Why China, US fight for Tanzania, Kenya

President Jakaya Kikwete and his Kenyan counterpart Uhuru Kenyatta share a light moment on Saturday when they met at the Dubai International Airport during their respective journey back home from the US-Africa Leaders Summit in the US. photo | STATE HOUSE

What you need to know:

  • With Tanzania’s natural gas reserves valued between $750 billion and $1.2 trillion, and Kenya’s oil estimated at $1 trillion, the scramble for East Africa region by both Washington and Beijing, goes beyond aid
  • During the just-ended summit, American leaders marketed the US as offering the best partnership to Africa with President Obama’s aides describing China’s dealing in Africa as a “patron” relationship

Dar es Salaam. President Barack Obama, in his new bid to overtake growing Chinese influence in Tanzania and East African region as whole, is coming up with billions of dollars in aid and trade promotion—but with the usual Washington’s approach of carrot and stick.

China came with a simple theory: Give us what we need and in return, you have aid, soft loans and trade pact—with no meddling in domestic politics let alone talking about gay rights, democracy and human rights.

According to a report by The East African newspaper, while East African presidents and business leaders emphasised in Washington last week that the region was open for business, not aid, President Obama said that the US wanted to be an “equal” partner in Africa’s growing success—a move aimed at putting in check China’s power.

“We don’t simply want to extract minerals from the ground for our growth; we want to build genuine partnerships that create jobs and opportunity for all our peoples and that unleash the next era of African growth,” President Obama told the forum, which included 50 African heads of state.

  According to a report by regional newspaper, one of the tempting outcomes for five East African countries is President Obama’s pledge of $300 million in assistance per year to expand the reach of Power Africa in pursuit of a new, aggregate goal of 30,000MW which has, reportedly, already mobilised more than $26 billion.

During the just-ended summit, American leaders marketed the US as offering the best partnership to Africa with President Obama’s aides describing China’s dealing in Africa as a “patron” relationship.

  The Obama administration accused the over 800 Chinese firms operating in Africa of refusing to employ local skills while flying in Chinese nationals to do jobs that locals could handle.

US Vice President Joe Bidden, in an apparent swipe at China, said: “America is proud of the extent to which our investment in Africa goes hand-in-hand with our efforts to hire and train locals to foster economic development and not just to extract what’s in the ground.”  But, the sudden shift of Washington policy toward Africa, is also viewed suspiciously—with some asking: why now?  The suspicion is evidenced by various articles, both analyses and opinions published by regional media after the US-Africa Summit.

 For instance on Sunday, Rwanda’s New Times newspaper, which is very close to President Paul Kagame’s regime, put it this way: “Figuratively put, Africa is enjoying a stable relationship with China when the USA, a returning ex-boyfriend, with renewed interest, shows up promising paradise”

 The New Times in a story headlined, ‘US-Africa Summit: How East Africa will benefit’,  wrote: “Choices have to be made but who should Africa trust between China and US?  Is the US a new admirer or a returning ex-boyfriend with renewed interest who now wants his partner back?”

 Various commentators noted that America’s new engagement with Africa is not voluntary but rather, a partnership forced by China’s deepening influence on the continent.

From Washington, Tanzania and Kenya would benefit from the $27 billion power Africa pact to finance power projects in gas, geothermal, coal and hydro power. Tanzania, Uganda and Rwanda are also included in a $110 million pledge for peacekeeping in Somalia, South Sudan and Central African Republic. Other peacekeeping beneficiaries are Ghana, Senegal, and Ethiopia.

 Tanzania is also the biggest recipient of Millennium Challenge Account, which has helped the country improve power production during the past few years and the second phase worth millions of dollars is due for takeoff in few months

Rwanda sealed a deal with Symbion Power for a 50MW Lake Kivu methane gas plant and a promise of US military action against the FDLR rebels if they do not surrender by the end of the year. Symbion currently operates various power projects in Tanzania.

 At the same time, Chinese were keenly monitoring the just ended summit in Washington well knowing that someone is plotting for their cake in East Africa—putting the region in the eyes of two global powerful ‘suitors’ whose appetite goes beyond trade and aid.

 Just after the US-Africa Summit, the Beijing-based Global Times newspaper published an article noting that China gives what Africa wants—trade and respect.

 According to data published by the UK’s Guardian newspaper, China has so far financed 62 projects in Tanzania through soft loans and aid including the Mtwara-Dar es Salaam gas pipeline funded at the cost of $1.3 billion, while in Kenya, Beijing has financed a total of 65 projects that also include the construction of Lamu Port, Standard Gauge Railways and expansion of Mombasa port.  China has also financed 53 projects in Uganda, 56 projects in Rwanda, and 22 projects in Burundi.

 Tanzania is so far number two in terms of loans and aid which by the end of last year reached $5billion, while Kenya tops the list in the region after both President Mwai Kibaki and his successor, Uhuru Kenyatta, decided to embrace the dragon.

 Why the EA region

 The East African region, is attracting two major economic and military giants, China and US, mainly because of its vast natural resources and strategic locations for security in Africa.

 For instance, Tanzania has discovered natural gas valued at $600 billion—enough to lure investors from both China and US. Apart from natural gas, the country is also rich in terms of minerals including gold, diamond, coal, nickel, uranium etc.

 Strategically, Tanzania is a crucial ally to Washington because of its stability and political influence in East and Southern African region.

 Kenya has recently announced a major discovery of oil, a commodity always wanted by US and Chinese companies, though Washington has more oil reserve than any country in the world. Strategically, Kenya is a crucial ally because of the horn of Africa, Sudan and South Sudan.

  Bloomberg News Channel reported last year that Kenya’s deposits could top 10 billion barrels, more than three times the UK’s remaining reserves. Kenya is set to start shipments in 2016, overtaking neighboring Uganda, where Tullow Oil found crude more than seven years ago.

Uganda, which discovered oil in 2007, is also a crucial ally of US mainly because of the situation in DR Congo, Central African Republic and South Sudan. Rwanda, has no vast natural resources, but is always viewed as a crucial military ally to US when it comes to the politics of DRC.

 While America’s interest always goes beyond trade and aid, China’s appetite is natural resources mainly minerals, oil, gas and coal to sustain its fast growing economy. In Dar es Salaam, last year, President Xi jinping said China sincerely hopes was to see faster development in African countries and a better life for African people.