Former President of Tanzania Jakaya Kikwete has said that the theory popularised by the western media regarding China allegedly laying a debt trap for African countries such as Zambia may lack substance.
According to a statement released to the media by Kellys Kaunda, the First Secretary for Press and Public Relations at the Zambian Embassy in Berlin, Germany, President Kikwete said the stark economic reality based on verifiable studies shows that the West benefits more from China than the entire African continent when it comes to Foreign Direct Investment or FDI.
“Studies show that more billions in terms of investment from China have currently gone to Europe than to Africa,” said former President Kikwete when he spoke at widely followed EAZ summit at the Avani Hotels Resort in Livingstone during a panel discussion.
President Kikwete gave a ball park figure of 30 billion pounds which he said has been invested in UK alone in recent years by China compared to only 60 billion pounds for the entire African continent of 54 countries over the same period.
This confirms the concerns of many pundits that feel China’s relationship with Africa regarding debt or investment are often mischaracterised or skewed in western media.
President Kikwete amidst nods of agreement at the EAZ conference could not be drawn into rebuking China’s relationship with Africa.
Last year, President Edgar Lungu cautioned against ‘malicious media reports’ aimed at creating a rift between China and Zambia over debt or FDI.
President Lungu said, “Zambia will choose its friends on its own terms” not based on foreign media theories of ‘debt traps and dishonesty.’
Zambia like Tanzania has enjoyed a 55-year undisrupted relationship with China from building the TAZARA in the 1960s to currently completing the ultra-modern Kenneth Kaunda International airport plus thousands of kilometres of roads in Zambia today.
Criticism abound from the Western media regarding the China Zambia relationship but President Lungu has remains unequivocal Zambia’s international relations.
What the studies show on FDI in Africa and West
While the hype is that Africa was getting huge amounts of development money from China, studies show the exact opposite is the reality with the West actually getting a lion share of China money.
The “Big Three” EU countries, and not Africa, got most of Chinese money in 2018 alone: United Kingdom bagged 4.2 billion euros, Germany 2.1 billion euros and France 1.6 billion euros.
That’s a far cry for projects such as Zambia’s KKIA or indeed the road works according to studies.
In fact the same study from Rhodium Group and Mercator Institute of China studies or MERICS says the two ‘new top recipients’ of huge Chinese money now are still not Africa or from Africa, they are: Sweden and Luxembourg.
A Forbes study shows that contrary to popular belief, China money is not even as far out spread in Africa as is in the west, with for instance Chinese investment in Africa being lower on average than in other regions away from Africa.
Forbes study says Chinese investment in Africa averages 1.78 people for every $1million compared to 2.24 people for every $1 million in regions other than Africa.
The business forum dubbed National Economic Summit at Avani on the banks of the Zambezi River and Victoria Falls under the auspices of the Economic Association of Zambia was graced by President Edgar Lungu, Kenya’s President Uhuru Kenyatta and President Kikwete.
Zambia’s Ambassador to Germany H.E Anthony Mukwita who followed the discussion closely as a participant described the summit as a start to greater practical economic solutions.
Zambia’s Finance Minister Dr Bwalya Ngandu said if more action and less talking occurs after the event, Zambia could be on the right and positive economic path.
Others that attended the event from Zambia’s diplomatic corps are Zambia’s Ambassador to Ethiopia H.E Emmanuel Mwamba and Ambassador to Israel H.E Martin Mwanambale.
Dr Lubinda Habazoka, the EAZ boss says the next business event will be held in Livingstone next April after describing the first event as a success.
Albeit China was not the elephant in the room, it sure provided the discussion line for the event once the topic was raised to President Kikwete by veteran broadcaster and former diplomat Frank Mutubila.
Correct sir!!!
Tanzania had stable minded presidents, and they leave office without prosecutions.
What went wrong in Zambia we, have been getting wrong ones, just because the good ones die off doesn’t mean should just vote for the one shedding most tears.
