Republic of the Congo

Republic of the Congo

One of a handful ‘pilot countries’ for cooperation in productive capacity between China and Africa, the Republic of the Congo is a key Chinese partner in the central African region. However, issues related to debt loom large on the bilateral relations.

Republic of the Congo

Written by Rundong Ning.

Historical Background

Republic of the Congo (RoC) and China were connected long before the African country achieved independence from France in 1960 and even before the establishment of the People’s Republic of China (PRC) in 1949. In 1929, a few hundred Chinese workers were recruited by the General Government of French Indochina to work in the mountainous region of Mayombe to build the Congo–Ocean Railway (also known by the French name Chemin de fer Congo–Océan) linking the Atlantic port of Pointe-Noire to Brazzaville. Since the establishment of diplomatic relations between the then newly independent RoC and the PRC in 1964, the two countries have remained on good terms. RoC President Denis Sassou Nguesso, who first came to power in 1979 and has ruled the country for 37 of the past 42 years, has visited China 15 times since 1980 (as of May 2021), while Xi Jinping has visited Congo once, in 2013, on his first diplomatic tour of African countries as the President of China.

From 1964 to 1978, trade between the two countries increased rapidly and was conducted through a barter-like system in which both sides took account of the goods traded and kept the trade in balance, without using foreign exchange. In 1978, both countries began to use foreign exchange for the payment of trade. From 1983 to 1992, exports from the PRC to the RoC experienced a downturn due to the decrease in oil income in Congo and the shortage of major goods in China, such as rice and dried fish, for export to Congo. Only later in the 1990s, and especially after the short but bloody civil war that erupted in the RoC in 1997–98, did bilateral trade resume its steady growth. China has been the RoC’s largest trading partner since 2014 and, according to the latest available data at the time of writing, in 2019, the bilateral trade volume had reached 6.5 billion USD.

In 1984, the two governments signed an agreement to establish the Mixed Commission for Economic, Trade, and Technical Cooperation (Commission mixte de coopération économique, commerciale et technique), a body tasked with facilitating bilateral trade and economic cooperation. This platform remains active and held its tenth meeting on 29 October 2020. In 2000, the Congolese and Chinese authorities also signed an agreement on the promotion and protection of mutual investment. This agreement set up a framework for coordinating such issues as investor privilege, expropriation, compensation, transfers of capital and profits, and dispute resolution in trade and investment between China and Congo. During the state visit of President Sassou Nguesso to China in 2016, the relationship between the RoC and the PRC was elevated to the level of ‘comprehensive strategic cooperative partnership’—one of the highest categories of bilateral relations in China’s diplomatic jargon.

BRI Status

The RoC has been involved in a series of cooperation programs with China, including the Belt and Road Initiative (BRI). In 2016, during President Sassou Nguesso’s state visit to China, the RoC was listed as one of the ‘pilot countries’ for cooperation in productive capacity between China and Africa (中非产能合作先行先试示范国家). A series of potential projects has been launched under this framework, including the Special Economic Zone of Pointe-Noire. The framework agreement for this cooperative project was signed during the Forum on China–Africa Cooperation (FOCAC) in 2018. Also during this summit, the two governments signed a memorandum of understanding on cooperation in the BRI.

Yet, rather than the BRI, most of the recent cooperative projects between the two countries fall under the framework of the ‘Eight Major Initiatives’ (EMI) between China and Africa proposed by President Xi at the FOCAC. The EMI covers industrial promotion, infrastructure connectivity, trade facilitation, green development, capacity-building, healthcare, people-to-people exchanges, and peace and security. As China’s Ministry of Commerce has explained, the EMI overlaps with the BRI in many aspects. The EMI was central to the agenda of both the latest meeting of the Mixed Commission in 2020 and the fifth Investing in Africa Forum (Forum Investir en Afrique), an event sponsored by the Government of the RoC, China’s Ministry of Finance, the China Development Bank, and the World Bank. Held in RoC’s capital, Brazzaville, in September 2019, the forum formulated the direction of the cooperation between China and the RoC towards the realisation of the EMI’s goals.

Current Economic Relations

Trade: The RoC enjoys a trade surplus with China due to exports of crude oil, minerals, and timber. In 2019, China’s exports to the RoC were valued at 440 million USD, while its imports from the RoC were worth 6.05 billion USD. The RoC is the second-largest African exporterp.35 of crude oil to China, after Angola. Congo exported its first 23,000 tonnes of iron ore to China in April 2019, joining the ranks of iron ore–exporting countries.

