Chinese financing for African projects fell to 2.1 billion US dollars in 2024,marking the first annual decline since the COVID-19 pandemic, Reuters reported. 

The figure is less than a tenth of the 28.8 billion US dollars peak recorded in 2016, according to Boston University’s Global Development Policy Center.

In a shift from large-scale infrastructure projects, China increasingly focuses on smaller, commercially viable initiatives and yuan-denominated loans. In 2024, it funded six projects across the continent: two in Angola and one each in Kenya, Egypt, the Democratic Republic of Congo, and Senegal.

Angola received 1.45 billion US dollars for power grid and road upgrades, while Kenya’s infrastructure loans were all yuan-denominated. Kenya also converted 3.5 billion US dollars of previous loans to yuan in October. Ethiopia is considering a similar move, and the China Development Bank and the Development Bank of Southern Africa signed their first yuan-denominated financing deal last year.

Boston University’s Chinese Loans to Africa Database, tracking lending since 2000, highlighted a growing use of RMB-denominated loans, SME on-lending through domestic banks, and foreign direct investment rather than traditional development loans.

Historically, Chinese lending exceeded 10 billion US dollars annually between 2012 and 2018, with a record of nearly 30 billion US dollars in 2016, partly due to a 10 billion US dollars refinancing in Angola. Beijing has faced losses on some loans after the pandemic pushed Zambia, Ghana, and Ethiopia into default.

The report concluded that China’s approach now reflects a more selective and conservative phase of engagement, relying on market-based instruments that lower costs, mitigate debt risk, and support sustainable growth.