China is opting for debts in order to get the control of the important ports and gain the access to African oil in Kenya, Angola and Djibouti. The Chinese government is offering lucrative infrastructure projects to the countries which are in dire need and are asking for their influence in return. The approach taken by China would further spread across the globe after the trillion dollar Belt and Road Initiative adopted by China.
The two countries had developed their diplomatic ties in 1983. China had provided Angola with an amount of $ 60 billion through various projects, loans and investments. Angola would be paying the Chinese with oil. Angola’s capacity to pay China back the loan entirely depends on the price of oil. Angola would also not be able to sell a lot of oil to the other trading partners of the nation.
China owns 55% of Kenya’s foreign debt and Kenya had recently joined the Asian Infrastructure Investment Bank which is China’s answer to the World Bank. China’s development as a preferred lender had rivaled the position of the World Bank but the people of Kenya are aware about the influence of China.
China has developed a full-fledged military base in Djibouti after establishing strong relationships with numerous African nations. The Chinese military had fired lasers at the US air crafts from the base they had established which had been a major issue of concern. It is expected that the influence of Beijing on Djibouti might expand and the Chinese merchants could use Djibouti to grab the lucrative East African markets.
China had also developed a railway line from the port to Addis Ababa in order to transport the Ethiopian goods. Djibouti’s foreign minister had stated that the debt to China was manageable.