Africa’s debt to China is complicated

Doing deals: China’s President Xi Jinping and President Cyril Ramaphosa met at the Forum on China-Africa Co-operation earlier this month. (Lintao Zhang/AFP)

President Cyril Ramaphosa assured South Africans this week that the government was not in the habit of “handing over the assets of our country to other nations [or] to other entities outside of our country”.

The state “has not sold the soul of South Africa to the highest bidder”, he promised, in reply to a question in the National Council of Provinces about the details of a R33-billion loan from the China Development Bank (CDB) to embattled power utility Eskom.

Ramaphosa’s reply is of particular significance following a report by Africa Confidential last week that Zambia’s state electricity company, Zesco, is in talks about a takeover by a Chinese company. This has fuelled the debate about China’s supposed “debt-trap diplomacy” — that it is angling to take over the strategic assets of nations that fail to repay their debts, thereby increasing its geopolitical influence.

Questions have also been raised on social media about whether a Chinese-developed special economic zone (SEZ) in Limpopo, which has been in the works since 2014, is a sign of South Africa surrendering its sovereignty to China.