In the last two decades, China has emerged as a dominant player in Africa’s energy sector, financing and constructing power plants, oil refineries, and renewable energy projects across the continent.
From the sun-soaked deserts of North Africa to the oil-rich Niger Delta, Chinese investments have become a cornerstone of Africa’s energy infrastructure.
However, this growing influence has sparked a heated debate among policymakers, economists, and civil society groups.
While some laud China’s role in addressing Africa’s chronic energy deficits, others warn of a looming “debt trap” that could undermine the continent’s economic sovereignty.
Africa’s energy crisis is well-documented. Over 600 million people—nearly half the continent’s population—lack access to electricity.
This energy poverty stifles economic growth, limits educational opportunities, and exacerbates health crises.
For decades, Western nations and international financial institutions have pledged to bridge this gap, but progress has been slow and often mired in bureaucratic red tape.
Enter China, with its deep pockets, rapid project execution, and a policy of non-interference in domestic affairs.
Through initiatives like the Belt and Road Initiative (BRI), China has poured billions of dollars into Africa’s energy sector, building dams, solar farms, and wind turbines at an unprecedented scale.
Yet, as the number of Chinese-funded projects grows, so do concerns about the terms of these investments.
Critics argue that China’s loans often come with high interest rates and opaque conditions, leaving African nations vulnerable to unsustainable debt.
Example includes Zambia, which has struggled to repay Chinese loans tied to infrastructure projects, as evidence of a broader pattern.
The term “debt-trap diplomacy” has entered the lexicon, suggesting that China deliberately ensnares developing nations in debt to gain strategic leverage.
Proponents of China’s approach, however, counter that these investments are a win-win.
They argue that China is filling a critical gap left by traditional donors, providing much-needed infrastructure without the strings of political conditionality.
They also highlight the role of Chinese technology in advancing renewable energy projects, which are crucial for combating climate change.
For many African leaders, the choice is clear: accept Chinese investment and accelerate development, or wait indefinitely for Western aid that may never materialize.
China’s strategic interests in Africa’s energy sector
China’s interest in Africa’s energy sector is driven by a combination of economic, political, and strategic factors.
At its core, China’s investment strategy is rooted in its need to secure resources to fuel its own economic growth.
As the world’s largest energy consumer, China relies heavily on imports of oil, gas, and other raw materials. Africa, with its vast reserves of natural resources, is a natural partner in this regard.
But China’s ambitions extend beyond resource extraction. By investing in Africa’s energy infrastructure, China is positioning itself as a key player in the global energy market.
Projects like the Mambilla Hydropower Plant in Nigeria and the Adama Wind Farm in Ethiopia not only generate electricity for local populations but also serve as showcases for Chinese technology and engineering prowess.
These projects enhance China’s soft power, fostering goodwill and strengthening diplomatic ties with African nations.
Moreover, China’s investments align with its broader geopolitical strategy.
The Belt and Road Initiative, which aims to create a network of trade and infrastructure linking Asia, Europe, and Africa, is central to this strategy.
By financing energy projects in Africa, China is building the infrastructure needed to facilitate trade and economic integration along the BRI route. This, in turn, reinforces China’s position as a global superpower.
The Debt trap debate: myth or reality?
The term “debt trap” has become a rallying cry for critics of China’s investment strategy.
They argue that China’s loans are designed to burden African nations with unsustainable debt, forcing them to cede control of strategic assets or make political concessions.
The case of Sri Lanka’s Hambantota Port, which was leased to China for 99 years after the country defaulted on its loans, is often cited as a cautionary tale.
However, the reality is more nuanced.
While it is true that some African nations have struggled to repay Chinese loans, it is not clear that this is part of a deliberate strategy by China.
Many of these loans were taken on by African governments eager to fast-track development, often without adequate consideration of their ability to repay.
In some cases, corruption and mismanagement have exacerbated the problem.
Dr. John Mbaku, a professor of economics at Weber State University and a nonresident senior fellow at the Brookings Institution, offers a balanced perspective.
“The debt trap narrative oversimplifies a complex issue,” he says.
“While there are legitimate concerns about the terms of some Chinese loans, it is important to recognize that African governments have agency.
“They choose to take on these loans, often because they see no viable alternative. The real challenge is ensuring that these investments are used effectively and transparently.”
Dr. Mbaku elaborates further:
“African nations must take responsibility for their borrowing decisions. It is not enough to blame China for offering loans; African governments must also ensure that these funds are used for their intended purposes.
“This requires strong institutions, transparent procurement processes, and accountability mechanisms to prevent corruption and mismanagement. Without these safeguards, even the most well-intentioned investments can go awry.
The role of renewable energy
One area where China’s investment has the potential to make a transformative impact is renewable energy.
Africa is uniquely positioned to harness solar, wind, and geothermal energy, thanks to its abundant natural resources.
Chinese companies have been at the forefront of developing these technologies, offering affordable and scalable solutions.
For example, the Noor Ouarzazate Solar Complex in Morocco, partially financed by China, is one of the largest solar power plants in the world.
