Angola's debt to China is estimated at USD 20.1 billion, and is the country's largest creditor, said Finance Minister Vera Daves on Friday.

Of this amount, USD10 billion was used to capitalize the Angolan oil company Sonangol and the remaining USD 10.1 billion to finance various investment projects.

Speaking at a press conference, Vera Daves said that the issue of China's financing to Angola has generated a lot of controversy when analyzing the quality of the works carried out by Chinese contractors.

However, the minister explained that the quality of the works does not depend on the creditor - Chinese banks - but on the Angolan State that must inspect them, and on the contractors.

Vera Daves said that upon payment, the paying bank is based only on the invoices presented on the execution of the works. The bill is paid in China and the money does not circulate in the Angolan economy.

"There is always a very strong debate about deliverables, the quality of the works. This does not depend on the financier but on the relationship between the Angolan State and the contractors", she said, explaining that the financing entity, which is a bank, focuses on the invoices and not on the walls.

As for the debt service with China for 2020, standing at USD 2. 678 million, the minister said that the amortizations represent 78.8%, that is 2,103, while interest represents 21.2% (567 million).

She explained that the debt with that Asian giant is commercial and is paid in deadlines of up to eight years, unlike that with the IMF, which allows negotiation of interest rates and repayment terms.

On the discharge of the public debt, estimated at about 90% of GDP and 60% of the General State Budget 2020 (AKz 13.5 billion), ie, USD 5 billion, according to analysts from the Fitch Rating Agency, the director of Public Debt, Valter Pacheco, Angola needs at least 29 years.

However, the official explained that this is just a hypothetical example should the country no longer incur any debt. But this is not the case because the country needs to finance itself to meet needs.

"We will continue to go into debt, but in a more productive and responsible way. Angola will have to continue to finance itself, but with lower interest rates and longer terms ", said the official.

 

Source: ANGOP

The United States accounts for one of the highest number of billionaires besides hosting the richest person on the planet. The immense fortune by American billionaires can be seen clearly when compared to counterparts from other countries.

Data presented by Buy Shares indicates that the $609.3 billion combined fortune of five richest Americans is more than the cumulative wealth of five richest people from China, Russia, and India at $463.6 billion. The 20 rich people overviewed from four countries now control a combined net worth of $1.72 trillion. The data shows that the top five richest Americans also hold the same position globally.

From the data, Jeff Bezos is the world’s richest person with a staggering net worth of $205 billion as of August 26, 2020. His wealth is almost double the size of the combined fortune of the five richest people from Russia which stands at $112.4 billion. Bezos is also $88.8 billion richer than Microsoft founder and philanthropist Bill Gates who ranks as the second richest person in the world.

World Weathy in US

World Weathy in US2

Billionaires among Covid-19 biggest gainers

Most of the global billionaires are spread across different industries with finance and investment remaining the top niche. Notable finance and investing billionaires are Warren Buffett who emerged as the fifth richest person in the world. The group also has an interest in fashion, retail, real estate, and technology.

It is worth mentioning that the wealth of overviewed individuals is estimated based on their documented assets and accounting for debt and other factors. The billionaires on this ranking excluded individuals whose wealth cannot be fully ascertained.

During the coronavirus pandemic, the global billionaires are among the biggest beneficiaries. For example, Jeff Bezos crossed the $200 billion mark, a record milestone since Amazon was among the biggest beneficiaries of the pandemic. In the course of the health crisis, Amazon largely benefited as consumers turned to online retailers for essential goods. Bezos’ personal wealth is mostly in Amazon stock and it has been skyrocketing in recent years along with the company’s share price.

Notably, Bezos’s wealth could have been much more were not for his expensive divorce. Last year, Bezos parted ways with ex-wife, MacKenzie Scott, and agreed to give her 25% of his Amazon stake. Based on the current market, the stake is worth $63 billion.

