EU Seeks to Reduce Africa’s China Dependency With Funding Plan

The European Union is selling its €150 billion investment plan for Africa as a way to help reduce the continent’s reliance on Chinese loans that have saddled countries with debt, a senior official said. 

Jutta Urpilainen, the bloc’s commissioner for international partnerships, said the EU has a powerful marketings message for Global Gateway program, which aims to compete with the China’s Belt and Road Initiative, which as generated more than $120 billion of government-backed loans to African nations. 

The Chinese funding, however, came with accusations of debt traps, exploitation and corruption — charges that were bolstered when a wave of debt distress swept Africa in recent years and three countries defaulted.

“What I see as an impact of Chinese activities in Africa is a huge dependency on China, so that if you look at the many African countries, their debt levels are very high, a huge amount of their revenues actually go to debt servicing,” Urpilainen said in an interview in the Ethiopian capital, Addis Ababa. “In contrast, our goal is to support Africa in standing on its own feet.”

Under the Global Gateway program, the EU is investing in transport, energy and digital projects, as well as education and health, she said. 

But the program is still in an early stage compared to the decade-old Belt and Road Initiative. It also relies on a more complex structure that relies on leveraging resources from EU member states and multilateral organizations. 

Urpilainen was in Addis Ababa, which serves as the headquarters for the African Union, for meetings with officials from the continental body, including AU Commission Chairman Faki Mahamat 

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