China’s lending to Africa fell sharply to $2.1 billion in 2024, nearly half the previous year’s level and a fraction of its $28.8 billion peak in 2016, signaling a clear shift in Beijing’s strategy. New data from Boston University show China moving away from debt-heavy megaprojects toward smaller, commercially viable investments that carry lower risk. A key feature of this new phase is the strong push to use China’s currency, the yuan, for loans and financing cooperation. The pivot follows pandemic-era loan losses and defaults in countries such as Zambia and Ghana. This strategic shift towards selective, market-based tools aims to mitigate debt risks while deepening economic ties, marking the start of a more calculated chapter in Sino-African relations.
Business Day
