China's Africa lending nearly halved in 2024, shifts to yuan
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Chinese lending to Africa nearly halved to $2.1 billion in 2024, marking the first annual decline since the COVID-19 pandemic, as China shifted toward more selective, strategic projects, according to data released by Boston University.
The 2024 total is less than a tenth of the $28.8 billion peak recorded in 2016, and reflects a move away from large infrastructure builds such as railways and roads toward smaller projects seen as commercially viable, Boston University’s Global Development Policy Center said. The report noted that Chinese lending consistently exceeded $10 billion a year between 2012 and 2018, but that Beijing took losses on some loans after pandemic-era stress contributed to defaults in Zambia, Ghana and Ethiopia.
Boston University’s Chinese Loans to Africa Database, which tracks lending to the continent back to 2000, found that China is increasingly moving away from dollar-denominated megaprojects and toward targeted, smaller-scale financing denominated in yuan. The report also pointed to increased use of RMB loans, SME on-lending through domestic banks in African countries, and foreign direct investment as China leans more on investment rather than traditional development lending.
In 2024, all Chinese infrastructure loans to Kenya were yuan-denominated, the research showed, and Kenya converted $3.5 billion worth of loans from China into yuan in October. Ethiopia is also considering a shift, and the China Development Bank and the Development Bank of Southern Africa signed a deal last year for their first yuan-denominated financing cooperation, the report said.
Financing for projects above $1 billion declined, with more funding channeled via regional African banks into projects viewed as commercially viable, and China funded six projects across Africa in 2024—two in Angola and one each in Kenya, Egypt, the Democratic Republic of Congo and Senegal. Angola was the top recipient, securing $1.45 billion for power grid and road upgrades, a pattern the report said reflects a combination of more conservative direct lending and market-based tools aimed at lowering costs and managing debt risks while supporting sustainable growth objectives.
