China's approach to African investment is undergoing a strategic shift, as President Xi Jinping aims for higher returns and less complications from African debt deals.
China has injected over $120 billion into Africa, mainly through the Belt and Road Initiative (BRI), to fund various infrastructure projects, increasing its influence across the continent.
However, the challenges of debt difficulties and problems that have erupted in several African countries have prompted Beijing to reconsider its methods.
Historically, China's lending through state-run policy banks has seen significant growth, peaking at $28.8 billion in 2016.
This approach, however, has led to accusations of debt traps and mismanagement, highlighted by abandoned projects and financial restructuring in countries such as Zambia and Kenya.
To overcome this issue, China is now moving towards public-private partnerships, which aim to balance profit-making with risk-sharing.
In the meantime, the partnership allows cash-strapped African governments to continue borrowing without adding to officially declared government debt.
Despite criticism of its non-transparent practices and potential long-term debt burden, China's strategy is still welcomed by many African leaders who see it as a way to secure much-needed infrastructure investment.
Beijing's influence in Africa continues to loom large even as the country modifies its financial strategy, giving the continent options for large-scale development aid.
