Is a split in the works between Zambia and its long-time business partner, China?
- Lusaka faces a growing debt crisis, and hopes Beijing can help refinance some of its loans so that it can secure new credit from IMF
- Though the countries have a history of projects since to the 1970s, China ‘remains reluctant to engage in formal agreements on debt restructuring’
If there is an African country in which the Chinese have found a home it is Zambia. At the Kenneth Kaunda International Airport in the capital Lusaka, the first billboard that welcomes travellers is one advertising the services of the Bank of China.
Zambia, in south-central Africa, is one of the few countries on the continent where the government-owned Bank of China offers fully fledged banking services in the Chinese currency. Customers can even make deposits and withdrawals in yuan.
The bank has branches in Lusaka and in Kitwe, a town in the Copperbelt region, to serve the growing number of Chinese firms and immigrants living there.
A landlocked nation of some 17 million people, Zambia is said to host one of the largest populations of Chinese expatriates: investors, workers, merchants and farmers. Some sources estimate there are between 80,000 and 100,000 Chinese in Zambia, but the government puts the figure at under 20,000.
Like many other African countries, Zambia, a former British colony rich in copper and cobalt, has embraced China. In return it has received billions of dollars in investments.
Africa’s second-largest copper producer, Zambia was one of the first countries on the continent to receive a major infrastructural investment from Beijing. It took the form of the Tazara railway, which was built by China in the 1970 to links the Copperbelt to Dar es Salaam in Tanzania.
But this five-decade relationship has been put to the test in recent years. Short of critical funds to plug its budget deficit following a slump in the price of copper, which constitutes 70 per cent of its exports, Zambia turned to Beijing for loans.