{"id":17751,"date":"2023-05-22T07:11:10","date_gmt":"2023-05-22T07:11:10","guid":{"rendered":"https:\/\/www.africa-press.net\/sierra-leone\/all-news\/are-us-china-tensions-bad-for-africa"},"modified":"2023-05-22T07:29:08","modified_gmt":"2023-05-22T07:29:08","slug":"are-us-china-tensions-bad-for-africa","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/sierra-leone\/all-news\/are-us-china-tensions-bad-for-africa","title":{"rendered":"Are US-China tensions bad for Africa?"},"content":{"rendered":"<p><b>Harry Clynch<\/b><\/p>\n<p><span style=\"color: #ff6600\"><strong>Africa-Press &#8211; Sierra-Leone. <\/strong><\/span>A gloomy report from the IMF suggests that Africa could face \u201cpermanent decline\u201d if tensions between the West and China escalate, but some argue that the continent would still have the ability to shape its own role.<\/p>\n<p>At the start of May, the International Monetary Fund (IMF) issued a stark warning to sub-Saharan Africa. The region \u201ccould stand to lose the most if the world were split into two isolated trading blocs centred around China or the United States and the European Union,\u201d the IMF said.<\/p>\n<p>In the most severe scenario, in which capital flows between the two trade blocs were completely cut off, the IMF believes that sub-Saharan Africa \u201ccould experience a permanent decline of up to 4 percent of real gross domestic product after 10 years\u201d and see a permanent decline in economic growth.<\/p>\n<p>It is certainly true that Africa, like every continent, has seen economic turbulence in the aftermath of Russia\u2019s invasion of Ukraine, which has aggravated geopolitical tensions between East and West. Supply chains for grains and wheats have been disrupted, leading to higher inflation for essential goods.<\/p>\n<p>A more volatile world has encouraged investors to put their money in \u201csafe haven\u201d financial assets, such as the US dollar, making it more expensive for African governments to service their dollar-denominated debts.<\/p>\n<p>Further, the slowdown in business activity and global economic growth has reduced African governments\u2019 trade and taxation revenues. If the IMF\u2019s prediction is realised, these consequences would just be among the first felt by Africa as geoeconomic fragmentation deepens.<\/p>\n<p>Some experts, however, question the premise of the IMF\u2019s forecasts. Edward Knight, geopolitical researcher at the Tony Blair Institute for Global Change in London, tells African Business that \u201cthe US-China competition is not inherently bad for Africa, nor inherently good. I think it really depends on how different African governments engage with both the US and China.\u201d<\/p>\n<p>He cites the case of critical raw materials as an example. \u201cThe supply chains usually involve both the US and China. African countries export them to China, where the materials or minerals are processed, and they end up in American iPhones, for example. Disruption to that clearly can happen immediately and have a negative impact,\u201d he says.<\/p>\n<p>\u201cBut on the flip side, if the US wants to keep having access to processed minerals without China, that could end up leading to a bidding war, which would be good for African countries. They might even go one step further and start investing in domestic processing facilities and build their own kind of viability in that way.\u201d<\/p>\n<p><b>African agency matters<\/b><\/p>\n<p>Teniola Tayo, trade policy fellow at the Africa Policy Research Institute in Berlin, agrees that \u201cit really depends on to what extent African countries leverage the situation to their advantage instead of waiting to be victimised by the situation&#8230; African agency will determine the outcome.\u201d<\/p>\n<p>Indeed, while the IMF\u2019s predictions rest on the assumption that \u201cfragmentation and polarisation\u201d will hit African trade and economic growth, there is the possibility that African countries could benefit from playing China and the US off against each other.<\/p>\n<p>China has been very active in Africa diplomatically and economically, particularly since the launch of the Belt and Road Initiative in 2013. It surpassed the US as Africa\u2019s largest trading partner as early as 2009. The US is widely suspected to have neglected its relationships in Africa, but is now attempting to address this in a bid to tame China\u2019s influence.<\/p>\n<p>In December last year President Biden hosted a summit of African leaders at the White House. US Treasury secretary Janet Yellen embarked on a 10-day tour of three African countries at the start of the year to try and reaffirm the States\u2019 commitment to the continent.<\/p>\n<p>Sandun Munasinghe, Africa lead at the Tony Blair Institute, says that \u201cthe US has been a lot more stagnant in Africa compared to China, but could start to play a bigger role.\u201d<\/p>\n<p>In light of the battle for influence in Africa, Munasinghe believes that \u201cthe US could engage more with African government over the next decade and support regional frameworks, including the African Union\u2019s Vision 2063.\u201d Increased US economic and diplomatic support for Africa would undoubtedly be a boon for Africa\u2019s economy, particularly if the US and China find themselves in a spiral of one-upmanship in a bid for greater geopolitical advantage in Africa.<\/p>\n<p><b>Africa \u2018doesn\u2019t want to choose sides\u2019<\/b><\/p>\n<p>The IMF forecasts also rest on the assumption that, should the world divide into two opposed competing blocs, Africa would be forced to choose one partner over the other. However, as Knight points out, this would not necessarily be the case. \u201cAfrican governments have consistently voiced that they don\u2019t want to have to choose sides,\u201d he tells African Business.<\/p>\n<p>\u201cI think they\u2019ve actually been very effective in getting this message across. The US and China are more explicitly in competition with each other directly, and they understand that countries around the world don\u2019t want to make that choice.