At a Crossroads - Sub-Saharan Africa’s Economic Relations with China

Publisher:
International Monetary Fund
Publication Date:
13 October 2023
Tags:
Africa, Asia, Australia, and Africa, Economy, Business and Finance, International Organizations and Africa

Sub-Saharan Africa has forged broadly beneficial economic ties with China over the last two decades. China has become the region's largest trading partner, a major credit provider, and a significant source of foreign direct investment (FDI). However, China's support to Africa has also faced some criticisms. Recently, China has retrenched its financing activities in sub-Saharan Africa amid a growth slowdown and reduced risk appetite. The projected future deceleration in China's growth is likely to affect African trading partners negatively over the medium term, mainly through reduced trade. Therefore, it is crucial that countries in the region strengthen their resilience and implement structural reforms to foster economic diversification, deepen intraregional trade, enhance competitiveness, and catalyze domestic growth.

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