Ba reporter nabo ubufi! Ati:
Zambia’s Ambassador to Germany H.E Anthony Mukwita who followed the discussion closely as a participant described the summit as a start to greater practical economic solutions.
You are sure he followed it closely? How can you prove this? Dont report what you cant see
It is not the amounts of borrowing from China that concerns , it is the terms of repayment and the costs that are covered in corruption.
For the same amounts borrowed or investments from China , some African countries like Zambia end up paying 10 times more then western countries bavk to China for the same amounts because the borrowing is done by corrupt people who also want to enrich themselves.
Like Zambia’s $275 million digital migration , pure theft by lungu and his gang at the expense of the country
Spaka. Be constructive sometimes. Find another scapegoat insteady of Lungu all the time. You sound like a broken record or an empty teen sounding the same all the time. “some African countries like Zambia end up paying 10 times more then western countries bavk to China”. Provide facts and you will earn my respect. But jumping at anything where you see the name Lungu is not the solutions to your mental issues. HH will never ever rule Zambia, mark my word. Period.
Abena
Ati provide facts ???
If you think being billed for new state of the art studios in all provinces in that $275 million bill then only reciving 5 outside broadcast vans is not stealing , you are dummer than dummer.
Zambia’s digital migration is the most expensive in africa and the Chinese still control all revenue streams in broadcast platforms,
Lungu filled a plane with his gang and went to China to sign for that loan against the advice of international media exerts.
Facts are all in front of your nose but typical of PF rats ati provide facts ?
This situation is like when a chicken goes missing and bones are found , you still demand proof that the chickens is dead…..
Ba koswe
Where is abena who wants facts ??
Let me give you facts of lungus and PF stealing
……we were billed for Morden studios to be built in all provinces in that $275 million bill , buildings that should last for 100 years , yet you get provided for with 5 outside broadcasting trucks that will last maximum 10 years ?????
If you don’t see anything wrong in that, we are doomed.
Zambians have short memories. At one time Zambia was highly indebted to the tune of 7 billion US$ with nothing to show which literally went down the drain through free mealie meal coupons.
I was expecting a decent response from Spaka. But it seems UPND cadres are not able to debate or discuss without using dirty words or insults. It is you who is doomed. i am fine and successful and just trying to help by providing positive debate and discussion here. It seems you are all like your leader, bitter and full of hate. Ati “Lungu filled a plane with his gang and went to China to sign for that loan against the advice of international media exerts.” First and foremost it is not Lungu but his excellence the President of Zambia Dr. Lungu (we elected him).Whether you like it or not, that is a fact. Learn to respect others if you want to be respected. Wondering when will UPND followers grow up. They are all like their leader Under 5.
Just dispute what I have said , did lungu not fill a plane with his cader gang leaving out the broadcasting minister to go and sign that loan ???
We are paying for studios in all provinces but instead were given 5 broadcast trucks ????
There’s nothing wrong with borrowing. Just make sure the capacity to make repayments is there. That is what we really need to work on, especially compared to countries like the US where just a single state can generate billions of dollars per annum and they still haven’t defaulted on their loans despite these being in the trillions of dollars.
Bwana JK, what about selling land in Serengetti or Kilimanjaro Hotrel in exchange for three Armani suits and 2.5 million USD?
Your “assayers” of gold ore declaring less than 2% whilst true content was in excess of 8% when checked by Magafuli?
Almost forgot, what about kick-back from Comrade Xi for Bagamoyo port?
Just keep mum, it is better not just for you but also for your predecessor.
I agree with all those saying in Africa and particularly Zambia our leaders overprice a lot of projects when they borrow with the aim of enriching themselves and so it seems like European countries borrow from China on better terms. In European countries there’s almost no corruption. If you go to Europe and find out the cost of building a road the same stretch as Lusaka-Ndola you would be shocked at the cost(much less than $1.2bn)
Our leaders don’t overprice projects. They’re duped into signing up high interest loans and high priced projects for a little kickback. The corruption in Zambia will be our undoing.