\u201d<\/p>\n<p>Knight notes that the US has attempted \u201cto force ultimatums\u201d before but that such a strategy \u201cis rarely successful\u201d. The US long tried to discourage African governments from allowing Chinese telecommunications company Huawei to build networks on the continent, for example, but failed. Components from the Chinese company are now used in around 70% of Africa\u2019s 4G networks. Partly because of this experience, Knight believes, \u201cthe US is stepping back from this kind of diplomacy and recognising that it\u2019s not as effective.\u201d<\/p>\n<p>Despite this, the risk does of course remain that the IMF\u2019s worst-case scenarios comes to fruition. Knight says that \u201cbusinesses in Africa that rely on collaboration between the US and China should be aware that it\u2019s a relationship that is in flux, and there may be risks associated with that.\u201d<\/p>\n<p>How does Africa go about hedging against these risks? Tayo says that \u201cother challenges, such as the Covid-19 pandemic and the Russia-Ukraine war, have already driven home the need to develop alternative supply chains as well as domestic ones.\u201d She suggests that geopolitical tension between East and West could further encourage African countries \u201cto push for local production of goods and services through implementing the African Continental Free Trade Area agreement\u201d.<\/p>\n<p>\u201cCountries and businesses should be positioning themselves for alternate futures, exploring other markets and fast-tracking the agenda for local production,\u201d Tayo adds.<\/p>\n<p>Much has been made of the \u201cdecoupling\u201d between the US and China and the potential impact of this on the rest of the world. But it is worth noting that business relationships between Washington and Beijing have, in some ways, never been stronger. According to the US Bureau of Economic Analysis (BEA), US-China trade in goods hit a new record in 2022, reaching $690.6bn. Is the risk of the world \u201csplitting into two isolated trading blocs\u201d a realistic one?<\/p>\n<p>\u201cI think the risks can be slightly overblown if you only look at intergovernmental relations,\u201d Knight says. \u201cIf you look at business relations, they still seem to be quite strong.\u201d<\/p>\n<p><b>african.business<\/b><\/p>\n<p><strong>For More News And Analysis About <a href=\"https:\/\/www.africa-press.net\/sierra-leone\">Sierra-Leone<\/a> Follow <a href=\"https:\/\/www.africa-press.net\/\">Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Harry Clynch Africa-Press &#8211; Sierra-Leone. A gloomy report from the IMF suggests that Africa could face \u201cpermanent decline\u201d if tensions between the West and China escalate, but some argue that the continent would still have the ability to shape its own role. At the start of May, the International Monetary Fund (IMF) issued a stark [&hellip;]<\/p>\n","protected":false},"author":84,"featured_media":17750,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,6],"tags":[291,293,292],"class_list":["post-17751","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-files","tag-africa-press","tag-africa-press-sierra-leone","tag-sierra-leone"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.1 (Yoast SEO v27.0) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Are US-China tensions bad for Africa? - Sierra Leone<\/title>\n<meta name=\"description\" content=\"A gloomy report from the IMF suggests that Africa could face \u201cpermanent decline\u201d if tensions between the West and China ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/sierra-leone\/all-news\/are-us-china-tensions-bad-for-africa\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Are US-China tensions bad for Africa?\" \/>\n<meta property=\"og:description\" content=\"A gloomy report from the IMF suggests that Africa could face \u201cpermanent decline\u201d if tensions between the West and China ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/sierra-leone\/all-news\/are-us-china-tensions-bad-for-africa\" \/>\n<meta property=\"og:site_name\" content=\"Sierra Leone\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2023-05-22T07:11:10+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-05-22T07:29:08+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/sierra-leone\/sites\/16\/2023\/05\/sm_1684727788.015268.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"800\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"6 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/sierra-leone\/all-news\/are-us-china-tensions-bad-for-africa#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/sierra-leone\/all-news\/are-us-china-tensions-bad-for-africa\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/sierra-leone\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Are US-China tensions bad for Africa?\",\"datePublished\":\"2023-05-22T07:11:10+00:00\",\"dateModified\":\"2023-05-22T07:29:08+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/sierra-leone\/all-news\/are-us-china-tensions-bad-for-africa\"},\"wordCount\":1193,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/sierra-leone\/all-news\/are-us-china-tensions-bad-for-africa#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/sierra-leone\/sites\/16\/2023\/05\/sm_1684727788.015268.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-Sierra-Leone\",\"Sierra-Leone\"],\"articleSection\":[\"all news\",\"files\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/sierra-leone\/all-news\/are-us-china-tensions-bad-for-africa#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/sierra-leone\/all-news\/are-us-china-tensions-bad-for-africa\",\"url\":\"https:\/\/www.africa-press.net\/sierra-leone\/all-news\/are-us-china-tensions-bad-for-africa\",\"name\":\"Are US-China tensions bad for Africa? 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