Nigeria, China Sign Deals, Commit to Deeper Economic Ties During Tinubu Visit:
It was only going to be a matter of time before Nigeria’s President Bola Ahmed Tinubu, as part of his economic diplomacy and drive for foreign investment in key sectors of the Nigerian economy, set his sights on a country whose phenomenal economic rise in a relatively short time during the last century, and its immense clout on the global stage, should rightly serve as a source of inspiration to, and a model for, emerging economies across the globe. The President’s interest in China as a source of both investment and mutually-beneficial bilateral partnerships, as well as socio-political solidarity, took concrete form last Tuesday, September 10, 2024, when he led a high-powered government delegation to Beijing, capital of the People’s Republic of China, for a series of engagements with that country’s business and political leaders.
The meetings, during which President Tinubu, his Chinese counterpart, Xi Jingping and other officials signed a raft of agreements spanning areas of investment and cooperation such as infrastructure and cultural exchanges, was held in the run-up to this year’s Forum on China-Africa Cooperation (FOCAC) which brings together the leaders of the People’s Republic and over forty African Heads of State and Government. The two leaders were reported to have discussed China’s ambitious $1 trillion infrastructure drive for Africa (as part of its Belt and Road Initiative) among other issues, and pledged their commitment to not only deepen economic ties but to elevate those ties into a ‘comprehensive strategic partnership’.
During the meetings, Tinubu made no pretence of his desire to position Nigeria as China’s No. 1 trade partner on the African continent, and to leverage on the unique relationship between Africa’s largest market and the second-largest (and soon to be THE largest) economy on the planet, and – as he has done on other missions of this nature – enumerated the various measures Nigeria has taken to ensure that foreign investors enjoy a robust return on investments in the country.
In particular, the two sides signed a number of deals covering the following areas:
- Bilateral Currency Swap: Nigeria and China agreed to expand on an agreement that was first initiated back in 2018, which will allow the Central Bank of Nigeria (CBN) and the People’s Bank of China (PBoC) to directly exchange their respective currencies, the naira and the yuan, to facilitate trade and commerce between the two nations without recourse to the US dollar. The new deal is expected to increase liquidity in the Nigerian market, ease trade transactions, and reduce the pressure on Nigeria’s foreign currency reserves.
- Infrastructure Agreement: Road, rail and energy projects formed the bulk of the discussions in Beijing, as China committed herself to providing funding for Nigeria’s infrastructure masterplan – in terms of completing outstanding rail projects, building major highways and developing energy facilities. Specifically, China pledged to provide funding and other support for the speedy completion of the Lagos-Calabar coastal highway.
- Power Generation Agreement: Power outages, of course, are among the biggest banes of Nigeria’s economic development. China is set to address this deficiency by helping to set up new power plants, upgrade existing facilities, and expand renewable energy sources such as hydro-electric and solar power. Also, the Tinubu administration is planning, with China’s help, to improve on Nigeria’s notoriously-low power generation capacity in a bid to eliminate blackouts (or reduce them to their barest minimum) in order to power Nigeria’s industrial potential.
- Mining & Solid Minerals Cooperation: The quest to diversify the Nigerian economy beyond oil – and to exploit the country’s vast solid mineral endowments – is a priority of the Tinubu administration. To this end, the Beijing summit featured agreements requiring the People’s Republic to provide Nigeria with the necessary technical expertise and equipment, as well as provisions for the training of Nigerian professionals in modern mining techniques.
- Technology & Telecommunications Agreement: The drive towards a digital economy was another major plank of President Tinubu’s trip, which culminated in the signing of an agreement aimed at enhancing Nigeria’s digital infrastructure; improving internet penetration; and fostering the growth of the tech sector in the country. Under this agreement, Chinese tech giants like Huawei are set to play a key role in deploying the 5G network across Nigeria, improving broadband access and promoting digital inclusion. The agreement is also expected to ensure closer cybersecurity cooperation between the two countries.
- Cultural Exchange & Education Agreement: This agreement is expected to ensure closer ties between Nigerian and Chinese educational institutions, and will cover student exchange programmes, including a marked increase in the award of scholarships. Another aim of the agreement is to promote the study of the Chinese language in Nigerian schools, as well as to increase the number of cultural exchange programmes between the two nations as a way of strengthening ties between their peoples, and promoting diplomacy at the grassroots level.
- Agricultural Cooperation Agreement: Food security and enhanced agricultural productivity are a particular concern for many countries around the world at this point in time – and Nigeria is no exception. The agreement that was signed to change the narrative in this regard will see to the transfer of Chinese agricultural technology, expertise and investment into the Nigerian agricultural sector. China also committed to providing funding for irrigation schemes, provision of modern farming equipment, and training for Nigerian farmers.
Summing up the exercise the next day, (Wednesday, September 11) at the opening of the Forum for China-Africa Cooperation, President Tinubu hailed the Nigeria-China agreements as confirmation of the truism that regional and global development was ‘not a zero-sum game’ (where one side benefits at the expense of another) and that the problems plaguing our world today can be overcome if countries work together in a spirit of mutual respect, trust and understanding in the pursuit of common goals. He expressed his optimism that if these agreements are implemented to the letter, they will ‘unlock an unprecedented level of growth and development’ for Nigeria (and by extension, Africa) and the People’s Republic of China.
That President Tinubu and his government set much store on this China trip and its game-changing potential for the Nigerian economy was never in doubt, going by the caliber of his entourage – which included the Governors of Lagos, Kaduna and Kwara States, as well as the Ministers of the Economy, Solid Minerals, Power, the Federal Capital Territory, Defence, Transportation, Information and National Orientation, and Foreign Affairs, as well as the Minister of State for Petroleum (Gas).
By all accounts, it was a resounding success; observers who noted the favorable – one might say, generous – terms of the Beijing agreements (from the Nigerian point of view) have expressed the conviction that faithful and meticulous implementation of all the provisions agreed to would definitely result in more jobs (especially for our teeming youths), increased productivity, value-addition and export, more external trade – and therefore more foreign exchange earnings – and higher levels of prosperity for the Nigerian people.
But beyond the material benefits accruable from this trip, lies an underlying potential benefit: the opportunity to learn (with a view to replicating) the conditions, the policies, and attitudes on the part of leaders and the led alike – that account for China’s near-miraculous rise from near-obscurity to the pinnacle of global prominence, vis-a-viz Nigeria’s equally sharp decline within the same time-period. A Nigerian public servant once admonished successive administrations: ‘Don’t just borrow money from China; borrow IDEAS, too.’
The Tinubu administration will do well to heed that admonition – even as it continues to consolidate on Nigeria’s close economic ties with China.