China’s emerging diplomatic and economic presence in North Africa

North Africa matters to China. In strategic terms, it is part of China’s overarching political strategy known as the ‘Great Rejuvenation of the Chinese Nation’. The aim of this self-assigned historic mission is to return China to prosperity and prestige. Its is economic development. As such, economic exchange is the fundamental driver of China’s relations with North Africa. Since approximately 2000, China has rapidly become a leading trade and investment partner to North Africa, giving it significant new political leverage in the region. But as this trade with the region represents only a small proportion of China’s total overseas exchanges, North Africa does not figure in the first rank of Beijing’s foreign policy priorities.

The political and geostrategic dimensions of Beijing’s North African ties are growing in salience, most notably in the context of the Belt and Road Initiative and China’s newly assertive diplomacy under Xi Jinping. The absence of an effective North African regional organisation means the relationships are fundamentally bilateral, showing varying degrees of depth and dynamism. Anti-colonialist and Cold War legacies linger. China was the first non-Arab country to recognise the Algerian Provisional Government in 1958, and Nasser’s Egypt was an important anti-colonialist and Non-Aligned partner. However, China’s diplomatic relations in the region are not limited by this historical legacy. For example, relations with the close US partner Morocco are growing rapidly, with extensive economic and diplomatic exchanges encouraged by Mohammed VI. Meanwhile, the region’s traditional prioritisation of other powers – Europe, the US, the Gulf – has left some relationships with China marginal, notably Tunisia’s (though efforts are underway to overcome this deficit). China continues to eschew formal alliances, which it sees as redolent of US client-imperialism. Instead, ‘strategic partnerships’ are a key diplomatic tool. Beijing has established multiple such partnerships worldwide in recent years, with much success. These deals have been so numerous that Beijing has subsequently created a scaled terminology, with ranks of partnership through which partners can progress, with various forms of ‘comprehensive’ strategic partnerships at the top. Beijing successfully leverages the incentive of promotion to ‘new heights’ in pursuit of its diplomatic goals. Since 2014, China has established four strategic partnerships in North Africa, with Morocco, Sudan, Algeria, and Egypt, the latter two being at ‘comprehensive’ level. This designation is on the one hand symbolic, indicating the relative importance Beijing attaches to the relationship. But it also provides a framework for enhanced practical cooperation, with more frequent summitry and Joint Declarations outlining diverse areas of political exchange.

A different perspective on the region

For the Chinese, as for other observers, North African countries share both an African and a (principally Arab-Islamic) Middle-East-North-Africa identity (though Chinese terminology is ‘West Asia North Africa’, ‘WANA’, rather than ‘MENA’). This has a tangible impact on another prominent Chinese diplomatic tool: the creation of seemingly multilateral, Chinese-led regional fora. The countries of North Africa are unusual in belonging to both the Forum of China Africa Cooperation (FOCAC, established 2000) and the China Arab States Cooperation Forum (CASCF, established 2004). Beijing successfully leverages the scale and fanfare of FOCAC and CASCF (and analogous formats in Latin America and Eastern Europe) to generate political and public diplomacy dividends, while limiting bargaining costs through a format that amalgamates bilateral relationships rather than allows genuine coordination by regional countries to exert their full diplomatic weight. This format preserves   China’s relative strength vis-à-vis individual participants, allows for time-efficient bilateral diplomatic meetings and even stimulates competition amongst members. Beijing has notably used membership of FOCAC as an inducement to Taiwan’s remaining African allies to sever ties with Taipei. While FOCAC is the more prominent format, both serve as an important framework to organise and continuously develop relations with North Africa through regular summitry and numerous specialised subsidiary structures (ensuring follow-up on FOCAC Action Plans and pursuing cooperation on tourism, technology and research).

