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Alba Iulia
Tuesday, March 31, 2020

Japan invests three times more project money in Africa than China

Economy Japan invests three times more project money in Africa than China

FILE: Heads of States pose for a photograph shortly before the   opening of the  5th Tokyo International Conference on African development at Pacifico Yokohama Conference Centre in Japan
FILE: Heads of States pose for a photograph shortly before the opening of the 5th Tokyo International Conference on African development at Pacifico Yokohama Conference Centre in Japan

Bloomberg news reports that Japan has invested more in project financing in Africa than China as Asian nations continue to strengthen their economic influence on the continent, according to Linklaters LLP.

Japanese investors accounted for $3.5 billion of the $4.2 billion of project funds that Asian nations poured into Africa last year to improve roads, water and sanitation and build oil and gas pipelines, according to the London-based law firm.

“Japan now ranks as the most active Asian project finance sponsor in Africa, investing almost three times as much as China, which is often regarded as the most active Asian investor on the continent,” according to the report published Monday.

Japan now ranks as the most active Asian project finance sponsor in Africa, investing almost three times as much as China

Sub-Saharan African nations are seeking to reverse years of under-investment by moving forward with road and rail projects to help boost economic growth, which is forecast by the International Monetary Fund to expand 4.9 percent this year, more than double the rate of advanced economies. Asian investors are among those seeking deals to develop oil, gas and mineral deposits in African nations, which are exploiting their natural resources to boost revenue to fund development plans.

China ranked as the second-biggest Asian financier of projects in Africa, committing more than $11.9 billion over the past decade, with more than half spent in South Africa, while India placed third, Linklaters said.

“Japan has a much quieter and below-the-radar approach, less headline-grabbing than Chinese investment,” said Andrew Jones, head of Linklaters’ Africa unit, in an interview with Bloomberg TV Africa. “We had a phase 10 to 15 years ago where there were some big Japanese investments into Africa and now there’s a new wave of investment coming.”

A significant amount of Japanese investors’ money for projects went into Morocco last year, according to the study. The North African country said in September that Japan will provide the majority of funds to build a coal-fired power plant in the western city of Safi, which will produce 1,386 megawatts, or 25 percent of the country’s needs.

Japan has a much quieter and below-the-radar approach, less headline-grabbing than Chinese investment

“We’ve seen a mixture of securing fuel and natural resources, but also selling equipment like turbines for power stations,” Jones said of Japanese investment in Africa.

Nigeria, South Africa and Mozambique have attracted the most project financing from Asian investors in Africa over the past 10 years, according to Linklaters.

Project financing is a method of funding whereby debt repayments are sourced primarily from the forecast cash flows of a venture and security is limited to its assets.

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17 COMMENTS

  1. And how many times does Zambia invest in any economy on earth apart from the leaders’ pockets!

  2. African politicians do not sign enough on the Japanese aid because Japan has cut out corruption. Politicians are happy with dark corner meetings for fattening their pockets hence they are always lining themselves up in China.

  3. Zambia especially under the PF have not strategically positioned them selves to receive proper investment from credible countries like Japan. The answer is simple, how do they receive kick backs(Bushe Ba lyamo shani).The Japanese Government have a system of supervising all their projects so that they get value from there investments this what corrupt PF leaders don’t want. They instead rush to china which is very corrupt to cut deals, hence compromising standards of almost all projects done so far. My fellow Zambians lets open our eyes and ears so that we can see and hear, what our oppressors are doing. Lets vote them out even if their our relatives because corruption destroys a country and is the future of our children. These politicians only strive to enrich themselves and their…

  4. If an African President can be having meetings with a vice president of a mere corporation in China…then you will know why African Presidents like our Edgar Lazy personally rush to China.

  5. Zambia, please, can we also start investing in other countries economies. Set up milling companies in neighbouring DR Congo, Zimbabwe, etc. Export farm products to countries that have limited resources.

    Furthermore start assisting other people and our people with tangible things. Stop being on the receiving end all the time. Start giving generously.

    May the Lord Almighty bless Zambia.

  6. the monies being mentioned here are serious amounts….what I don’t understand is that despite such HUGE amounts….there is still a high number of people not accessing clean water….
    ….annual $4.2billion into Africa now let LLP also tell us the net value of resources taken out of Africa during same period……u will be shocked to learn that its in the range of over $12billion of which about $8billion goes to China…
    ….Africa…. Africa.. please…..for how long are we going to remain half asleep….the problem is that most of the politicians presiding in Africa now are those with colonial hang-overs…born in colonial era…..maybe 50 years from now when a new crop/generation of politicians completely detached from colonialism take over will bring sanity to this nonsense…

  7. Banama che, China surpasses ’em all. And it is we respected our own. Always negative about yourselves. What a shame!

  8. Spellcheck,
    Screwing is better than nailing. nailing anything is so inferior so much as compared to screwing. Mind your language. Your friend ?ZedpoorPeople has just screwed it in your head.
    upnd of screwing in their heads. Eish..

  9. actually a large number of investment for the Japanese seems to be in infrastructure which if someone considers that aid i will take it any day …..but we definatly need that aid to be turned into industrial development in only Dambisa Moyo was minster of finance or advisory to the Zambian government……. though minds like hers are consider ‘elite‘ and short commodity globally

  10. I think I prefer Japan from the dragon but the problem isjapan is too cautious of their investment in Africa. The dragon is fearess but practices the tiger economy too much!

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