WE NEED TO REVISIT OUR NATIONAL ANTHEM. “STAND AND SING FOR ZAMBIA PROUD AND FREE LAND OF WORK AND JOY IN UNITY”. WHERE IS THE PRIDE WHEN WE DEPEND ON FOREIGERS FOR 99% OF OUR NEEDS BECAUSE YOU CAN’T BE IN DEBT AND BE FREE. WE NEED TO WORK IN UNITY TO IMPROVE OURSELVES AND BECOME SOVEREIGN NOT JUST IN WORD BUT IN EVERY SENSE OF THE WORD. WE ARE WHAT IT WILL TAKE TO BE GREAT. PUT ASIDE OUR SELFISH AMBITIONS WORK AS ONE TO CHANGE THE IMAGE OF OUR MOTHER LAND. WE ARE IN DEBT IT DOESN’T MATTER WHAT THE CHINESE OR THE WEST THINKS IT SO WE NEED NOT TO DEFEND EITHER RATHER LET’S WORK TO RISE ABOVE ALL THAT. LET THEM SAY THEY OWE US
Loans for infrastructure development in African countries are not investments. China investment in Western countries is for productive units where prifits are externalused back to China.
Wake up!
Abena while you condemn spaka for what you posit to be lack of insight on his part – ”empty tin”- you go on to make a statement – “HH will never rule zambia”. Making such a statement is not only hypocritical, but a serous inability to think rationally & critically, especially for one trying to preach the same. You sound more of an empty tin than the person you are mocking.#walk-the-talk.
Regarding the subject of debt trap that china is setting for African countries; that the theory lacks substance, i believe to the contrary. Firstly, i always assume that there is atleast partial truth in commonly held beliefs -endoxa. The reason most people believe is a debt trap is simple – why continue giving loans to nations who have exhausted their cabability to repay?
You got me wrong. HH has lost six times. The statement i posted is based on that fact at hand (losing six times). Therefore i have very good reason to assume that he will never stay in State House. Show me in my posting where i talked about Spaka not having insight? If you have nothing to post don’t just defend other people’s postings. Post your own. Do you understand the words you are using “hypocritical, but a serous inability to think rationally & criticall”. Mwamba i think you need to rethink and read what you post to see if you make sense.You have failed to self reflect because you are blindly defending somebody who has never ever allowed elections to be held in his party to challenge his leadership. I would rather debate and discuss with Spaka than his spokesperson. Thank you.
Abena
Nearly all Chinese projects in Zambia are over priced , not because of the Chinese but because of a long line PF caders getting a cut…..how can one agree to pay $4.5 million for a simple toll gate ??
At the end of the day lungu is told about all these costs and signs them off……who do we blame for this grand ripoff of public money ???
Sometimes we misunderstand the west.
I think; abut China, lending to Zambia they are canary in a coal mine is an advanced warning of some danger of predatory lending.
No one wants to talk about the workforce in our country, why China brings its own work force?
“Predatory lending includes any unscrupulous actions carried out by a lender to entice, induce and assist a borrower in taking a loan that carries high fees, a high-interest rate, strips the borrower of equity or places the borrower in a lower credit rated loan to the benefit of the lender”.
Google loan calculator is free on Internet.
The problem with the West is that they think African countries cannot make it without them.
This has been their notion ever since they intruded into our environment with their racist concept of “use and refuse”. Now that they see us shaking off their shackles of economic slavery and becoming partners with China (the Dragon), they naturally get worried because they know that they can no longer easily bully us with the Dragon behind our back.
The west is more concerned with the fact that while they provide donner aid in the billions to Africa , African nations are diverting their resources to payoff hudge Chinese debts….
