Tillerson says African countries should weigh Chinese loans carefully

Faki and Tillerson hold a news conference at African Union (AU) headquarters in Addis Ababa, Ethiopia

African Union (AU) Commission Chairman Moussa Faki, of Chad, and U.S. Secretary of State Rex Tillerson hold a news conference after their meeting at African Union headquarters in Addis Ababa, Ethiopia March 8, 2018. 

U.S. Secretary of State Rex Tillerson said on Thursday that African countries should weigh Chinese loans carefully, while adding that Washington was not trying to keep Chinese investment away from the continent.

Tillerson, a former Exxon chief executive, is seeking to bolster security alliances on a continent increasingly turning to Beijing for aid and trade.

The top U.S. diplomat may also seek to smooth relations after U.S. President Trump reportedly dismissed some African nations as "shithole countries" in January. Trump later denied making the comment.

"We are not in any way attempting to keep Chinese dollars from Africa," Tillerson told a news conference in the Ethiopian capital during his first diplomatic trip to the continent. "(But) it is important that African countries carefully consider the terms of those agreements and not forfeit their sovereignty."

Though the United States is the leading donor of humanitarian aid to Africa, China surpassed the U.S. to become Africa's largest trading partner in 2009.

Beijing has pumped billions into infrastructure projects, though critics say there is often little upside for local economies because Chinese firms and labor build the roads and rails.

Tillerson took that line on Thursday, saying that Chinese investments "do not bring significant job creation locally" and criticized how Beijing structures loans to African government.

If a government accepts a Chinese loan and "gets into trouble", he said, it can "lose control of its own infrastructure or its own resources through default." He did not give examples.

Russian foreign minister Sergei Lavrov, visiting Zimbabwe on Thursday, told reporters he did not think it was appropriate for Tillerson to criticize China’s relationship with African countries.

Tillerson arrived in Ethiopia, Africa's second most populous nation, on Wednesday and visited the African Union headquarters on Thursday. The complex was fully funded and built by China and is seen as a symbol of Beijing's thrust for influence and access to the continent's natural resources.

Ethiopia is home to some of Beijing's biggest investments, from a railway to Djibouti that opened last year to factories and industrial parks.

His comments followed a speech earlier this week in which he criticized "China's approach" to Africa which he said encouraged dependency through "opaque contracts" and "predatory loan practices".

"We welcome Chinese participation, but we hope they will follow international rules, international norms and respect the sovereignty of countries," he said on Thursday.

REUTERS/Jonathan Ernst