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Friday, December 2, 2022

China’s Algeria Connect

By Bhavdeep Modi

China’s Algeria Connect:

In May 2020, a spokesman for the Algerian President stated that China & Algeria share “distinguished relations”. He stressed on the help China provided to the African nation during the Algerian War (1954-62) and Algeria’s help to China for gaining a permanent seat at the United Nations Security Council (UNSC). Algeria established a comprehensive strategic partnership with China in 2014 and, signed an MoU on cooperation under the Belt & Road Initiative (BRI) at a summit in 2018. Trade between the two nations reached a record $9.1 billion dollars in 2018.

Trade between the two nations spans both infrastructure and defense. Algeria is the 3rd largest recipient of Chinese FDI with $2.5 billion dollars. Chinese are particularly interested in infrastructure projects in Algeria, taking up mega projects such as the Algiers Mosque, the East-West Highway and even in aerospace. A recent $6 billion-dollar deal has been finalized for a phosphate plant, that will yield $2 billion dollars every year, while creating at least 3,000 jobs. Huawei and ZTE have gained significant shares in the Algerian market, with Houari Boumediene Airport in Algiers becoming the first eLTE enabled airport in Africa. Infrastructure projects between Chinese and Algerian firms have been taken up in the fields of commercial vehicle manufacturing, electronics, mining and even maritime transport. Shaanxi Automobile Holding Group, a state-owned truck manufacturing company, has now control over 70% of the market.

In the area of defense, China has been making rapid gains, slowly becoming a major export hub for cheaper defense technology and equipment. Chinese has been establishing a foothold through defense exports to the African continent and Algeria is no exception. In 2016, Chinese defense exports to Algeria peaked at $511 million dollars. Various weapons orders were fulfilled, including three C-28A frigates.

But why is China investing so heavily in Africa? Well, there are numerous reasons for it. Firstly, China wants to reduce US influence in the continent. Trade between Africa & China was 3 times higher than Africa-US trade in 2017, which clearly shows a money & power shift in the African continent. Secondly, this particular tactic will also help China to gather the backing of African nations across all multilateral organizations, especially the UN. Another long-term goal that China aims to fulfil in Africa, is establishing its first overseas military base. China, currently, is in an expansionist mode. They are fulfilling this aspiration by either flaring up border disputes (Galwan and Vladivostok are two recent examples) or investing so much money in poor countries that they eventually become dependent on Chinese aid/money. Ultimately, Xi dreams of ending US unipolarity.

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