Xi Jinping plays up roles for private sector in China-Africa trade and finance

Chinese President Xi Jinping appears to be banking on the private sector to drive the next phase of China-Africa cooperation as China’s policy banks take a cautious approach to lending.

Speaking via a video link from Beijing during the Forum on China-Africa Cooperation (FOCAC) on Monday, Xi outlined nine initiatives China planned to implement in the next three years, most of them relating to providing coronavirus vaccines, growing trade and encouraging private Chinese companies to invest in Africa.

In a clear sign that the private sectors of both sides would play a bigger role in the China-Africa relationship in the next three years, Xi pledged US$30 billion for trade finance to grow imports from Africa, provide credit facility to African financial institutions to lend to small and medium enterprises in African countries and would share part of its International Monetary Fund’s special drawing rights (SDR) with African countries.

During previous FOCAC meetings, China has traditionally announced huge financial packages where Chinese policy banks advance billions of dollars into Africa’s infrastructure. This was mostly done under the Belt and Road Initiative, Xi’s pet trade and infrastructure development plan.