China as an economic power in North Africa

Prior to the late 1990s, China’s economic presence in North Africa was negligible. However, replicating a trend in all regions worldwide driven by China’s economic take-off, since approximately 2000 China has emerged as a notable trade and investment partner to all countries in the region. Total trade volumes increased more than 17-fold between 1999 and 2017, from USD 1.76 billion to USD 30.26 billion. China is a top-three import origin for all North African countries and is a top-ten export market for Egypt, Libya, Mauritania and Sudan. As elsewhere, China’s explicitly ‘no-strings-attached’ approach – i.e. no governance or human rights conditionality and criticism – has been an important attraction facilitating economic ties, for example in Bashir’s Sudan and Sisi’s Egypt.

A prominent factor in China’s economic advent in North Africa has been its quest for resources to fuel its industrialisation, most notably hydrocarbons from Algeria, Sudan, and Libya, as well as Mauritanian iron ore and Moroccan copper, zinc and lead. In 2010, China received 10 percent of Libya’s oil exports, representing a sizeable but not dominant 5 percent of China’s total oil imports. These exports were impacted by the 2011 Libyan Civil War, but in 2018 doubled year-on-year to USD 3.5 billion in value. Moreover, China’s strategy towards North Africa also includes Sudan, a country that plays a significant role in China’s thinking about the wider region as it dominates Sudan’s oil sector. In 2016 China was the destination for 94 percent of Sudan’s oil exports (and 100 percent from South Sudan, which China still treats as part of the WANA region). These supplies – though not a large proportion of China’s total – are a key element of the region’s strategic salience for Beijing.

As elsewhere in Africa, China’s presence in North Africa is as much about infrastructure as resources, whilst also increasingly expanding into other sectors. Chinese-built big-ticket projects are prolific in the region. Examples include both the East-West Highway and Africa’s longest railway tunnel in Algeria, Egypt’s New Administrative Capital, Morocco’s Mohammed VI Bridge, as well as extensive telecommunications infrastructure investment, led by Huawei and ZTE. China is exporting its own development experience, which privileges infrastructure construction, and the expertise generated in the process – but also overcapacity in its saturated domestic construction market. It is also responding to genuine demand from African markets. The continent faces an estimated USD 170 billion annual infrastructure funding shortfall, hindering economic growth. Some of the need is acute – as with China’s earlier role in reconstruction after Algeria’s Civil War, Chinese companies are poised to play a major role in Libya’s reconstruction, something actively solicited by Libya’s Government of National Accord.

Throughout the region, trade balances are firmly in China’s favour, with China’s USD 25 billion aggregate exports to the region five-times greater than its USD 5.2 billion imports. Overwhelmingly, China imports North-African resources and low-value products and in return provides manufactured goods, an increasing share of which are high-tech products. As in other regions, this resource-for-manufacturing exchange and flood of cheap Chinese goods has provoked fears of a negative impact on regional industries. In response, Beijing is encouraging Chinese enterprises to increase investment in manufacturing within Africa, as flagged by Xi Jinping at 2018’s FOCAC Summit. To achieve this, China is exporting a further element of its own development experience: special economic zones. Ambitious Chinese-funded free-trade zones and industrial parks, such as Morocco’s Mohamed VI Tangier Tech City and the China-Egypt Suez Economic and Trade Cooperation Zone, offer Chinese companies a local manufacturing base and, crucially, local economies much-needed jobs.

China‘s Belt and Road Initiative and North Africa

This construction of infrastructure and trade zones is a crucial element of the framework that now dominates China’s approach to North Africa: the Belt and Road Initiative (BRI). What was launched in 2013 as a trans-Eurasian economic development and logistic corridor retracing the historic ‘Silk Road’ has broken the bounds of its original logic into a global endeavour encompassing almost all of China’s international economic statecraft. The BRI’s close personal association with the increasingly authoritarian Xi Jinping, coupled with systemically weak credit controls and industrial overcapacity has enabled the BRI’s seemingly uncontrolled expansion. North African countries are most directly impacted by the ‘Maritime Silk Road’, a sea-borne trade corridor connecting China to Europe via Egypt’s Suez Canal and the Mediterranean Sea. But North Africa is also implicated in the wider premise of the BRI: new industrial centres connected by new, expanded or rerouted trade links facilitated by new connectivity infrastructure. While originally peripheral, all of Africa is now included in the BRI; 37 African states have already officially joined and Beijing explicitly expects all remaining countries to follow suit. All North African countries bar Mauritania have signed memoranda of understanding confirming their participation. The goal is a network of China-enabled trade connectivity across the entire continent. This means connectivity amongst the countries of North Africa as well as across the Mediterranean and the Sahara.

