Chinese debt trap diplomacy in Africa: The experience Of Ghana

Abstract

Following its so-called “Go Out” policy, the People’s Republic of China has in recent times come under international scrutiny, particularly within Western circles, for deliberately burdening the world’s most impoverished nations with excessive public debt. Using the theoretical lens of neo-colonialism, combined with both existing data and data gathered from semi-structured interviews with key informants, we sought to scrutinize Ghana’s experiences in relation to the so-called Chinese debt diplomacy. This study concludes that while about only 7 per cent of Ghana’s entire public debt is owed to China, the rate of the indebtedness, yawning trade imbalance in favor of China, export of Ghana’s raw materials to China through the barter system without value addition, collateralization of Ghanaian resources and assets for Chinese loans, unbridled importation of Chinese manufactured goods into Ghana, influx of Chinese labor, and irregular migrants in the illegal mining enclaves are not only unhealthy and detrimental to Ghana but also have all the trappings of neo-colonial and center-periphery relationship. This requires transformational and diligent political leadership, co-ordinated approaches from state agencies, and a deliberate policy of economic transformation to rescue Ghana from this strategy of Chinese debt entrapment.