Similarly, the Lake Turkana Wind Power Project in Kenya, which received Chinese funding, has significantly boosted the country’s energy capacity.
These projects not only provide clean energy but also create jobs and stimulate local economies.
Dr. Yinka Opeke, an energy policy expert and senior research fellow at the University of Lagos, emphasizes the importance of renewable energy in Africa’s development.
“Renewable energy is not just about addressing climate change; it’s about empowering communities and driving economic growth,” she says.
“China’s investment in this sector has the potential to be a game-changer, but it must be done in a way that prioritizes sustainability and local ownership.”
Case study: Nigeria’s energy sector and Chinese investment
Nigeria, Africa’s largest economy and most populous nation, has long struggled with energy deficits despite being one of the continent’s top oil producers.
With an estimated 200 million people, only about 60% of Nigerians have access to electricity, and even those with access face frequent power outages.
To address this, Nigeria has turned to China for financing and expertise in energy infrastructure. However, the relationship has been a mix of progress and pitfalls, raising questions about the sustainability of these investments.
Key Chinese-funded projects in Nigeria
- Mambilla Hydropower project
The Mambilla Hydropower Project, located in Taraba State, is one of Nigeria’s most ambitious energy projects. With an estimated cost of $5.8 billion, the project is expected to generate 3,050 megawatts (MW) of electricity, making it one of the largest hydropower plants in Africa.
China’s Export-Import Bank is financing 85% of the project, while the Nigerian government covers the remaining 15%.
The project, however, has faced significant delays due to legal disputes, bureaucratic hurdles, and concerns about environmental impact. - Zungeru Hydroelectric power plant
Another major Chinese-funded project is the Zungeru Hydroelectric Power Plant in Niger State, with a capacity of 700 MW.
Constructed by China National Electric Engineering Company (CNEEC), the project is expected to significantly boost Nigeria’s electricity supply.
However, the $1.3 billion loan from China’s Exim Bank has raised concerns about Nigeria’s growing debt burden. - Solar power projects
China has also invested in renewable energy projects in Nigeria, including the construction of solar power plants.
For example, the 100 MW solar power plant in Jigawa State, funded by Chinese companies, is part of Nigeria’s efforts to diversify its energy mix and reduce reliance on fossil fuels.
Challenges and Concerns
- Debt Sustainability
Nigeria’s debt to China has grown significantly in recent years, with Chinese loans accounting for a substantial portion of the country’s external debt.
As of 2023, Nigeria owes China over $3 billion, primarily for infrastructure projects.
Critics argue that the terms of these loans, including high interest rates and collateral agreements, could jeopardize Nigeria’s economic sovereignty. - Project Delays and Corruption
Many Chinese-funded projects in Nigeria have been plagued by delays, cost overruns, and allegations of corruption.
For instance, the Mambilla Hydropower Project, first proposed in the 1970s, has yet to break ground due to legal disputes and mismanagement.
These issues have raised questions about the effectiveness of Chinese investments in addressing Nigeria’s energy needs. - Environmental and Social Impact
Large-scale infrastructure projects like the Mambilla Dam have raised concerns about their environmental and social impact.
Critics argue that the displacement of local communities and the potential ecological damage could outweigh the benefits of increased energy production.
Despite these challenges, Chinese investments have brought significant benefits to Nigeria’s energy sector.
The Zungeru Hydroelectric Power Plant, for example, is expected to provide electricity to millions of Nigerians and create thousands of jobs during and after construction. Additionally, China’s expertise in renewable energy has helped Nigeria diversify its energy mix and reduce its carbon footprint.
Case study: Zambia’s energy sector
Zambia’s experience with Chinese investment offers valuable insights into the opportunities and challenges of this relationship.
Over the past decade, China has financed several energy projects in Zambia, including the Kafue Gorge Lower Hydropower Plant and the Lusaka South Multi-Facility Economic Zone.
These projects have helped to alleviate Zambia’s chronic power shortages and attract foreign investment.
However, Zambia’s growing debt to China has raised concerns. In 2020, the country defaulted on its Eurobond payments, prompting fears that it could lose control of key assets.
Critics argue that Zambia’s debt crisis is a direct result of its reliance on Chinese loans, which often come with high interest rates and short repayment periods.
Yet, others point out that Zambia’s debt problems are not unique to its relationship with China.
The country has also borrowed heavily from Western institutions and private creditors. The real issue, they argue, is a lack of fiscal discipline and transparency in how these loans are used.
Way forward
China’s investment in Africa’s energy sector is a double-edged sword.
On one hand, it has brought much-needed infrastructure and technology to a continent grappling with energy poverty.
On the other hand, it has raised legitimate concerns about debt sustainability and economic sovereignty.
The key to unlocking the potential of this relationship lies in transparency, accountability, and a commitment to mutual benefit.
As Africa continues to navigate its energy transition, the role of Chinese investment will remain a topic of intense debate—and, hopefully, constructive dialogue.