The construction giant, which has been in charge of major infrastructure projects across Africa, including the Ethiopian hydropower dam, is doubling down on its partnerships with several African countries, even as other Chinese companies begin to exercise caution.
“We focus more on the financial performance of the project. Let’s do the projects with good cash flow first,” Chen Guanfu, an executive vice president at the company in charge of foreign business, said in an interview last week.
And “we pay more attention to the medium-size or small-size projects,” he said, considering the strategy in light of Ethiopia, Ghana, and Zambia’s government debt defaults.
Given the financial complication, several Chinese businesses have become vigilant in their dealings with some African markets.
2016 saw a peak of approximately $29 billion in Chinese funding to Africa, as seen on Bloomberg.
Since then, Chinese financing to Africa has steadily declined, up until September 2024, when the president of China, Xi Jinping, announced that China would increase its support to Africa, pledging nearly $51 billion in funding.
The agreements were announced at the Forum on China-Africa Cooperation Summit in Beijing.
China, the world’s largest lender, also committed to triple its infrastructure investments in on the continent.
China Power, despite the situation, seems adamant in tapping into the African economy, as it is now seeking more chances of obtaining financing from lenders, who are more apprehensive after defaults.
“Only in this way we can secure the financing from lenders,” Chen said, while speaking to Bloomberg in Johannesburg.
“If there is no financing, there is no project.”
The engineering company typically financed projects in countries like Zambia through state lenders like the Export-Import Bank of China.
However, the majority of a 100 megawatt solar power facility in the copper-rich nation was funded this year by a division of Standard Bank Group Ltd.
“We always look at the African market as one of our most important markets, even though sometimes it develops quickly, sometimes slowly,” Chen stated.
“There is huge potential not only for electricity, for water, for industrialization, and also for infrastructure,” he added.
Power China has maintained its attention on the continent despite its debt because of this potential.
