"China finds small is beautiful for African projects under belt and road" 1 August 2022

[...] Addressing the third belt and road symposium in November, Chinese President Xi Jinping said high-quality “small and beautiful” projects, which are sustainable and improve people’s livelihoods, should be a priority in overseas cooperation.

China’s central bank has since issued new regulations capping external lending by the country’s banks.

Beijing has said it wants to see more private entities engage in Africa, noted Christian-Geraud Neema, a Congolese mining and policy analyst. [...]

One of the projects caught up in China’s strategy shift is a major railway in Kenya, built under the belt and road plan. At conception, the line was to run from Kenya’s coastal city of Mombasa to the Malaba border crossing with neighbouring Uganda. Plans were then extended to Ugandan capital Kampala and to other landlocked countries in the Great Lakes region. [...]

Zhou Yuyuan, a senior research fellow with the Centre for West Asian and African Studies at the Shanghai Institutes for International Studies, said the logic of more lending to small or medium-sized projects “makes sense, since it may project more inclusive, catalytic and impactful financing. In short, less big-hand financing, but more inclusive benefits to [belt and road] countries”.

“If the projects are promising with sound economic returns and social impact, I think Chinese financiers will continue to provide loans [to mega infrastructure projects] but may explore well-designed approaches,” Zhou said. [...]