A situation in which a debt is difficult or impossible to repay is a debt trap. it’s not a theory its factually proven, china isn’t victimizing African countries We are our own oppressors. Lusaka times you are a trash news outlet
Abena when I say you are not thinking critically & rationally, am vindicated by your statements. Such as “ He has lost 6 times so he cannot win”. Really! My expectation was that you going to look at a guy who has lost 6 times and refuses to give up in a different frame. Not giving up is one of the hallmarks of success. You should have given that a thought at least. But it seems you are emotional. Am not here to support politicians, but I will make you understand that I want to encourage rational and innovative thinking. Politics is very low for my principles.
Mwamba, where i am if a political party loses elections then the guy at the helm either resigns to allow others with fresh ideas to take over. If he does does not want to resign then it is a MUST that new elections must be held to choose new leaderships for the next national elections. You dont rally forever behind a driver who only promises you the destination but fails to reach there. Your leader has lost 6 times and has no decency to vacate the leadership seat!!!. Let alone announce elections to test his popularity in his party!!!. Can you not see dictatorial tendencies in your party leader ! What makes him think that the people of Zambia want him when he has never put that to the test even in his own party. How does he expect the non UPND people to believe that they are not voting…
Abena ni mbuzi, you can’t reason with him.
Spice, Dont insult. Learn to debate and discuss without insulting. We all know how to insult. this is not that platform. Differing in opinion with somebody does not make that person mbuzi. Thank you
Completely lost robbing politicians. There is a huge difference between investment and loans. There is still bigger difference between doing productive investment than debt trap to do shoddy roads, not needed false egoistic projects to appease the ego of political morons. Where is the need for Lusaka and Ndola overpriced airports? What is left of $5 billions pumped into roads that are already gone in less than 3 years? Who makes these mor.ons presidents of countries?
In short EU has concrete clear rules of min and max interest on pay back loans even for the locals. Look at Zambia, the interest rates are so high that it takes centuries of mental stress for the Zambians to pay back the local bank loans. So , when you deal with Romans do what the Romans do”. Africa should implement the concrete law enforcement on the min and Max loan interest thereafter they will be able to show the Chinese that we are not ready for any rp off deals.
I think Kikwete’s thinking is flawed when you look at the investment that china makes in the western countries try also to look at the conditions attached, you will not find the silly conditions that are given to countries like Zambia in the west, were you can literally see that the country is slowly being taken over.
I think there is misunderstanding between what is being said and what is being reported. Therefore, we end up comparing an elephant with an elephant shrew. Despite similarities in names and both being mammals, these are two different animals. The GDP of UK is roughly around 2.6 Trillion dollars (Africa as a whole is around $2.3tr). Therefoere, UK borrowing $60bn represents only 2.3% of its GDP. Zambia borrowing just $4bn represents 26% of our GDP. Second, the other issue is of investment vs debt. Sweden is getting Chinese money in investments and not loans. Add to that, Sweden has strong institutions backed by EU power therefore it cannot be compared to China loaning money to Tanzania or Zambia. This article is misleading. Yes, there are biases in international media but the issue of date…
China has for example invested in Sweden which has helped Sweden (a $400bn economy) to grow and create jobs for EU members etc. This is not the same with Zambia which has over borrowed almost beyond our paying capacity. The discourse needs to acknowledge both positions.
The Western Aid conspiracy theorists, base their spin on China Aid on how the West treated Africa in the past and presently, In short, they can’t think any differently to how they are conditioned.
Giving Aid to Africa was their way of controlling accessing resources at rock bottom cost as interest rates and economic climate turns negative.
China, is a friendly lender that actually invests in the economies and their presence in the countries they invest in is visible. They provide help when economic climate turns down, writing off loans to manage the debt. That’s a friend indeed.
Kikwete’s brain performance is highly questionable may be it’s due to small education. How could a person who ruled a country fail to differentiate between debt and investment. Sweden for example does not borrow Chinese money to build roads by Chinese contractors no she attracts Chinese investments to created jobs for her nationals. Lunatics like Abena stop personal attacks against presidential aspirants if HH doesn’t rule Zambia so what? What if he does what are u going to do?