This vision chimes well with the aims of many North African countries to strengthen economic links with both Europe and Sub-Saharan Africa. Africa’s economic development is stunted by a lack of intra-African trade, representing only 16% of the total, compared to 19% in Latin America and 51% in Asia. The Maghreb, which is particularly fractured by divisions between Algeria and Morocco,, has a rate of only 4.8%. Overturning this deficit is a major regional goal, with the African Continental Free Trade Area and infrastructure such as the Trans-African Highway Network the most prominent proposed remedies. North Africa is actively seeking closer trade ties with Sub-Saharan Africa, led by Morocco, which has successfully stepped up its presence in West Africa in recent years. In 2017, Morocco applied to join the West-African trade bloc ECOWAS and the following year Tunisia joined COMESA, its East-African counterpart. Meanwhile, trans-Mediterranean trade is extensive, and Algeria, Egypt, Morocco and Tunisia – unlike China – all have free-trade agreements with the EU. For China, the opportunity to contribute to and exploit North Africa’s potential as a trans-Mediterranean and trans-Saharan trade hub (through its infrastructure construction and localisation of manufacturing in new economic zones) is highly appealing and a major goal of the BRI in the coming years.

Economic and political risks

However, the BRI also exposes North Africa to risks. The BRI is controversial – and it faces opposition from the US, EU, India, and others. Firstly, by reshaping global trade patterns, China is seeking to generate political leverage and achieve geopolitical goals. Beijing’s increasingly assertive foreign policy is providing an indication of the political risk of granting Beijing greater economic leverage. Indeed, the BRI is explicitly not limited to solely economics. Rather, an ever-expanding range of activities are identified as contributing to BRI cooperation, including military-to-military, counter-terrorism, and judicial cooperation. China’s establishment in 2017 of its first permanent overseas military base, in the strategically-located Djibouti, a stop on the Maritime Silk Road where China’s economic penetration has rapidly expanded, is indicative of China’s geostrategic ambitions and the ways the BRI may come to serve them. The countries of North Africa may in time offer China a military presence in the Mediterranean.   Secondly, the BRI’s conformity to international tendering norms is doubtful, with Chinese state-owned enterprises favoured, concentrating the economic benefits in Chinese hands. Thirdly, the financial viability and sustainability of the multi-trillion dollar BRI has also been questioned. IMF head Christine Lagarde has warned of the risks to host countries of exposure to unsustainable debt through the BRI, which were highlighted by Sri Lanka’s surrendering of a port to China in a debt agreement.

The BRI looks set to decisively shape Chinese activities in North Africa into the foreseeable future. So far, North Africa has embraced the BRI – and the potential rewards are indeed considerable. Ties with China will not in the near future displace the higher priority of relations with the US and Europe. But China’s role will continue to grow, both quantitatively and qualitatively. Beijing is seeking a greater role in African peace and security while also looking to address the perceived nexus between its own domestic security and developments in WANA – in the shape of Islamist extremism. China’s approach to this issue may in coming years threaten its relations with North Africa, as its growing suppression of Islam at home alienates publics in the region.

Tom Bayes is currently a visiting fellow at the Mercator Institute for China Studies (MERICS) in Berlin, where his research focuses on China-Africa relations. He holds degrees from the University of Oxford and the London School of Economics, where he specialised in Chinese foreign policy. Prior to MERICS, Bayes worked in China; at the UK Permanent Representation to the EU in Brussels; and in Africa-focused corporate intelligence and investigations, based out of London.

© Photo “Ouverture du Focac-62” by presidencebenin is licensed under CC by-nc-nd 2.0


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