La relación C ONSONANTE V OCAL en la propuesta de Jakobson, Fant y

In March 2007, the former president of the World Bank accused China of fol- lowing a “free rider” strategy in Africa by lending to countries that had just been granted debt relief. The Heavily Indebted Poor Countries (HIPC) Initiative launched during the 1990s has reduced Africa’s external debt from 80 percent of GDP (1995) to 35 percent (2006), at a cost of 64 billion US$ to the international community. Of the 31 countries eligible for this initiative,26 _{eighteen have ben-}

efited from debt relief. Concern for avoiding a resurgence of indebtedness that could lead to another crisis has led the IMF and World Bank (2004) to develop a Debt Sustainability Framework (DSF). This framework sets a debt ceiling above which the risk of default can become very high; separate ceilings are established for three groups of countries according to their CPIA ranking.27 _{The categories}

of risk (low, moderate and high) determine the appropriate proportions of grants and loans. The DSF is intended as an instrument for coordinating the terms of financing. It has prescriptive force for the IDA (World Bank Group), but it is merely indicative for the other organizations: for example, some have chosen to lend only to low-risk countries, while others are willing to lend to medium-risk countries.

The DSF applies only to those donors that accept its legitimacy. If China refuses to cooperate, the collective effort of the other donors will be much less effective, and this is indeed a criticism that is often raised regarding China’s aid policy. However (see Table 3.2), the estimated breakdown of its aid by country shows that the countries to which China provides the most assistance are not those that have enjoyed the largest debt remissions.

 Jean-R aphaël Chaponnière

Table 3.2 Chinese aid and the HIPC countries

HIPC debt relief Chinese cooperation

Millions of USD % of GDP % of GDP Benin Burkina Faso Cameroon Ethiopia Ghana Madagascar Malawi Mali Mauritania Mozambique Niger Uganda Rwanda Senegal Sierra Leone Tanzania Zambia 1 096 1 160 1 298 3 217 3 823 2 323 2 227 1 915 850 1 992 1 048 3 397 530 2 392 870 3 728 2 687 24.80 20 7.80 25.20 35.70 49.30 107.30 36.40 45.00 29.80 30.70 39.00 24.80 28.70 71.60 30.70 37.30 0 0 0 0.9 0.7 0.3 0 3.2 3.2 0.1 0.6 0 0 0.3 0 1.5 0.4

Sources: Djoufelkit (2007) and Chinese statistics on international cooperation minus projects fi nanced by multilateral bodies

The Democratic Republic of Congo is in a different situation. This country, clas- sified as being between the decision and completion points, may hope for forgive- ness of some of its debt (eight billion US$), but such a decision could be compro- mised by the announcement of a five billion US$ loan from China (September 2007) to finance major infrastructural projects that is secured by the granting of mining leases.28 _{As copper prices plummeted in 2008, DRC is in a dire need of a}

debt relief from Western donors and the latter want a renegotiation of the China DRC deal. The focus of concern is that the deal would give the Chinese con- sortium state financial guarantees including some that earmarked government revenues and make China a privileged creditor.29

 Chinese aid to Africa, origins, forms and issues

Th e Washington consensus and the Beijing consensus

Adhering to the principle of non-intervention, China imposes no conditions for its aid, but there are two exceptions to the rule. Breaking off diplomatic relations with Taiwan has long stood as a prior condition for aid from China. This is no longer really an issue, since owing to its economic success, China has “won the war” over UN representation. It now has cooperation agreements with countries that maintained relations with Taiwan. Beijing does, however, expect support for its positions at the United Nations: for example, it requests African support for its opposition to a Security Council seat for Japan or to elect a candidate to a top job in a United Nations organization (a recent example is the World Health Organization). Moreover, the strict secrecy surrounding the publication of data on aid and credit terms to Africa suggests that Chinese authorities may require a contractual undertaking not to publish the data.

Apart from these points, China ’s aid is not subject to conditionality, in contrast to that of the OECD countries. As long as African countries do not express their willingness for social and environmental responsibility (SER), Chinese firms face no requirements for SER and their method can lead to abuses, as in the example of the Merowe dam in Sudan. It does not comply with international standards, and its construction caused the displacement of the local inhabitants to distant locations where the land was not suitable for farming. The Chinese government recognizes these abuses but, on grounds of non-interference, refuses to take the initiative of requiring SER clauses in contracts.

China ’s attitude has led Rano (2004) to propose the concept of a “Beijing con- sensus” as opposed to the Washington consensus. According to Rano, both pursue the same goals but in a diff erent order of priority, with Beijing giving priority to stability and development while the Washington consensus views reforms as a pre-condition for stability and development. Leonard (2008) wrote that the Beijing consensus could be the worst ideological menace to the Western world since the collapse of communism. While the Washington consensus favors privatization, the Beijing consensus encourages the use of public money and a push to protect public property. Th ese diff erences contribute to the positive image of China in Africa where Asian heterodox strategies have long been regarded with deep interest.30 _Chinese

aid is attractive to the countries that are most resistant to reform, such as Angola , which was granted a loan of two billion US$ at a time when it was being called on to account for the disappearance of four billion US$ from the public treasury. It is also attractive to countries that have suff ered from instability caused by overly mechanical application of reforms designed according to the Washington consensus.

The 2008 world crisis that led the Western countries to proceed to large-scale nationalization has weakened the ground of the Washington consensus. On this

 Jean-R aphaël Chaponnière

occasion, Chinese vice Prime Minister Wang Qishan said the “teachers have some problems”.31 _{Nevertheless, while the crisis will reinforce the appeal of the Beijing} consensus, this new paradigm does not translate into practical measures. As time passes, circumstances may lead China to change its practice. Loans by the Exim Bank account for a rising share of China’s aid commitment, and being more concerned about repayment, it pays closer attention to country risk and becomes more attentive to countries’ indebtedness. As a larger number of countries facing difficulties will flock to Beijing, the Chinese government may have to take a closer view of their economic prospects and to differentiate between them.