By Grant T. Harris

This week, China hosted leaders from across Africa for a summit in Beijing. The last summit was held in December 2015 in Johannesburg, South Africa, where Chinese President Xi Jinping announced $60 billion in funding support for infrastructure development in Africa.

The Forum on China-Africa Cooperation included an eye-popping announcement of billions of dollars more in Chinese financing to build infrastructure across the continent. But these massive loans can come with steep and opaque conditions.

It’s tempting for Americans to think this is not our problem. But as African countries sink deeper and deeper into Beijing’s carefully laid debt trap, the United States could pay a steep cost in reduced cooperation on counterterrorism and job creation.

Chinese debt has become the methamphetamines of infrastructure finance: highly addictive, readily available, and with long-term negative effects that far outweigh any temporary high. This is particularly true in sub-Saharan Africa, where China has become the largest provider of bilateral loans. Forty percent of sub-Saharan African countries are already at high risk of debt distress; by having so much debt concentrated in the hands of a single lender, they are dangerously beholden to their supplier.

Why does this matter? Because in Africa and elsewhere, governments have secured massive loans from Beijing using strategic assets—such as oil, minerals, and land rights— as collateral. If borrower nations find themselves unable to repay the loan, China can claim the strategic asset. Sri Lanka recently learned this the hard way and handed over control of the port of Hambantota, giving China a strategic foothold along a busy trade waterway.

According to Professor Brahma Chellaney at the New Delhi-based Center for Policy Research, “several other countries, from Argentina to Namibia to Laos, have been ensnared in a Chinese debt trap, forcing them to confront agonizing choices in order to stave off default.”

While Chinese debt diplomacy may not seem relevant to most Americans, it is a serious threat to US national security. Most directly, China’s crafty negotiations and seizure of strategic assets can limit US influence and access overseas.

For instance, the tiny country of Djibouti is home to the most significant American military base in Africa. Thanks to Chinese loans, Djibouti’s debt-to-GDP ratio surged from 50 to 85 percent between 2014 and 2016. If Djibouti were to default and relinquish the port that resupplies the US base, American military capability in Africa and the Middle East could be seriously threatened.

More broadly, unsustainable levels of debt can destabilize African states, which also compromises American security interests. Over-leveraged governments can get caught in a downward spiral of credit downgrades, reckless economic policies, and reduced spending on social services. With economic stagnation comes fewer opportunities for Africa’s fast-growing and young population. And the toxic brew of economic hopelessness and political disillusionment can drive disaffected youth toward violent extremism. That can threaten Americans abroad and, potentially, even at home.

Finally, China’s debt diplomacy shuts out opportunities for US businesses. Not only do Beijing’s cheap infrastructure loans come with conditions to employ Chinese companies, they also set out technical specifications for projects like high-speed railways and wireless networks in a manner that favours Chinese firms. The combined effect of these efforts “would push the United States away from its current position in the global economy and move China toward the centre,” according to Jonathan Hillman, a fellow at the Center for International and Strategic Studies. China already earns $180 billion annually from its investments in Africa; if its debt diplomacy remains uncontested, it’s likely that even more revenues and jobs will flow to China, instead of the US.

But this outcome is far from inevitable. The US has plenty of good options, but it needs to dramatically step up its game and support alternatives to Beijing’s aggressive finance initiatives. Perhaps most fundamentally, the US needs to focus on boosting African economic growth. Helping African states to strengthen investment climates and economic governance will help them attract more private sector capital and provide more entry points for US companies. A key component is assisting African efforts to increase transparency, so that all the costs and benefits of project finance options are openly known. Fully staffing US embassies and offering more technical assistance to evaluate loan agreements and investment contracts would be a good start.

To date, the Trump Administration’s Africa policy has been adrift, defined more by racial epithets than any cohesive strategy or results. By comparison, China has a clear vision that will yield long-term benefits.

In Africa and around the world, much more needs to be done to confront Chinese debt diplomacy. If not, the US will pay a heavy price in its commercial and national security interests.

