Commentary
The Chinese Communist Party (CCP) is using U.S. support for Israel and Ukraine to justify its debt trap diplomacy, portraying China as the benevolent savior of the world.
The Wumao, the CCP’s online army, are in high gear, using U.S. support for Israel and Ukraine as a talking point in their propaganda war to degrade the United States and convince other countries that China is helping the world, while the United States is blowing it up. They are pushing the slogan “China builds, U.S. bombs,” which is being echoed across liberal media sites, CCP state media, and the South China Morning Post. As proof of the CCP’s so-called benevolence, they cite a recent Chinese investment to build a light rail project in Lagos, Nigeria.
A Wumao account posted on X, formerly Twitter, that “During the same period in which these two great nations, Nigeria and China, cooperated to build more human-quality of life-enhancing infrastructure, the US has been sending bombs to wars in Europe and West Asia.”
The first point this post misses is that the United States is the largest donor to Nigeria. Furthermore, the United States provides more foreign aid globally than any other country, and China isn’t even in the top 20. Additionally, the United States is the single largest donor to the United Nations.
Although the Lagos Metro Rail Transit Red Line Project is currently prominent in the news and the CCP propaganda sphere, the $2.5 billion agreement for its construction was signed in 2016. At that time, the CCP touted it as an act of Beijing’s largesse. In reality, Nigeria hasn’t benefited significantly because the project hasn’t been completed. The construction was carried out by China Civil Engineering Construction Corp., a state-owned company. Consequently, money borrowed by Nigeria was paid to a Chinese state company.
The financing was largely provided through African development banks, so it is unclear how the CCP is claiming that they have provided aid to Nigeria. However, China remains Nigeria’s primary lender, with Nigeria’s debt to China now standing at $5.16 billion. These loans were made by Chinese state-owned banks, principally the Export-Import Bank of China, which earned a profit.
In addition to this project, the president of Nigeria signed deals totaling $6 billion with China, under similar financing terms and conditions, involving other infrastructure projects. Essentially, these deals represent revenues that will flow to China while adding to Nigeria’s debt burden, which is already growing at a rate six times that of its GDP.
The African Development Bank has criticized “opaque” loans tied to natural resources, including Chinese loans, as being detrimental to Africa’s development. The exact terms of Chinese loans, such as those under the Belt and Road Initiative (also known as “One Belt, One Road”), are often withheld from the public. In Nigeria and many other countries, there has been public outrage over increasing debt to China and the potential loss of sovereignty.
Additionally, Chinese loans to poor countries tend to have an interest rate of 2 to 3 percent, while developmental loans from traditional lenders such as the Paris Club, IMF, World Bank, and countries such as the United States, Japan, and the European Union typically have an interest rate of zero.
In exchange for loans and investments, China often secures concessions on natural resources from countries such as Nigeria. Specific examples of these concessions include access to oil and other valuable resources, which are critical to China’s long-term economic strategy. Because of the financial burden of repayment, the debt incurred from Chinese loans can severely affect Nigeria’s economy, limiting its ability to invest in crucial areas like health care and education.
The Lagos Red Line light rail project’s inauguration ceremony was held in March 2023, marking the project’s first phase becoming operational. This phased approach is a common feature of CCP “aid” and investment. Often, these projects can’t generate significant economic benefits until they are fully completed and operational. However, to reach full completion, countries are frequently forced to borrow additional funds.
An example of this is the Kenya Standard Gauge Railway project. Originally intended to connect Mombasa with Nairobi and eventually extend to Uganda, the project currently stops at Naivasha, about 74 miles short of Lake Victoria. This incomplete connection significantly reduces the project’s economic contributions, which were expected to help repay the loans.
Beijing blaming Washington for supporting Israel and Ukraine is ironic because the Chinese regime is backing the other side, providing economic investment and trade to Iran, a state-backer of terrorist groups, including Hamas, the Houthis, and Hezbollah. Beijing also is supporting Russia economically and providing Russia with dual-use and possibly military technology and equipment to aid Moscow’s illegal invasion of a sovereign nation.
Beijing’s “aid” to other countries isn’t true aid but investment. It isn’t driven by largesse but by the goal of generating revenues for state-backed companies and banks. Chinese loans aren’t development loans, as they come with high interest rates, unlike the zero-rate loans offered by traditional Western lenders. Consequently, Chinese state-owned companies and banks benefit financially, while the CCP gains undeserved diplomatic clout.
Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.