However, Bezos alongside other billionaires in the technology industry is expected to be among the biggest gainers this year. In the wake of the coronavirus pandemic, the technology sector has shown positive recovery signs with stocks surging. The surge in tech stocks has seen Facebook founder Mark Zuckerberg’s wealth also grow to new heights.  Unlike some wealthy people like Facebook’s founder, it took a lot of time for most people to make their first billion.

Are billionaires benefitting from weak tax laws?

On the flip side, the rise of global billionaires has also been marred with some controversy, especially on tax-related matters. In the US, taxing the wealthy has been a major debate that has gone into political circles. There is a general feeling that some of the wealthy gate away with fewer taxes. In the wake of the coronavirus pandemic, millionaires and billionaires were set to reap more than 80% of the benefits from a change to the tax law as part of the coronavirus economic relief package.

Most billionaires usually combine their huge investing and purchasing power alongside government resources in addition to their own resources to profit from during economic crises. In addition to wealth-friendly tax laws and loopholes, some of the richest individuals are able to stay on top.

However, there have been concerns about how some billionaires keep getting rich. Some suspect that billionaires are engaging in unethical practices to attain much wealth. There have been calls for top billionaires to redistribute their wealth. At the same time, there is a school of thought that supports the close scrutinization of billionaires. For example in the United States, Congress has been urged to set up a “Pandemic Profiteering Oversight Committee” whose sole purpose will be to probe corruption and profiteering by a few individuals.

In the past few days, the public space has been awash with comments and outrage on the hearings at the Federal House of Representatives concerning the Chinese loan agreements Nigeria entered into to the tune of $500 million for the part-financing of its rail projects said to be valued at about $849 million.

This is borne out of the fact that the House of Representatives Committee raised the alarm over the alleged waiver of Nigeria’s sovereignty. These hearings in which the Minister of Transportation, Chibuike Amaechi was invited, laid bare some perceived inconsistencies in public debt procurement process in Nigeria with noticeable gaps. For the rail project loan in question, issues have arisen concerning the drafting of the agreement, the processing of the documents as well as the involvement of the Minister of Finance and the Attorney-General of the Federation respectively.

These gaping questions become very disturbing when the lender in question here is China, which has been associated with opaqueness in granting loans to countries in global context.
 
In investigating the processing of the $500 million Chinese loan from the Export-Import Bank of China, the Federal House of Representatives, as part of its oversight function, discovered that the loan agreement contained a clause in which Nigeria’s sovereignty was supposedly traded off. According to reports, this discovery was made because the agreement entered into, was written in Mandarin, the official form of the Chinese language with the Nigerian officials signing without understanding the full content of the loan document. If that is the case, it strengthens the narrative of the reported opaqueness of typical Chinese loan agreements.

The controversial clause in this loan case, states that, “the borrower hereby irrevocably waives any immunity on the grounds of sovereign or otherwise for itself or its property in connection with any arbitration proceeding pursuant to Article 8(5), thereof with the enforcement of any arbitral award pursuant thereto, except for the military assets and diplomatic assets.” The question that arises here is whether there is no law that requires that the terms and conditions of loan agreements be submitted to the National Assembly for approval. In response to this raging controversies, the Chinese Foreign Ministry denied that China had any clause in the contract ceding Nigeria’s sovereignty and that it followed its “five-no” approach in loan agreements one of which is “no imposition of our will on African countries” and that it gives full consideration to debt sustainability.  

The response of China on this issue notwithstanding, the history of China’s relations with different countries on loan agreements largely leaves a sour taste in the mouth. China has been severally accused of undertaking a global colonisation policy with its debt-trap diplomacy. For most of the countries that China has extended loan facilities to, there has been tales of woe and lamentations. Chinese loans to Sri Lanka, Papua New Guinea, Maldives, Pakistan, Malaysia, Mongolia and Republic of Kazakhstan, among others have been followed with cases of default and takeover of these countries’ assets by China.