Harris is CEO of Harris Africa Partners LLC and advises companies on investing in Africa. He was senior director for Africa at the White House from 2011-2015.

https://www.businesspost.ng/2018/09/04/chinas-billion-dollar-loans-to-africa-why-us-should-be-worried/

I like this. USA cannot remain at the center forever. They have ruled and ruined for too long. Roman power, German invasion, and British Colonial Administration etc they reigned and left for others. USA should prepare for China to Mount the center stage

If borrower nations find themselves unable to repay the loan, China can claim the strategic asset. Sri Lanka recently learned this the hard way and handed over control of the port of Hambantota, giving China a strategic foothold along a busy trade waterway.

This why am a bit worried with people that the president took to the meeting, most of them are after their pockets and what they will eat today they don't care about the state or citizens.
I was expecting him to take along with him business men, this kind of meeting is where Osinbajo also needs to attend has a legal person that can read in between the lines because anything chinese e get as e dey be ooo.

Who do no do am well, Sam Sam...
Apart from Masturbating, what else can he do with his hands

Everything comes with a price. There is always a hidden charge

Good both of them should court us and outbid themselves in incentives

DaniDani:
I like this. USA cannot remain at the center forever. They have ruled and ruined for too long. Roman power, German invasion, and British Colonial Administration etc they reigned and left for others. USA should prepare for China to Mount the center stage

Always remember that your country is the grass where this two elephants fight.

God bless China for their benevolence.

Africa and their leaders who with open eyes are walking into second colonialism should be more worried but they do not have any head talkless of thinking brain.

DaniDani:
I like this. USA cannot remain at the center forever. They have ruled and ruined for too long. Roman power, German invasion, and British Colonial Administration etc they reigned and left for others. USA should prepare for China to Mount the center stage

Na story u de yarn

DaniDani:
I like this. USA cannot remain at the center forever. They have ruled and ruined for too long. Roman power, German invasion, and British Colonial Administration etc they reigned and left for others. USA should prepare for China to Mount the center stage

Average Muslim thinking, yet they want to go to america instead of Saudi

Hypocritical fulls

Loans that won't be spent judiciously.

Dead weight loan

One in debt is indebted to poverty. Out of debt is out of poverty.

The USA has nothing to fear. They will always have a way around things.

African nations still remain at a loss.

dipoolowoo:
By Grant T. Harris

This week, China hosted leaders from across Africa for a summit in Beijing. The last summit was held in December 2015 in Johannesburg, South Africa, where Chinese President Xi Jinping announced $60 billion in funding support for infrastructure development in Africa.

The Forum on China-Africa Cooperation included an eye-popping announcement of billions of dollars more in Chinese financing to build infrastructure across the continent. But these massive loans can come with steep and opaque conditions.

It’s tempting for Americans to think this is not our problem. But as African countries sink deeper and deeper into Beijing’s carefully laid debt trap, the United States could pay a steep cost in reduced cooperation on counterterrorism and job creation.

Chinese debt has become the methamphetamines of infrastructure finance: highly addictive, readily available, and with long-term negative effects that far outweigh any temporary high. This is particularly true in sub-Saharan Africa, where China has become the largest provider of bilateral loans. Forty percent of sub-Saharan African countries are already at high risk of debt distress; by having so much debt concentrated in the hands of a single lender, they are dangerously beholden to their supplier.

Why does this matter? Because in Africa and elsewhere, governments have secured massive loans from Beijing using strategic assets—such as oil, minerals, and land rights— as collateral. If borrower nations find themselves unable to repay the loan, China can claim the strategic asset. Sri Lanka recently learned this the hard way and handed over control of the port of Hambantota, giving China a strategic foothold along a busy trade waterway.

According to Professor Brahma Chellaney at the New Delhi-based Center for Policy Research, “several other countries, from Argentina to Namibia to Laos, have been ensnared in a Chinese debt trap, forcing them to confront agonizing choices in order to stave off default.”

While Chinese debt diplomacy may not seem relevant to most Americans, it is a serious threat to US national security. Most directly, China’s crafty negotiations and seizure of strategic assets can limit US influence and access overseas.

For instance, the tiny country of Djibouti is home to the most significant American military base in Africa. Thanks to Chinese loans, Djibouti’s debt-to-GDP ratio surged from 50 to 85 percent between 2014 and 2016. If Djibouti were to default and relinquish the port that resupplies the US base, American military capability in Africa and the Middle East could be seriously threatened.

