Tillerson: China’s ‘Predatory Loan Practices and Corrupt Deals’ Threaten Africa

US Secretary of State Rex Tillerson will meet with leaders in several African countries in March, plus African Union leadership in Addis Ababa
AFP/ADEM ALTAN

Secretary of State Rex Tillerson warned African states to be wary of incurring too much debt from creditor China, which seeks to “encourage dependency” to undermine their sovereignty, in a speech Monday before heading on his first trip as America’s top diplomat to the country.

Speaking to an audience at George Mason University, Tillerson also urged African governments to cut ties with North Korea, lamenting that these states could “do more” to diminish the threat of the nuclear-armed rogue state prompting a major war.

Trump administration officials have repeatedly emphasized the pivotal role that China plays in emboldening North Korea as its largest trading partner. In past remarks, Tillerson has stated that North Korea is not only a moral burden to China, but represents a “serious threat” to the country.

Tillerson revealed a series of new intiatives to enhance economic and humanitarian cooperation between the United States and Africa on Monday. “The United States pursues, develops sustainable growth that bolsters institutions, strengthens rule of law, and builds the capacity of African countries to stand on their own two feet,” he affirmed. “We partner with African countries by incentivizing good governance to meet long term security and development goals.”

This he contrasted with the Chinese Communist Party, which, he said, “encourages dependency using opaque contracts, predatory loan practices, and corrupt deals that mire nations in debt and undercut their sovereignty, denying them their long-term, self-sustaining growth.”

“Chinese investment does have the potential to address Africa’s infrastructure gap, but its approach has led to mounting debt and few, if any, jobs in most countries,” he warned. “When coupled with the political and fiscal pressure, this endangers Africa’s natural resources and its long-term economic political stability.”

Tillerson urged China to join the United States in helping promote “responsible development and transparent free market practices that foster greater political stability on the continent.”

On North Korea, Tillerson stated that African states must “take an active role” to combat global problems, not just solve local ones.

“North Korea threatens the entire global community through its unlawful nuclear and ballistic missile programs and proliferation activities, including its arms exports to Africa,” he argued. “It doesn’t just involve our allies in Europe or Asia. It doesn’t just include countries with longstanding ties to the DPRK, like China and Russia. This is and must be a global effort.”

African states, he added, “need to do more.”

This is not the first time that Tillerson makes a similar warning. The Secretary of State has repeatedly warned developing nations both within and outside Africa that China’s generous credit deals could make them beholden to the demands of the totalitarian government in Beijing. In October, he referred to China’s “predatory” lending practices as “irresponsible”

“We have watched the activities and actions of others in the region, particularly China, and the financing mechanisms it brings to many of these countries, which result in saddling them with enormous levels of debt,” he said at the time.

The Trump administration’s National Security Strategy, released in January, also accuses China of “predatory economics to intimidate its neighbors while militarizing features in the South China Sea.”

On Monday, before Tillerson made his remarks, the State Department’s Acting Assistant Secretary for African Affairs Don Yamamoto told reporters that the United States and the global community “need to have that discussion with China” on what “their overall goals and operations are on the continent,” both in terms of promoting exorbitantly priced infrastructure projects and boosting its military presence there.

“Those of us who worked on the HIPC, the [Heavily Indebted Poor Countries], we took a lot of African countries off of debt in order to give them an opportunity for economic development, and so we would not want to see these countries get re-indebted again,” he explained. “And we’re seeing countries at 50 percent, 100 percent, and in one case 200 percent of GDP debt based on concessionary loans from China, but also other countries as well, and other institutions. And that’s going to other countries.”

The Communist Party in Beijing responded to these concerns in depth during the state’s Foreign Ministry briefing on Wednesday.

“China welcomes the diversification of Africa’s international partnerships and sincerely hopes that various parties of the international community can increase inputs in Africa. In particular, the developed countries should earnestly deliver on their commitment,” spokesman Geng Shuang told reporters. “Relevant countries should develop relations with Africa with a view to supporting Africa’s peace and development and making positive contributions to its prosperity and revitalization, instead of making irresponsible remarks on African countries’ efforts to pursue their own development and their ongoing cooperation with other countries.”

“African countries and people know the best and are in the best position to say whether the China-Africa cooperation is good or not,” he concluded.

Tillerson will travel to Chad, Djibouti, Kenya, Ethiopia, and Nigeria beginning on March 6.

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