Britain to invest in African ports as part of Western response to China

·4-min read
Berbera - SIMON MAINA/AFP/Getty Images
Berbera - SIMON MAINA/AFP/Getty Images

Britain is to pour hundreds of millions of pounds into developing African port infrastructure in a bid to win a "battle for economic influence" against China and other authoritarian states.

CDC Group, the Foreign Office's investment arm, will jointly underwrite a £1.25 billion plan to expand three ports in Egypt, Senegal and Somaliland, the unrecognised breakaway province of Somalia, in what a government source described as a direct challenge to "malign actors" in Africa.

Lizz Truss, the Foreign Secretary, said the projects would provide "reliable and honest investment in developing countries" and opportunities for British business.

It comes after US President Joe Biden called for a Western-led alternative to the Belt and Road Initiative, China's sprawling overseas infrastructure building program.

Liz Truss - Stefan Rousseau/PA
Liz Truss - Stefan Rousseau/PA

CDC said it would provide about £515 million ($720 million) to upgrade and expand three ports of Sokhna on the Red Sea, Dakar on the Atlantic, and Berbera on the Gulf of Aden in Somaliland, it said on Tuesday.

The remaining £710 million ($1billion) will be invested by the Dubai-based logistics group DP World as part of what the companies called a "long-term partnership to accelerate Africa’s long-term trade potential".

'Partnership will help address stark imbalance in global trade'

CDC and DP World said in a joint statement that the partnership "will help address the stark imbalance in global trade through supporting the modernisation and expansion of ports and inland logistics across Africa".

The companies said the investments would generate 138,000 jobs and indirectly support 5 million more in the Sahel and the Horn of Africa.

Both areas are theatres of intense geo-strategic competition, with Western governments competing for influence with China, Russia, and Middle Eastern powers including the United Arab Emirates and Turkey to provide investment and security assistance.

The expanded port at Berbera will seek to capture part of the trade traffic from Ethiopia, the biggest industrialised economy in the horn of Africa.

Much Ethiopian trade currently runs through the port in neighbouring Djibouti, which also hosts both Chinese and American military bases. A Chinese built railway from Addis Ababa to Djibouti opened in 2018.

The announcement comes four months after Britain endorsed an American call to invest in developing countries in response to "strategic competition from China", and diplomats have described it as part of a strategy to challenge "malign actors" on the continent.

'Infrastructure investment key to winning the battle for economic influence'

A Foreign Office source said: "The Foreign Secretary believes more infrastructure investment into developing countries will help counter authoritarian regimes. Ultimately she thinks we need to win the battle for economic influence and sees infrastructure investment as a key part of that plan along with closer trade and tech ties."

"We need to give more countries the option of closer economic links with democracies so they aren’t driven into the arms of malign actors. We want to work with like-minded parterres to take that ambition forwards."

More than 100 countries have signed up to China’s Belt and Road Initiative, a multi-trillion dollar overseas development scheme launched by Chinese President Xi Jinping in 2013

The Chinese project supports investment in ports, roads, railways and other infrastructure across Asia and into Europe and Africa, but is viewed in many Western capitals as an instrument for extending Beijing’s geopolitical influence.

Chinese lenders committed $153 billion to African public sector borrowers between 2000 and 2019, according to figures compiled by the China Africa Research Initiative at the Johns Hopkins School of Advanced and International Studies.

Mr Biden floated the idea of a Western-funded rival to the Belt and Road Initiative funded by democratic states in a phone call with Boris Johnson in March.

Mr Johnson and other G7 leaders formally endorsed an American plan as "an affirmative, positive, alternative vision for the world that is presented by China" at the G7 summit hosted by Mr Johnson in Cornwall in June.

The White House says the "Build Back Better World" (B3W) project will seek to narrow an estimated $40 trillion of infrastructure investment required to slow and adapt to the impacts of climate change in low and middle income countries.

Mr Johnson’s Government has frequently promoted investment in Africa as a source of post-Brexit trade growth.

Last year UK Export Finance, the Government’s export credit agency, provided £100 million for a project to redevelop a 114-mile road in Benin.

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