More broadly, unsustainable levels of debt can destabilize African states, which also compromises American security interests. Over-leveraged governments can get caught in a downward spiral of credit downgrades, reckless economic policies, and reduced spending on social services. With economic stagnation comes fewer opportunities for Africa’s fast-growing and young population. And the toxic brew of economic hopelessness and political disillusionment can drive disaffected youth toward violent extremism. That can threaten Americans abroad and, potentially, even at home.

Finally, China’s debt diplomacy shuts out opportunities for US businesses. Not only do Beijing’s cheap infrastructure loans come with conditions to employ Chinese companies, they also set out technical specifications for projects like high-speed railways and wireless networks in a manner that favours Chinese firms. The combined effect of these efforts “would push the United States away from its current position in the global economy and move China toward the centre,” according to Jonathan Hillman, a fellow at the Center for International and Strategic Studies. China already earns $180 billion annually from its investments in Africa; if its debt diplomacy remains uncontested, it’s likely that even more revenues and jobs will flow to China, instead of the US.

But this outcome is far from inevitable. The US has plenty of good options, but it needs to dramatically step up its game and support alternatives to Beijing’s aggressive finance initiatives. Perhaps most fundamentally, the US needs to focus on boosting African economic growth. Helping African states to strengthen investment climates and economic governance will help them attract more private sector capital and provide more entry points for US companies. A key component is assisting African efforts to increase transparency, so that all the costs and benefits of project finance options are openly known. Fully staffing US embassies and offering more technical assistance to evaluate loan agreements and investment contracts would be a good start.

To date, the Trump Administration’s Africa policy has been adrift, defined more by racial epithets than any cohesive strategy or results. By comparison, China has a clear vision that will yield long-term benefits.

In Africa and around the world, much more needs to be done to confront Chinese debt diplomacy. If not, the US will pay a heavy price in its commercial and national security interests.

Harris is CEO of Harris Africa Partners LLC and advises companies on investing in Africa. He was senior director for Africa at the White House from 2011-2015.

https://www.businesspost.ng/2018/09/04/chinas-billion-dollar-loans-to-africa-why-us-should-be-worried/

I see a scenario where the wealth of America would contract- and a possibility that if a recession should happen again in america- there would be no country that would absorb the effects - and this would definitely lead to the collapse of the American economy - no matter the amount of economist they have they would be done for- what a shame- ottoman empire fell- great Egyptian empire collapsed - and trump moved America to the point of where it would soon collapse- where as he has investments outside america- *he wants to become richer then america*

Thank you China for your support, we love you.

US own is always counter terrorism, poverty breeds terrorism, if people are rich they wont want to become suicide bombers.
China is helping Africa to build infrastructure, schools and healthcare while America gives 'aid' in form of military hardware.
Show me a road built with US aid in Nigeria.

how is this good news for my country?

dipoolowoo:
By Grant T. Harris

This week, China hosted leaders from across Africa for a summit in Beijing. The last summit was held in December 2015 in Johannesburg, South Africa, where Chinese President Xi Jinping announced $60 billion in funding support for infrastructure development in Africa.

The Forum on China-Africa Cooperation included an eye-popping announcement of billions of dollars more in Chinese financing to build infrastructure across the continent. But these massive loans can come with steep and opaque conditions.

It’s tempting for Americans to think this is not our problem. But as African countries sink deeper and deeper into Beijing’s carefully laid debt trap, the United States could pay a steep cost in reduced cooperation on counterterrorism and job creation.

Chinese debt has become the methamphetamines of infrastructure finance: highly addictive, readily available, and with long-term negative effects that far outweigh any temporary high. This is particularly true in sub-Saharan Africa, where China has become the largest provider of bilateral loans. Forty percent of sub-Saharan African countries are already at high risk of debt distress; by having so much debt concentrated in the hands of a single lender, they are dangerously beholden to their supplier.

Why does this matter? Because in Africa and elsewhere, governments have secured massive loans from Beijing using strategic assets—such as oil, minerals, and land rights— as collateral. If borrower nations find themselves unable to repay the loan, China can claim the strategic asset. Sri Lanka recently learned this the hard way and handed over control of the port of Hambantota, giving China a strategic foothold along a busy trade waterway.

According to Professor Brahma Chellaney at the New Delhi-based Center for Policy Research, “several other countries, from Argentina to Namibia to Laos, have been ensnared in a Chinese debt trap, forcing them to confront agonizing choices in order to stave off default.”

