Angola receives a quarter of Chinese loans granted to Africa

The landscape of the Mavinga conservation area in Cuando-Cubango, Angola

Angola has received a quarter of all the loans China has granted to African countries in the last 15 years and Angolan state oil company Sonangol has received 84 percent of all the loans granted to the extractive industries, according to a new academic database.
The first conclusions of the China Africa Research Initiative (CARI), of US John Hopkins University, were presented in June, following nine years’ work by researchers Jyhjong Hwang, Deborah Brautigam and Janet Eom.
Of the USD86.9 billion in loans provided by China to Africa between 2000 and 2014 – by the government, banks and companies – Angola received $21.2 billion, or 23 percent of the total, followed by Ethiopia, Sudan, Kenya and the Democratic Republic of Congo.
The largest financier of Angola was the China Development Bank ($11.3 billion), followed by the Export Import Bank of China (ExIm – $7.36 billion) and an additional $2.5 billion provided by other institutions.
In the study researchers said that almost all Chinese loans to Angola were guaranteed with oil. Half of the financing has been provided for transport infrastructure and agriculture by the China ExIm Bank and the China Development Bank. The remaining loans are made up of commercial loans to Sonangol by the China Development Bank and the Industrial and Commercial Bank of China.
The study also showed that 84 percent of loans from China to the African extractive industry were granted to Sonangol.
In Africa the three sectors that received most funding were transport ($24.2 billion), energy ($17.6 billion) and the extractive industry ($9 billion).
Loans to the transport sector mainly involved construction and renewal of roads, railways, airports and ports, as well as buying transport vehicles.
At a time of economic slowdown for Angola, Chinese companies have become more active due to a credit line from China, which plans to finance 155 projects in Angola with $5.2 billion.
At the end of May the Angolan government authorised hiring Chinese companies to carry out 23 public works projects, to supply water and repair roads in eight provinces. The projects have an estimated cost of around $550 million and will be implemented in the provinces of Bengo, Bié, Huambo, Namibe, Kwanza Norte, Kwanza Sul, Malanje and Uíge.
Amongst the Portuguese-speaking countries the John Hopkins University database also noted Mozambique, which has received $1.86 billion from China, of which $1.66 billion from the ExIm Bank, and Equatorial Guinea, with $2.5 billion.
Cape Verde received $152 million and the CARI database had no loans recorded for Guinea-Bissau or Sao Tome and Principe.  MDT/Macauhub