These loans are usually given out with very attractive conditions and without thorough due diligence for which these countries find it difficult to resist. What follows is a loan default and then the taking over of major assets in the borrowing countries with these takeovers not limited to the projects for which the loan is procured. By its “Belt and Road” Initiative, China targets countries that have some form of natural resources or something to offer which may not necessarily be cash. One commonality in these assets is that all the infrastructure of roads, ports, highways and airports, among others, financed with these loans all connect to China in what has been aptly described as the “new silk road.” Opaqueness has been one clear characteristic of Chinese loans across many jurisdictions globally. In Africa, the story is not different.

China appears to have taken a strategic position on the continent by willingly donating a mighty Secretariat to the African Union Commission in Addis Ababa, Ethiopia, probably as a good launching pad to gain easy access to virtually all African countries in pursuit of its global expansionist policy. China has extended irresistible loans to many African countries with Angola, an oil rich nation, having the largest Chinese loan exposure on the continent with a portfolio of about $25 billion. This is followed in that order by Ethiopia, Kenya, Republic of Congo, Sudan, Zambia, Cameroun, Nigeria, Ghana and the Democratic Republic of Congo, (DRC).

Most of these loan transactions have run into some trouble with Zambia representing the worst case in Africa where China has taken over their National Power Corporation and the Broadcasting Corporation due to loan default. It is little wonder why these countries wouldn’t default given that the loans are largely concessionary with lots of suspected undercover dealings and perks in favour of African government officials in form of huge kickbacks, which largely do not go through the banking system. Many have dubbed this as China’s new colonial strategy, which it executes by first encouraging indebtedness on very concessionary terms; taking over strategic assets or the commanding heights of the economy on default. The focus is largely on very corrupt countries with very weak governance structures. Given these antecedents, there is a great need for these issues to be addressed in the Forum on China-Africa Cooperation (FOCAC) meetings. 

The Debt Management Office (DMO)’s response on this raging issue has also left much to be desired. It addressed the pedestrian issue of how little China’s $3.121 billion loan exposure to Nigeria is, that it represents only 11.28% of the total external debt stock of $27.67 billion or 3.94% of overall total public debt burden of $79.303 billion. By this submission, the DMO stated that China is not a major source of funding for the Nigerian government. The DMO highlighted the fact that the loan is a concession of 20-year tenor with a seven-year moratorium. The DMO prided itself that its law, the Debt Management Office Establishment (ETC) Act 2003 as well as Section 41 (1a) of the Fiscal Responsibility Act 2007 were duly followed in the loan agreements in question.

However, the issue is really not in the quantum of these Chinese loans but on the commitments made by our government officials. The DMO response did not guarantee whether transparency was followed in the negotiating process –particularly with reported incidences of corruption in other jurisdictions. It also did not clearly state whether the unpalatable experiences of other countries in dealing with China on borrowing were factored in nor did it address the issue of sovereignty or whether the agreement was written in Mandarin or not nor how the repayment will be made from proceeds from the projects over the 20-year loan period. How come the National Assembly, which should have approved the loan in the first place is just getting to know about this sovereignty clause after the fact? The DMO needs to provide further explanations on these issues.
 
On the sovereignty issue, it needs to be noted that, the controversial clause would only come into effect when there is a case of default. It needs to be put in proper perspective that for an economic or commercial transaction, Nigeria would find it difficult to plead its sovereignty in the event of default and would thus need to go for arbitration. Hence the hue and cry on loss of sovereignty for a purely commercial transaction may have been misplaced. This, however, differs in the case of political relations where the ceding of sovereignty is not tolerable. It is proper to understand that for an economic or commercial transaction such as this, the key issue is to avoid a loan default else the case of arbitration cannot be avoided.

The critical point to make is whether Nigeria is safe with this preponderance of loans, particularly from China, given our track record in public debt management since independence.
 
It can be recalled that Nigeria had to exit the Paris Club debt during the Obasanjo administration by paying off $12 billion at a go and getting a relief of $18 billion totalling a reduction of our public debt by $30 billion. Are we sure there would not be a default again given our unenviable track record in loan repayment, particularly with the global oil market highly volatile and foreign exchange earnings dwindling. Corruption or kickbacks by government officials across the continent indicate that the actual investments in projects actually fall far short of negotiated loan amounts. This is a cause of worry concerning future default on these Chinese loans. This is where the sovereignty issue becomes obviously threatened.
 