While Chinese debt diplomacy may not seem relevant to most Americans, it is a serious threat to US national security. Most directly, China’s crafty negotiations and seizure of strategic assets can limit US influence and access overseas.

For instance, the tiny country of Djibouti is home to the most significant American military base in Africa. Thanks to Chinese loans, Djibouti’s debt-to-GDP ratio surged from 50 to 85 percent between 2014 and 2016. If Djibouti were to default and relinquish the port that resupplies the US base, American military capability in Africa and the Middle East could be seriously threatened.

More broadly, unsustainable levels of debt can destabilize African states, which also compromises American security interests. Over-leveraged governments can get caught in a downward spiral of credit downgrades, reckless economic policies, and reduced spending on social services. With economic stagnation comes fewer opportunities for Africa’s fast-growing and young population. And the toxic brew of economic hopelessness and political disillusionment can drive disaffected youth toward violent extremism. That can threaten Americans abroad and, potentially, even at home.

Finally, China’s debt diplomacy shuts out opportunities for US businesses. Not only do Beijing’s cheap infrastructure loans come with conditions to employ Chinese companies, they also set out technical specifications for projects like high-speed railways and wireless networks in a manner that favours Chinese firms. The combined effect of these efforts “would push the United States away from its current position in the global economy and move China toward the centre,” according to Jonathan Hillman, a fellow at the Center for International and Strategic Studies. China already earns $180 billion annually from its investments in Africa; if its debt diplomacy remains uncontested, it’s likely that even more revenues and jobs will flow to China, instead of the US.

But this outcome is far from inevitable. The US has plenty of good options, but it needs to dramatically step up its game and support alternatives to Beijing’s aggressive finance initiatives. Perhaps most fundamentally, the US needs to focus on boosting African economic growth. Helping African states to strengthen investment climates and economic governance will help them attract more private sector capital and provide more entry points for US companies. A key component is assisting African efforts to increase transparency, so that all the costs and benefits of project finance options are openly known. Fully staffing US embassies and offering more technical assistance to evaluate loan agreements and investment contracts would be a good start.

To date, the Trump Administration’s Africa policy has been adrift, defined more by racial epithets than any cohesive strategy or results. By comparison, China has a clear vision that will yield long-term benefits.

In Africa and around the world, much more needs to be done to confront Chinese debt diplomacy. If not, the US will pay a heavy price in its commercial and national security interests.

Harris is CEO of Harris Africa Partners LLC and advises companies on investing in Africa. He was senior director for Africa at the White House from 2011-2015.

https://www.businesspost.ng/2018/09/04/chinas-billion-dollar-loans-to-africa-why-us-should-be-worried/

Loan is in dollar not jpy
Why would usa be worried?
No place like usa

dipoolowoo:
By Grant T. Harris

This week, China hosted leaders from across Africa for a summit in Beijing. The last summit was held in December 2015 in Johannesburg, South Africa, where Chinese President Xi Jinping announced $60 billion in funding support for infrastructure development in Africa.

The Forum on China-Africa Cooperation included an eye-popping announcement of billions of dollars more in Chinese financing to build infrastructure across the continent. But these massive loans can come with steep and opaque conditions.

It’s tempting for Americans to think this is not our problem. But as African countries sink deeper and deeper into Beijing’s carefully laid debt trap, the United States could pay a steep cost in reduced cooperation on counterterrorism and job creation.

Chinese debt has become the methamphetamines of infrastructure finance: highly addictive, readily available, and with long-term negative effects that far outweigh any temporary high. This is particularly true in sub-Saharan Africa, where China has become the largest provider of bilateral loans. Forty percent of sub-Saharan African countries are already at high risk of debt distress; by having so much debt concentrated in the hands of a single lender, they are dangerously beholden to their supplier.

Why does this matter? Because in Africa and elsewhere, governments have secured massive loans from Beijing using strategic assets—such as oil, minerals, and land rights— as collateral. If borrower nations find themselves unable to repay the loan, China can claim the strategic asset. Sri Lanka recently learned this the hard way and handed over control of the port of Hambantota, giving China a strategic foothold along a busy trade waterway.

According to Professor Brahma Chellaney at the New Delhi-based Center for Policy Research, “several other countries, from Argentina to Namibia to Laos, have been ensnared in a Chinese debt trap, forcing them to confront agonizing choices in order to stave off default.”

