JUBA, South Sudan -- China's Belt and Road investment in sub-Saharan Africa fell to a new low last year, showing that increased U.S. and European spending could reduce the region's need to rely on Beijing for funding.
China's investment in the region related to Beijing's global infrastructure development strategy dropped 55% to $7.5 billion last year, according to a recent report from the Green Finance and Development Center at Fudan University in Shanghai.
China's Africa Belt and Road investment drops as West spends more. JUBA, South Sudan -- China's Belt and Road investment in sub-Saharan Africa fell to a new low last year, showing that increased U.S. and European spending could reduce the region's need to rely on Beijing for funding.
The ripple effects of China's slowing economy extend to sovereign lending to sub-Saharan Africa, which fell below $1 billion last year—the lowest level in nearly two decades. The cutback marks a shift away from big ticket infrastructure financing, as several African countries struggle with escalating public debt.
China guarantees a steady supply chain to satisfy the demands of its manufacturing and industrial sectors by gaining access to these essential resources. This resource-driven economic alliance is mutually beneficial, with Chinese investments boosting infrastructure and creating jobs in African countries.
In addition to resource-seeking motives, China also invests in Africa in order to create markets for their products and services; partly because of the increased competition Chinese companies are facing in their domestic market.
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