Finally, does Nigeria actually need these many loans it has been taking particularly in the past five years since the inception of the Buhari administration in May 2015?
 
This government is known to have more than doubled the size of the public debt from about N12.118 trillion in May 2015 to N27.401 trillion in 2019 and in excess of N30 trillion at the moment. With the new borrowings of $3.4 billion from the IMF, $750 million from the World Bank, N162.5 billion Sukuk bond and another $1.5 billion from the World Bank, the Buhari administration is setting an inglorious record of ensuring that the future of the present and future generations is thoroughly mortgaged with dire consequences for the ordinary man. Currently, the cost of governance hasn’t been reduced and many stakeholders such as the Nigerian Labour Congress (NLC), the Trade Union Congress and many other stakeholders have called on the Buhari administration to make full disclosure of all the loans it had obtained. A stitch in time saves nine. The House of Representatives as well as the Senate should dig deep into these vexatious issues concerning Nigeria’s loans so that the current race on the road to economic and political perdition can be reversed.
 
1 USD = 386.594 NGN
 
The Chinese government says there’s no clause in the $500 million loan it gave to Nigeria that include taking over its sovereignty.
 
The House of Representatives had in the probe of Chinese loans to Nigeria alleged that the agreements ceded Nigeria’s sovereign right on the assets financed by the loans to China if there was payment default.
 
However, the Chinese foreign ministry in a statement debunked the claim saying the country had no such plan.
 
“We follow a “five-no” approach in our relations with Africa: no interference in African countries’ pursuit of development paths that fit their national conditions; no interference in African countries’ internal affairs; no imposition of our will on African countries; no attachment of political strings to assistance to Africa; and no seeking of selfish political gains in investment and financing cooperation with Africa,” the ministry quoted President Xi Jinping, as saying at the FOCAC Beijing Summit in 2018.
 
The ministry added that “China is committed to enhancing investment and financial cooperation with African countries based on their needs to help them improve infrastructure and extradite socioeconomic development.
 
By funding infrastructure and other areas that lag behind for short of money, we have helped the relevant countries break bottlenecks, enhance their capacity for independent development, realize social and economic sustainable development, and improve people’s livelihood.
 
Such cooperation has delivered tangible benefits to African countries and peoples.
 
“In the process, China always gives full consideration to debt sustainability and seeks mutually-acceptable proposals through equal and friendly consultations.
 
That is the fundamental reason behind the enormous popularity of China-Africa cooperation in Africa.”
 
 

source: dailytrust.com.ng

Huawei became the biggest smartphone player in the world in the second quarter for the first time, a new report by Canalys shows.

The majority of sales came from China as its international business suffers due to U.S. sanctions.

The Chinese vendor shipped 55.8 million devices, down 5% year on year, according to the research firm. Meanwhile, second place Samsung shipped 53.7 million smartphones, a 30% plunge versus the same period last year.

It is the first time that Huawei has snagged the top spot for a single quarter, an ambition it has had for several years.

But analysts cast doubt over whether this was sustainable given the fact Huawei’s overseas markets outside of China took a hit as a result of U.S. sanctions against the company.

Huawei sold over 70% of its smartphones in mainland China in the second quarter. Meanwhile, smartphone shipments in international markets plunged 27% year-on-year in the April to June quarter.

In Europe, a key region for Huawei, the company’s smartphone market share fell sharply to 16% in the second quarter versus 22% in the same period in 2019, according to Counterpoint Research. It is the third-largest smartphone maker in Europe behind Samsung and Apple, showing how Huawei’s global position in the second quarter was built on efforts to expand its share in China, the world’s second-largest economy.

Given the massive population of China, success there often propels companies to a large “global” market share.

