That makes sense if countries are starting to divest from the US bond market…there’s not really a peer replacement right now. But it has to happen.
Yelesa on
Submission Statement: Chinese lending to Africa has dropped sharply from its peak in the mid-2010s, as Chinese banks have become more cautious and many African countries face debt and budget pressures. In 2024, China’s total lending to the continent fell to $2.1 billion, more than 90% below its 2016 high, and has averaged just over $2 billion a year since 2020, compared with more than $10 billion between 2012 and 2018. The decline began in 2019 during the COVID-19 period, when economic shocks and unpaid loans made lenders more risk-averse and less willing to fund large infrastructure projects. Most 2024 lending went to Angola, mainly for energy and transport, although energy financing has remained largely flat. China is also shifting from dollar-based loans to loans in yuan, which may reduce currency risks but could create problems for countries without enough yuan reserves. As China pulls back, other lenders such as Gulf states, development banks, and possibly the US may play a larger role, even as China’s trade surplus with Africa reached a record $102 billion last year.
Ooofy_Doofy_ on
But what about soft power? What will the third world think of us? First US, now China?
Leave A Reply
Du musst angemeldet sein, um einen Kommentar abzugeben.
3 Kommentare
That makes sense if countries are starting to divest from the US bond market…there’s not really a peer replacement right now. But it has to happen.
Submission Statement: Chinese lending to Africa has dropped sharply from its peak in the mid-2010s, as Chinese banks have become more cautious and many African countries face debt and budget pressures. In 2024, China’s total lending to the continent fell to $2.1 billion, more than 90% below its 2016 high, and has averaged just over $2 billion a year since 2020, compared with more than $10 billion between 2012 and 2018. The decline began in 2019 during the COVID-19 period, when economic shocks and unpaid loans made lenders more risk-averse and less willing to fund large infrastructure projects. Most 2024 lending went to Angola, mainly for energy and transport, although energy financing has remained largely flat. China is also shifting from dollar-based loans to loans in yuan, which may reduce currency risks but could create problems for countries without enough yuan reserves. As China pulls back, other lenders such as Gulf states, development banks, and possibly the US may play a larger role, even as China’s trade surplus with Africa reached a record $102 billion last year.
But what about soft power? What will the third world think of us? First US, now China?