Investment: Foreign direct investment (FDI) by China in the RoC was worth 94.59 million USD in 2019, bringing the stock to 610 million USD by the end of the year. A few Chinese-invested projects are worth more than 100 million USD. Among them is the Kayo Oil Field, prospected and exploited by Wing Wah Petrochemical, a subsidiary of the Southernpec Group (南方石化集团), which is now in regular production. Another noteworthy project is the Soremi copper mine, which started production in 2017. Soremi is the first overseas project of the state-owned China National Gold Group Corporation (中国黄金集团), and the first mine in Congo that integrates mining and smelting. In the financial sector, the Agricultural Bank of China (ABC) has formed a joint venture with Congolese public and private investors to form the BSCA Bank, in which the ABC holds half of the shares. In 2019, the Congolese Government partnered with West-African Group (西非集团), a Chinese private company, to set up the Fonds national de développement du Congo (FNDC), which aims to promote investment in agriculture, industry, tourism, health, and education in RoC.

Figure 1

Source: Chinese Ministry of Commerce.

Chinese companies play a major role in the construction sector in the RoC, with a market share of more than 70%. In 2019, Chinese companies won 38 contracts for construction projects worth a total of 297 million USD. Examples of new large-scale construction projects include housing projects in Pointe-Noire and Owando contracted to the Shandong Zijian Construction Group and the maintenance of National Roads 1 and 2 contracted to the China State Construction Engineering Corporation.

Aid: China has been a significant provider of aid to the RoC, ranging from turnkey construction projects to medical teams. Recent aid projects include the grand library of the University of Marien Ngouabi, delivered in 2016, the Sino-Congolese Friendship Hospital, completed in 2013, and the new parliament building, delivered in 2021. Since 1966, China has been sending medical teams to Congo to provide medical services to local people as part of its foreign aid program, with the twenty-seventh such medical team dispatched in October 2020, in the middle of the COVID-19 pandemic. Since the outbreak of the pandemic, China has also donated medical supplies to RoC.

Key Controversies in Bilateral Relations

A significant, controversial aspect of China’s engagement with Congo is debt. Congo’s major creditors include multilateral development banks, bilateral creditors such as China and France, and major commodities trading companies such as Glencore and Trafigura. As of 2019, RoC’s total public debt stood at 85% of its gross domestic product (GDP), with China the country’s largest creditor. Negotiations on restructuring the RoC’s debt with China, which amounted to 2.2 billion USDp. 33 as of September 2019, started in 2017, and concluded in April 2019. In June 2021, it was reported that Congo had again requested further rescheduling of its debt with China, to which President Xi agreed.

According to the agreement reached between RoC and the Export–Import Bank of China in 2019, Congo will repay one-third of the debt owed to China generated between 2010 and 2014 in the three years after the agreement comes into effect, while the maturity on the rest will be extended by 15 years. The loans covered by the agreement involved eight construction contracts, most of which if not all were contracted to Chinese companies. The annual interest rate on seven of the loans was fixed at 1.5%, and at 2% for the other. Since 2015, many Congolese and Chinese companies have experienced great difficulty in getting paid for the work they had already done, and many projects under construction have been halted, as observed during the author’s fieldwork. The 2019 debt restructuring agreement opened the way for the RoC to negotiate a bailout program from the International Monetary Fund, as the restructuring of the debts with China was an essential part of this program. China also provided pandemic-related debt relief, forgiving interest-free loans granted to Congo that matured at the end of 2020, although the value of these loans is unclear.

Key Sources

Local Media Outlets:

La Semaine Africaine

Les Dépêches de Brazzaville

Vox Congo

Books and Reports:

Bokilo, Julien. 2012. La Chine au Congo-Brazzaville: Stratégie de l’enracinement et conséquences sur le développement en Afrique [China in Congo-Brazzaville: Roots Strategy and Consequences for Development in Africa]. Paris: L’Harmattan.

Cover Photo: Panorama Mayombe, Niari, Republic of Congo. Credit: (CC) Christophe André.

Updated on 29 June 2021.

Rundong Ning is a PhD candidate in anthropology at Yale University. His dissertation research is about entrepreneurship and changing modes of work in Congo-Brazzaville. He also studies international money transfer in Congo and China–Africa connections. His research interests include work, entrepreneurship, volunteerism, finance, and science, technology, and society. He has done fieldwork in Africa and China.