“It will be hard for Huawei to maintain its lead in the long term,” Mo Jia, analyst at Canalys, said in a press release. “Its major channel partners in key regions, such as Europe, are increasingly wary of ranging Huawei devices, taking on fewer models, and bringing in new brands to reduce risk.”

“Strength in China alone will not be enough to sustain Huawei at the top once the global economy starts to recover,” he said.

Last year, Huawei was placed on the U.S. Entity List, a blacklist which restricted its access to American technology. That meant Huawei could not use licensed Google Android on its latest flagship devices.

In China, where Google services such as Gmail or its search engine are effectively blocked, it’s not a big deal as Chinese consumers are not used to using those products. However, in international markets, not having Google is a big blow.

That is one reason why Huawei’s rivals, which are still able to use Android on their devices, have grown in market share. For example, in Europe, Chinese firm Xiaomi saw its market share increase from 6% in the second quarter of 2019 to 13% in the same period this year, according to Counterpoint Research.

Huawei was forced to release its own operating system called HarmonyOS last year. But analysts have previously cast doubt over its success in international markets given the fact that it is missing key apps from the App Store.

The Chinese telecommunications giant faced further pressure this year from Washington. A new rule introduced in May requires foreign manufacturers using U.S. chipmaking equipment to get a license before being able to sell semiconductors to Huawei.

This could affect Huawei’s ability to procure chips for its smartphones. While Huawei designs its own processors, they are manufactured by Taiwans’ TSMC which could be affected by this rule.

China is considering retaliating against telecom gear makers Nokia and Ericsson if the European Union follows the United States and Britain in banning Huawei Technologies from 5G networks, the Wall Street Journal reported, citing people familiar with the matter.

Britain last week ordered telecom operators not to purchase 5G components from Huawei from the end of this year and remove all existing gear made by the Chinese telecoms behemoth from the 5G network by 2027.

Sweden’s Ericsson and Finland’s Nokia are among the most immediate beneficiaries of the U.S-led campaign against Huawei.

China's Ministry of Commerce is looking into export controls that would prevent Nokia and Ericsson from sending products it makes in China to other countries, the Journal reported here.

The retaliation would be a worst-case scenario that Beijing would use only if European countries came down hard on Chinese suppliers and banned them from their 5G networks, one person told the Journal.

The EU has so far not recommended a ban on Huawei but has issued a so-called “toolbox” of security standards that member states should apply while using suppliers considered to be high risk to build 5G networks.

Nokia and Ericsson did not immediately respond to requests for comment.

 

Reuters

This is a flashback. Just about a year ago, the tough speaking Ugandan President, Yuweri Museveni blamed the World Bank and the West as a whole for driving Africa into Chinese arms by their refusal to fund railways projects across Africa.

Hosting some Chinese officials then, President Museveni lashed at the World Bank for refusing to lend Uganda money to build a railway network,noting that the World Bank told off Uganda when it sought for funds, that countries that “build railways use own money.”

He said that such a statement from an economist purports to support Africa’s transformation through private-sector led growth shows that some actors are not serious. Museveni, who was in China for a four-day visit, told a meeting in Beijing that Uganda Railways tried to get money to fund railway construction from the World Bank but in vain.

“One of our engineers recently told me that the Uganda Railways tried in vain to get support from the World Bank until one official told them that countries that build railways do so with “their own money,” Museveni said. 

“How will the private-sector grow if it is bedevilled with expensive transport costs, expensive electricity costs or no electricity at all, expensive cost of money, etc.? It is against that negativity, that China’s solidarity should be measured.”

“As we gather here, therefore, we cannot forget to salute the Communist parties of China, the USSR, Cuba and the other socialist countries that constituted the third factor in our emancipation,” he said. 

Reality a Year After

A year after , Uganda appears to have fallen out with Beijing on railway financing. China was unwilling to commit such fund after the faltering experience of Kenya.

Kampala has eventually resorted to a mixture of private public sector funding of her railway revival. It has slowed down the SGR agenda and in turn opted for rehabilitation of the old guage lines.

