In 2023, Chinese lending to Africa experienced a notable rebound, reaching $4.61 billion, according to a study by Boston University’s Global Development Policy Centre. This marks the first annual increase in Chinese lending to Africa since 2016, signaling a shift in China’s approach to financing on the continent.
Although this figure is substantially lower than the peak lending years of 2012-2018—when China provided over $10 billion annually—the recent increase suggests that China is exploring a more sustainable lending strategy. The study noted that Beijing appears to be seeking a new equilibrium in its financial engagement with Africa.
A significant portion of the 2023 loans, totaling $2.59 billion, was directed towards regional and national financial institutions rather than individual governments. This shift reflects a strategy aimed at mitigating risk by avoiding direct exposure to the debt challenges faced by individual African countries.
Noteworthy loans in 2023 included a nearly $1 billion loan from the China Development Bank to Nigeria for railway development. Egypt’s central bank also received a similar amount. Despite a decline in lending since 2019, China remains a key player in African development, having provided a total of $182.28 billion between 2000 and 2023, primarily for energy, transport, and ICT projects.
The study also highlighted a growing emphasis on renewable energy, with approximately 10% of 2023 loans allocated to solar and hydropower projects. However, the overall direction of China’s financial strategy in Africa remains uncertain, as loans were also extended to countries with significant debt challenges, such as Nigeria and Angola.
The Global Development Policy Centre concluded that the future quality and sustainability of China’s partnerships in Africa will need to be observed as the new lending strategies unfold.
