clauses, China will not debt forgive or cancellation. 
• Instead, Beijing is more likely to end small, interest-free loans.

FOCAC meetings का कितना फायदा मिला आफ्रिका को ?  

In previous instances, ad hoc and poorly structured engagements from the African side at FOCAC meetings pushed the continent into a reactive stance rather than driving the agenda.

 Therefore, African governments are now looking 

1. to develop a coherent strategy towards China 
2. and harmonise African positions before the FOCAC summit. 
3. African countries will continue to de-emphasise aid, focus on trade facilitation, and aggressively pursue product value addition.

क्या भारत भी चीन की नक़ल कर रहा ? 

Observers often point out that Indian engagement in Africa tends to mimic Chinese patterns of engagement. 

लेकिन असल बात क्या है ? 

India is not influenced by the actions of any third country. The Indian model and way of doing business has its own comparative advantages in sectors such as 

• ICT, 
• human resource development, 
• agriculture and 
• pharmaceuticals. 

भारत को चीन - अफ्रीका से क्या सीख लेना होगा ?

First, India continue  engagement with Africa

 १ The last India–Africa Forum Summit (IAFS) was in 2015. Dialogues such as the CII-EXIM Bank Conclave, and India Africa Defence Ministers meeting have been held regularly.

 २ But if India wants to capitalise on the momentum following the inclusion of the African Union (AU) in the G-20 under the Indian presidency, it must hold the IAFS-IV at the earliest.

३ India-African Union Track 1.5 Dialogue could be set up to deliberate on issues of mutual interest. 

४ This must be done after due consultation with Africa’s eight recognised regional economic communities (RECs). On the African side, the host of IAFS-IV should be Addis Ababa, 

Ethiopia which is the seat of the African Union Commission. Additionally, the AU should look to establish a regional office in New Delhi to strengthen regular consultations.

Second,integration of African economies  

१ India could play a central role in strengthening the integration of African economies into global value chains and supporting Africa’s industrialisation. 

२ किस क्षेत्र में काम करें 

 agriculture, pharmaceuticals, and manufacturing. The idea is to set up manufacturing bases in African countries that will help to create employment and serve local markets.

३ invest in 

• farm mechanisation,
•  food processing, 
• irrigation, 
• establish cold storage infrastructure to prevent food wastage, 
• and continue to promote the use of ‘Triple A’ (affordable, appropriate and adaptable) technologies.

The third  private sector participation 

Subsequently, innovative ways of financing such as public-private partnerships, and blended finance are the way forward

. Indian strategic and business interests in Africa need to be clubbed together with the government supporting Indian banks and entrepreneurs with low-cost credit. 

This would help Indian firms conduct feasibility studies and detailed project reports to create bankable projects. Other forms of financing such as the EXIM Bank’s Trade Assistance Programme could help to augur trust and expand India and Africa’s banking relationship.

Technology use

Finally, India’s own digital stack, which includes biometrics, mobile connectivity and Jan Dhan technology, could help establish digital and physical connectivity with Africa. The Unified Payment Interface (UPI) and RuPay services are already established in Mauritius. 

Kenya, Namibia, Ghana and Mozambique have shown interest in utilising the UPI platform. Additionally, to strengthen Indian banking and reduce forex risk, rupee-based lines of credit must replace dollar-based ones. African nations lose billions of dollars annually in exchange rates. Therefore, making transactions that are currency-neutral is in the interest of both India and Africa.

African countries are increasingly taking greater ownership of their strategic thinking. Their citizens are demanding accountability from their governments to ensure that their economies move up the value chains. 

They are trying to change the narrative surrounding Africa by repositioning the continent as an investment destination. By gauging how African leaders engage and negotiate with China under FOCAC provides important lessons for bolstering India’s own partnership in Africa.

source the hindu