Interestingly, the Ugandan government has engaged a western led consortium in the rehabilitation efforts. Just two or so weeks ago, the national government of the Republic of Uganda approved US$ 376M for the 215km Malaba – Kampala meter-gauge railway refurbishment project.

An additional investment of over US$ 12M has also been approved to purchase eight locomotives for the line and more than US$ 2.5M for routine repairs across the network.

This was revealed by Charles Kateeba, the managing director of Uganda Railways Corporation (URC) in a letter addressed to the parliamentary committee on matters of national economy.

According to Mr. Kateeba, the Malaba – Kampala meter-gauge railway refurbishment would not only bring to life cheaper means of transport but also help reduce the number of trucks on the roads which would consequently lead to the reduction of wear and tear effect on the East African country highway roads.

Furthermore, the government hopes that the Malaba – Kampala meter-gauge railway refurbishment will reduce cross-border road traffic and help to limit the transmission of any future pandemics such as COVID-19.

The ambitious Uganda Standard Gauge Railway (SGR) project

The above-mentioned investment is part of the ambitious Uganda Standard Gauge Railway (SGR) project which aims to improve freight connections particularly between the capital city of Uganda and the country’s eastern border with Kenya.

The project includes the redevelopment and reconstruction of the East African country’s dilapidated 1,266km, 1000mm-gauge network to standard gauge and extension of the network to approximately 1,724km.

All this will be done in four sections: Malaba – Kampala, Kampala – Mpondwe, Tororo – Gulu, and Bihanga – Mirama Hills.

The construction of the Tororo – Gulu section has already been contracted to Vinci Group subsidiaries namely Sogea Satom and the ETF.

The two companies will replace the entire section 375km meter-gauge railway with a standard gauge railway.

They will also be responsible for the production and installation of 200,000m3 of ballast and the replacement and repair of sleepers, rails, and fastenings.

 

Credit: Rail-Bus

Angola has cut the number of oil cargoes that it will ship to Chinese state firms to pay down debt to Beijing as it seeks to renegotiate repayment terms to deal with the crippling impact of the coronavirus, three sources familiar with the matter said.

Angola said this week it had asked for G20 debt relief and was in advanced talks with some countries importing its oil on adjusting financing facilities, but expects no further debt overhaul to be needed beyond this.

The sharp global economic slowdown due to the novel coronavirus pandemic pushed Brent oil prices to their lowest levels since the late 1990s and U.S. oil futures to negative territory for the first time in history.

The price drop has put heavily-indebted Angola into a fragile state as it derives a third of state revenues from oil.

By far, its biggest creditor is China. Analysts say Angola has over $20 billion in bilateral debt with the lion's share owed to China. Much of the cash was borrowed to build roads, hospitals, houses and railways across the southern African country.

On top of its Chinese debt, Luanda secured a $3.7 billion loan from the International Monetary Fund last year and state oil firm Sonangol has borrowed $2.5 billion from banks between end-2018 and mid-2019, the IMF said.

A global oil output cut deal led by the Organization of the Petroleum Exporting Countries (OPEC) has added to Luanda's woes.

As an OPEC member, Angola was pressured to cut oil exports starting from May. The result has left the country with fewer and lower-value cargoes to split between paying off its Chinese debt and filling its depleted coffers.

The sources said that China's state-owned Sinochem would receive five cargoes in July, down from the usual seven or eight, while the trading arm of Chinese giant Sinopec called Unipec would receive none.

Unipec typically receives two to three cargoes earmarked as debt repayment.

Sonangol, Angola's finance ministry, Sinopec and Sinochem did not immediately respond to requests for comment.

China's foreign ministry said on Wednesday that the relevant departments were in contact with Angola over its request for debt relief.

"These oil-backed loans create stronger interdependence (between lender and borrower) than traditional financing. This tactic of diverting cargoes is not new as seen elsewhere," David Mihalyi, a senior economic analyst with the Natural Resource Governance Institute, said.

Chad threatened to cut repayment cargoes to commodities trader and miner Glencore during a major loan restructuring in 2017. Similarly, Congo Republic has cut many repayment oil cargoes to Glencore and commodities trader Trafigura as discussions drag.

