The report shows that China is backing big African infrastructure projects less, as many countries on the continent are debt-laden. 

China loaned $994.48 million to African governments in 2022, the lowest since 2004. This is according to a report released on September 19 by the Global Development Policy Center, a think tank affiliated with Boston University (USA).

Titled "A New State of Lending: Chinese Loans to Africa," the report is an update of the database on Chinese loans to Africa (CLA), an interactive project managed by the Global Development Policy Center. Since 2000, this project has been tracking Chinese loans–from public and private banks, and public entities to governments, public companies, and regional multilateral institutions in Africa.

In 2022, Beijing granted nine loans to African countries, totaling $994.48 million, against seven loans amounting to $1.22 billion in 2021.

Besides the COVID-19 pandemic, the drop in lending results from China’s decision to move away from large infrastructure projects in Africa, where more and more countries are feeling the weight of debt. Two other reasons for the shift include China's refocus on national priorities, and its new approach regarding the "Belt and Road Initiative" which is based on smaller, higher-quality, environmentally-friendly projects (Green, small, and beautiful).

The report notes that China should keep opting for smaller projects, with fewer loans exceeding $500 million, and more loans valued below $50 million directed towards projects with better social and environmental impacts.

West Africa led in 2021 and 2022

In 2021 and 2022, China Eximbank remained the primary lender in Africa, granting nine of the 16 loans recorded during this period, totaling $1.42 billion.

The China Development Bank (CDB) did not grant any loans in 2021 but approved a small loan of $14.74 million in 2022. Other major lenders include the Bank of China (BOC), the China National Aero-Technology Import and Export Corporation (CATIC), and the China Shipbuilding Trading Company (CSTC).

Senegal, Benin, Ivory Coast, Angola, Uganda, Ghana, Rwanda, and the Democratic Republic of Congo (DRC) were the main borrowers in 2021 and 2022. This borrower composition is different from previous years, as West African countries like Senegal, Benin, and Ivory Coast took on significant debt for the first time.

The sector distribution of loans granted by China to African countries over the last two years also shows major shifts compared to previous years. Capturing 45% of the total, the transport sector surpassed the energy sector which secured no loan. After transport came the environment (21%), information and communication technology (12%), education (10%), and defense (6%) sectors.

Since 2000:

The report also reveals that between 2000 and 2022, 39 Chinese lenders provided 1,243 loans totaling $170.08 billion to 49 African governments, dozens of public companies, and seven regional multilateral institutions.

Chinese loans to Africa in 2000-2022 account for 64% of the total funding the continent secured from the World Bank in the same period ($264.15 billion), and nearly five times what it obtained from the African Development Bank ($36.85 billion).