Malawi government’s recent announcement of a new infrastructure financing deal with China to the tune of K855 billion- an amount closest to Malawi’s 2015-16 national budget is, perhaps, the greatest news to have come from government in 2015.
Or, not so?
But then, the wisdom in this Chewa proverb that “You don’t prepare mice in another person’s hut” is also there to give us some caution.
It is wise to beg and not to reject gifts but never let that pass the elbow for “If you call for a wild cat it simply means you have chickens”.
China is not the wild cat of course. It is a benevolent all-weather friend that Malawi must thank, especially in this bad time when it is not able to fund its infrastructure development from its own resources.
China always comes in time, and with love.
China only requires you to show your business plan.
Look! Kenya and Zambia – though Zambia is now struggling with its kwacha –are economically doing much better than Malawi.
But does China give more to Malawi than Zambia or Kenya just because it is poorer? No, it doesn’t.
So the soft loans and grants Malawi is fanatically enthusiastic about, could be just peanuts of what Kenya, Zambia and many other African countries get from China.
Not that China cannot give Malawi large amounts. But Malawi should help itself first. It is like you don’t force a person with a very small head to carry a big sagging basket, for his eyes will not see the road before him and he will fall.
China knows very well that its bounty soft loans might not be so soft to Malawi now.
It is important to know that the relation between China and Africa has grown remarkably in recent years. Almost everywhere on the continent, the Chinese footprints are unmistakable especially in the construction and infrastructure sectors.
Starting from the building of the seat of Africa- the African Union Headquarters in Addis Ababa, Ethiopia –China hit the nail on the head and better claimed its place in Africa.
Most of the major infrastructure projects on African soil now, from construction of roads, railways, stadiums, energy supply plants to telecommunications, China can’t be missed.
In trade, China is currently Africa’s biggest trading partner, with an estimated annual trade volume of $200 billion, leaving the United States and Europe in a distant second and third respectively.
And they have even gone beyond a mere presence of only Chinese flying from China. Have you not seen, some of our women carrying babies with unprecedented features of a Chinese? The Chinese are generous also in this, siring a new African breed, for they have come not to go back home so soon.
Some have described the Chinese’ growing presence in Africa as a new ‘Scramble for Africa’ or a natural resources grab.
But that is not our interest now. What Africa desperately needs is the infrastructure to support its ‘African Rising’ narrative.
Now let us go back, to our point. You think in Africa the Chinese are only generous with the pathetic states? Not at all.
In East Africa, China is financing the building of the East African Standard Gauge Railway, which will link the Kenyan cities of Mombasa and Nairobi and will eventually extend to Kampala in Uganda, Juba in South Sudan and Kigali in Rwanda.
The rail system is part of an integrated development plan for East Africa that will include expanded airports, highways and port facilities along the coast.
And here you have Kenya, a country which is pushing into the rung of a middle-income status and currently one of the best performing economies in Africa. And China has not denied Kenya the soft loans on grounds of its healthier economy.
The Export-Import Bank of China (China Exim Bank) is financing the massive infrastructural projects to have ever happened in the country.
Or maybe we have gone very far. We can check with our neighbour, Zambia and learn what the Chinese have already done there.
In population, there are now between 20, 000 and 100, 000 Chinese nationals in Zambia according to some estimates based on the country’s census data.
In Zambia, the Chinese started in 1970, when they started building the 1,860-kilometre Tazara railway that links Tanzania’s largest city of Dar es Salaam with Kapiri Mposhi in Zambia’s Central Province.
The railway was financed by China to the cost of roughly $500 million. That was during the time Malawi had diplomatic ties with Taipei and had not yet recognised Beijing.
Today football fans watch Chipolopolo – the Zambia national football team –in the Chinese built Levy Mwanawasa Stadium in Ndola as Malawi football fans will be doing with the Flames soon in Bingu Stadium in Lilongwe.
The Chinese have also built the ultramodern National Heroes Stadium, a $14 million bridge across the vast Luapula River that connects Zambia with its neighbour, the Democratic Republic of Congo (DRC).
Another monumental project by the Chinese in Zambia is the construction of the country’s most expensive road at a cost of $200 million.
Bilateral trade between Zambia and China hit $3.81 billion in 2013. And according to the Chinese Embassy in Lusaka, over 500 Chinese companies operate in Zambia with a cumulative investment of $3 billion, resulting in 50,000 jobs to the locals.
China’s robust economic growth has been a blessing for Africa, especially in the last decades.
From 1989 to 2015, China had a GDP growth rate averaging 9.04 percent and it had its lowest growth rate in recent times, this year at about 7 percent.
From this growth Africa always smiled all the way to the Chinese banks for the soft loans.
It is estimated that between 2009 and 2012, China provided African countries with about $10 billion in concessional loans. It is also anticipated that by 2025, China will have provided African countries with about $1 trillion in financing including direct investment, soft and concessional loans.
But China’s economy is prone to meltdown, as economies have the habit of doing.
That could mean that the news will not be China financing a landmark project such as the 300 megawatt Kammwamba coal-fired energy plant in Balaka or the Blantyre District Hospital and the Cancer Centre in Blantyre to the tune of $23 million.
The news could be China financing the construction of a bridge on Nasolo River in Ndirande Township or constructing toilets in schools at Thekerani in Thyolo.
These will not be soft loans or grants; they will be short-term hard loans with punitive interest rates.
So, yes, it is good news that China is here.
But for the future, we can’t tell. That is why Malawi should start helping herself first.
Other countries have already started.
Ethiopian Prime Minister, Hailemariam Desalegn said this a few days before United States President Barrack Obama visit to his country:
“The construction boom you see in the capital is largely driven by the success of the agriculture sector. The farmers having produced surplus now have savings, and these savings have enabled banks to finance these projects….So that’s why at the recent (Financing for Development conference in Addis) we raised the point of domestic resource mobilisation”.
So it means that we go back to that Chewa proverb: “You don’t prepare mice in another person’s hut”.
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