Angola is not the only African country heavily indebted to China. The IMF and ratings agency Moody's have raised concerns about debt levels in sub-Saharan Africa particularly with China.

 

Reuters

Racism against Nigerians – and other Africans – is not new in China. Africa-China history is marked by solidarity, but also dented by old and new racism. Nothing at this moment suggests that the current situation will drastically change.

Some recent events are low moments in the ever-oscillating relationship between China and Nigeria.

A video emerged on 10 April of a Nigerian diplomat in China, Razaq Lawal, publicly criticising his compatriots’ maltreatment in Guangzhou by Chinese officials. Lawal protested that Nigerians were kept in COVID-19 quarantine beyond the normal 14 days for Chinese citizens. Chinese officials were also seizing their passports. He pointed out that the Nigerian government did not treat Chinese citizens living in Nigeria any differently from its own citizens.

The video drew the ire of Nigerians and the Nigerian government. The speaker of Nigeria’s House of Representatives, Femi Gbajabiamila, demanded answers from the Chinese ambassador to Nigeria, Zhou Pingjian. At about the same time the Nigerian Medical Association was protesting a government decision to invite a Chinese medical team to assist in the fight against COVID-19.

Based on my research on relations between the two countries (especially in terms of labour relations) over the past decade, I believe that incidents like this may keep recurring. That’s despite the assertion by Nigeria’s foreign minister, Geoffrey Onyeama, that Nigeria would “take definitive steps against China”.

I identify three main reasons.

Why things won’t change

Official relations date back to February 1971, when Nigeria established diplomatic relations with China. But contact between ordinary Nigerians and Chinese predates the 1967-70 Biafran Civil War. Though some argue that China supported the Biafran forces against the Nigerian government, no post-war government in Nigeria has confirmed Beijing’s involvement.

Along with other African countries, Nigeria supported China as the genuine representative of the Chinese people in 1975. This led to the replacement of Taiwan at the United Nations. High-level bilateral visits followed, setting the stage for increased trade. Although accurate figures are difficult to find, Nigeria-China trade galloped from about $1.8 billion in 2003 to $13.5 billion in 2018.

As the relationship grew, more Nigerians established business and other relationships in China.

Nigerians’ maltreatment must, however, be understood within the broader maltreatment of Africans in China. This can be traced to the 1960s, when African students began to arrive in China. It intensified in the 1970s and 1980s when there were protests against – and by – Africans in China.

Coincidentally, a landmark incident that led to the death of a Nigerian happened in 2009 in Guangzhou, where Nigerians were recently maltreated. It led to protests by Nigerians and other Africans, “demanding justice from the Chinese police after officers chased the man out of a high-rise window in a tightening security crackdown on illegal over-stayers in the city this year”.

In 2012, there was another protest by Africans in Guangzhou over the death of a Nigerian in police detention.

It’s my view that Nigeria’s reluctance to call out Chinese actions over the years is the main reason why the status quo persists.

While publicly painting a picture of equality, China continues to dominate relations with Nigeria, as I observed in a 2015 paper co-authored with Bukola Ajayi. We see this in imbalanced trade, Nigeria’s growing dependence on China, and China’s growing importance in Africa. We also drew attention to the issue of counterfeit, adulterated and sub-standard drugs and other products imported from China into Nigeria.

Back then, I commented on Chinese labour relations in Nigeria and the challenges of fostering the International Labour Organisation’s decent work agenda. My paper pointed to the weakness of the Nigerian government to respond to the maltreatment of its citizens by Chinese companies. I argued that this created a space for both civil and uncivil responses by non-state actors.

In April 2020 – five years later – we witnessed another report of maltreatment.

The second reason is due to Chinese investment in Nigeria.

A good number of Chinese multinationals and small companies operate in Nigeria. Chinese companies in Nigeria are building much needed roads and railways, airports, and telecommunications infrastructure. There are currently about 218 registered Chinese firms in Nigeria. They are involved in construction, furniture, food and beverages, beauty, and product assembling plants, among others.