While Chinese debt diplomacy may not seem relevant to most Americans, it is a serious threat to US national security. Most directly, China’s crafty negotiations and seizure of strategic assets can limit US influence and access overseas.

For instance, the tiny country of Djibouti is home to the most significant American military base in Africa. Thanks to Chinese loans, Djibouti’s debt-to-GDP ratio surged from 50 to 85 percent between 2014 and 2016. If Djibouti were to default and relinquish the port that resupplies the US base, American military capability in Africa and the Middle East could be seriously threatened.

More broadly, unsustainable levels of debt can destabilize African states, which also compromises American security interests. Over-leveraged governments can get caught in a downward spiral of credit downgrades, reckless economic policies, and reduced spending on social services. With economic stagnation comes fewer opportunities for Africa’s fast-growing and young population. And the toxic brew of economic hopelessness and political disillusionment can drive disaffected youth toward violent extremism. That can threaten Americans abroad and, potentially, even at home.

Finally, China’s debt diplomacy shuts out opportunities for US businesses. Not only do Beijing’s cheap infrastructure loans come with conditions to employ Chinese companies, they also set out technical specifications for projects like high-speed railways and wireless networks in a manner that favours Chinese firms. The combined effect of these efforts “would push the United States away from its current position in the global economy and move China toward the centre,” according to Jonathan Hillman, a fellow at the Center for International and Strategic Studies. China already earns $180 billion annually from its investments in Africa; if its debt diplomacy remains uncontested, it’s likely that even more revenues and jobs will flow to China, instead of the US.

But this outcome is far from inevitable. The US has plenty of good options, but it needs to dramatically step up its game and support alternatives to Beijing’s aggressive finance initiatives. Perhaps most fundamentally, the US needs to focus on boosting African economic growth. Helping African states to strengthen investment climates and economic governance will help them attract more private sector capital and provide more entry points for US companies. A key component is assisting African efforts to increase transparency, so that all the costs and benefits of project finance options are openly known. Fully staffing US embassies and offering more technical assistance to evaluate loan agreements and investment contracts would be a good start.

To date, the Trump Administration’s Africa policy has been adrift, defined more by racial epithets than any cohesive strategy or results. By comparison, China has a clear vision that will yield long-term benefits.

In Africa and around the world, much more needs to be done to confront Chinese debt diplomacy. If not, the US will pay a heavy price in its commercial and national security interests.

Harris is CEO of Harris Africa Partners LLC and advises companies on investing in Africa. He was senior director for Africa at the White House from 2011-2015.

https://www.businesspost.ng/2018/09/04/chinas-billion-dollar-loans-to-africa-why-us-should-be-worried/

Why should US be worried

Who is spending the money

Economic imperialism if our "borrowers" do not use these funds wisely

Oh, I understand... this is a US-centric fear of Chinese dominance in trade with Africa.

They didn't complain when they were making all those loans in the 70's and 80's via IMF and World Bank that crippled most African economies until 2000's. They didn't complain when the money was used to buy their own products, with interested paid on top. Now that their lunch is being threatened, they're pointing out the dangers of loans...

Chinese entrepreneurs are investing heavily in Africa, hiring labour and building infrastructure. They are also a cheaper source of goods and machinery that African entrepreneurs are buying and using to boost our economy.

Around the world the USA is retreating - insulting friends and allies all the way - and China is quietly stepping in to fill those shoes, making deals with Europe, with Japan, with the rest of Asia, and with Africa. No dogma or imposing their views, just doing business.

How about why Africa and Africans should also be worried

Adebowhales:
Who do no do am well, Sam Sam...
Apart from Masturbating, what else can he do with his hands

Grill some Dead Animal, we call that Ise-Owo, Hand work

DaniDani:
I like this. USA cannot remain at the center forever. They have ruled and ruined for too long. Roman power, German invasion, and British Colonial Administration etc they reigned and left for others. USA should prepare for China to Mount the center stage

Be careful what you wish for.
There's no such thing as free lunch.

They will collect this loan, at the end Buhari himself will divert it. #Shithole country

Us have nothing to worry about

And to foolish African leaders, will they make judicious use the loan

A borrower is a slave to the lender, you know.

Wow