Published on: 01/18/2023 – 08:52
Janet Yellen, US Secretary of the Treasury, begins a ten-day tour of Africa. Barely a month after the US-Africa Summit, his visit confirms renewed American engagement on the continent where China is omnipresent.
With around ten travel days in three countries – Senegal, Zambia and South Africa – Janet Yellen wants to take the time to listen to make up for lost time after the Trump brace, a president who has completely lost interest in Africa. And above all, to compensate for the influence and market shares lost to China.
Beijing is the mainland’s largest creditor, but also the first trading partner. Trade between Africa and the United States is four times less important than with the Middle Kingdom. “Chinafrica” relies on a very active Chinese diplomacy with regular tours such as the annual trip of the Secretary of State. The new head of Chinese diplomacy, Qin Gang, has just performed this ritual. He tried to mend Beijing’s seedy image by denouncing “the Chinese debt trap,” a bad test being done to his country.
transparency
Janet Yellen sees Beijing as the main obstacle to solving the debt crisis. She wants to score points with this file. His speech and his initiatives will undoubtedly attract a lot of attention on a continent where half of the countries are now in financial distress. Covid-19, the war in Ukraine and the rise in American interest rates are weakening their finances and could plunge the most vulnerable into a new debt crisis.
Zambia, the second leg of his journey, is a textbook case. This heavily indebted country still unable to reach an agreement with this adamant creditor on China, which defaulted in 2020 in the midst of a pandemic. However, it has asked for negotiations within the framework of the G20, as previously Chad and Ethiopia and more recently Ghana have done. Janet Yellen wants to promote more transparency. Beijing has imposed confidentiality clauses on its African debtors. The finance minister insists that these often unfair conditions be made public.
Meanwhile, Beijing is stepping up efforts to rid itself of its bad reputation. But always with maximum coverage. Last week, Qin Gang announced the cancellation of part of Ethiopia’s debt and a temporary cancellation agreement with Benin, without disclosing the amounts involved. On the African continent, debt management is becoming an issue of renewed competition between Beijing and Washington.
Calm tensions
Before her trip to Dakar, Janet Yellen is passing through Zurich, where she will meet on January 18th with the Chinese Deputy Prime Minister, who is in charge of economic files. In Africa, the two countries have to convince Africans in particular with concrete gestures. The US government says it wants a new partnership, not based on humanitarian or security grounds, but based on trade and investment to sustain growth. A renewed interest that needs to be sustained over time to be credible.
For the time being, the United States only plays a supporting role. Today, Africa is particularly hopeful that the reopening of China will result in a rapid business revival, with an increase in trade, tourism and, of course, exports of commodities to restart growth.