Meanwhile, Nigeria’s trade deficit against China remains huge. Between 2015 and 2018, for instance, the trade deficit stood at N6.83 trillion (which exchanges for about $17.5 billion today) in favour of China. This affirms that China benefits more at the moment. Though accurate data remains difficult to get, it is estimated that total trade between both countries between 2015 and 2018 was about $49 billion. This means that goods imported from China into Nigeria in that period were about $17.5 billion more than those exported from Nigeria to China. In any case, a significant amount of Nigeria’s export to China is a primary product: crude oil.

With the crash in the crude oil price and a global economic downturn caused by the new coronavirus, Nigeria needs Chinese investment and loans now more than ever.

The third reason concerns China’s financing of development projects.

China is a major financier of large projects in Nigeria. These include the $874 million, 187km Abuja-Kaduna rail; the $1.2 billion, 312km Lagos-Ibadan expressway; the $1.1 billion Kano-Kaduna railway lines and the $600 airport terminals in Abuja, Lagos, Port Harcourt and Kano.

An estimate puts the current cost of Chinese projects at $47 billion. Many of these are financed by Chinese loans. It will be difficult for a country that relies so much on China to take action against Beijing.

With the poor labour standards in China itself and institutions’ weakness in Nigeria to check periodic abuses of Nigerians by Chinese companies, the chances seem low that Nigerian politicians and government will – or can – seriously respond to Nigerians’ maltreatment in China.

What to do?

The latest treatment of Nigerians in China is a dent on Nigeria-China relations. But if relations are to make progress, at least two important issues must be addressed. First, the Chinese government must do more to educate its people, making ordinary Chinese sensitive to issues of racism.

Second, Chinese citizens in China must understand that their actions could have implications for their compatriots in Africa. This could affect China’s long-term relevance in Africa as a partner.

But these issues concern not just ordinary Chinese citizens. Racism may be a symptom of much bigger problems for the Chinese government. This could be an opportunity for the Xi Jinping government to learn, and more importantly act.The Conversation

 

Abdul-Gafar Tobi Oshodi, Faculty member, Department of Political Science, Lagos State University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

The number of convictions related to corruption in China nearly doubled last year, according to a report by Beijing’s top prosecutor, as President Xi Jinping ramped up his crackdown on graft.

According to the annual report from the Supreme People’s Procuratorate submitted to the national parliament, 18,585 people were prosecuted for crimes related to corruption in 2019, a 90 percent year-on-year increase.

Sixteen cases involved former provincial or ministerial-level Communist Party cadres, including former Yunnan party chief Qin Guangrong, who was accused of taking bribes.

The latest high-profile targets of the anti-corruption campaign include former shipbuilding executive Hu Wenming and ex-deputy national security minister Sun Lijun, who were both placed under investigation for “serious violations of discipline and the law” in May and April respectively.

Last year also saw a 50 percent rise in the number of cases involving Communist Party members transferred to prosecutors for investigation, according to the report, which was discussed Monday afternoon.

China is holding its delayed annual National People’s Congress this year, but with much stricter controls on access and many sessions closed to the media due to the coronavirus outbreak.

A total of 25,000 trials involving corruption, malfeasance and bribery were concluded last year, which led to 29,000 people being convicted, according to the Supreme People’s Court work report released Monday. 

More than a million officials have been punished under the anti-corruption campaign so far, which has been a cornerstone of Xi’s seven-year tenure.

Critics have accused the campaign of targeting Xi’s political enemies. 

The Supreme People’s Court also reported that there were 22 trials under the controversial martyrs’ law, which criminalises all insults to Communist heroes.

Several internet users and even an online comic platform have been punished since the law was introduced in 2018.

There was also a notable increase in the number of prosecutions last year for cyber crime and intellectual property infringement, at 33 and 32 percent respectively.

The report also said that more than 2,500 people were prosecuted for coronavirus-related criminal offences between February and April this year.

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