The construction giant, which has been responsible for major infrastructure projects across Africa, including a hydroelectric dam in Ethiopia, is stepping up partnerships with several African countries, even as other Chinese companies have begun to show caution.
“We are more focused on the financial performance of the project. Let’s execute the project with good cash flow first,” Chen Guanfu, the company’s executive vice president of overseas operations, said in an interview last week.
“We are looking more at medium-sized and small-scale projects,” he said, weighing the strategy in light of sovereign debt defaults in Ethiopia, Ghana and Zambia.
Given the financial complexities, some Chinese companies are wary of doing business with some African markets.
According to Bloomberg, in 2016, China’s funding to Africa reached about $29 billion.
Since then, China’s lending to Africa has steadily declined, until in September 2024, Chinese President Xi Jinping announced that he would expand aid to Africa, pledging nearly $51 billion in financing.
The agreement was announced at the China-Africa Cooperation Summit Forum in Beijing.
China, the world’s largest financial institution, has also pledged to triple its infrastructure investment on the continent.
Despite this, China Power remains adamant about entering the African economy and is seeking more financing opportunities from lenders who are increasingly worried about defaults.
“Only in this way can we secure financing from lenders,” Chen told Bloomberg in an interview in Johannesburg.
“Without funding, there is no project.”
The engineering firm typically financed projects in countries such as Zambia through state-run financial institutions such as the Export-Import Bank of China.
But the bulk of the 100 megawatt solar farm in the copper-rich country was financed this year by a unit of Standard Bank Group.
“We always consider the African market as one of the most important markets, even though it may develop quickly or slowly,” Chen said.
“There is huge potential, not just in power, water, industrialization and infrastructure,” he added.
Power China continues to draw attention to the continent, despite its debt, thanks to this potential.
