## Navigating the Evolving Landscape between China and Africa’s Economic Engagements

_IMF Working Papers, February 23, 2024_

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## Bibliographic details
- Authors: Wenjie Chen, Michele Fornino, Henry Rawlings
- Published: February 23, 2024
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9798400267840.001

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### Overview and scope
- Authors: Wenjie Chen, Michele Fornino, Henry Rawlings
- Publication date: February 23, 2024
- Series: IMF Working Papers, Working Paper No. 2024/037
- Pages: 34
- DOI: https://doi.org/10.5089/9798400267840.001
- ISBN: 9798400267840
- ISSN: 1018-5941
- Subject areas: Balance of payments; Exports; External debt; Financial institutions; Foreign aid; Foreign direct investment; International trade; Loans

### Evolution of China–Africa economic ties
- China and Africa forged a strong economic relationship beginning with China’s accession to the WTO in 2001.
- The paper examines the evolution of these ties starting in the early 2000s.

### Major structural shifts identified
- The relationship experienced a significant shift triggered by:
  - the commodity price collapse in 2015
  - the COVID-19 pandemic
- These shocks altered trade, investment, and financing patterns between China and African countries.

### Analysis of a potential further slowdown in Chinese growth
- The paper analyzes potential effects on the African continent from a further slowdown in Chinese growth.
- Findings emphasize heterogeneous impacts across African countries:
  - Countries heavily dependent on their economic relationship with China face larger adverse effects.
  - Variation in exposure arises from differences in export composition, foreign direct investment linkages, lending relationships, and external debt profiles.

### Policy discussion and adaptation options
- The conclusion discusses ways African countries and China could adapt to the changing relationship.
- Policy themes include:
  - Diversifying trade and investment partners and export baskets.
  - Strengthening domestic institutions and debt management frameworks.
  - Reorienting investment toward productivity-enhancing projects.
  - Enhancing regional integration to reduce vulnerability to bilateral shocks.

### Keywords and models cited
- Keywords: A. AFRMOD, Africa, AFRMOD model, Belt and Road Initiative., C. Investment linkage, Caribbean, China, Debt, economic engagement, Exports, Foreign direct investment, Global, growth slowdown, Investment, Lending, Loans, South America, sub-Saharan Africa, Trade

*IMF Working Paper No. 2024/037; Wenjie Chen, Michele Fornino, Henry Rawlings; February 23, 2024.*

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_Source: https://www.imf.org/en/publications/wp/issues/2024/02/23/navigating-the-evolving-landscape-between-china-and-africas-economic-engagements-545104_