Wednesday, August 20, 2014

Forecasting: Why stories of China teaming up with the U.S. over Inga-3 are overblown

A lot of hay was made during the U.S.-Africa Summit about China possibly teaming up with the U.S. over the Inga-3 dam. I was quite unhappy with the quality of this coverage, as anyone could find out that this very project has been in the works for months with a quick Google search (this is the first thing that popped up for me), making this announcement not particularly newsworthy. I have a sneaking suspicion that, since the initial consortium of Chinese companies who will probably win the bid are SOEs with good relations with China's EXIM bank, and that Sicomines looks to be moving ahead in the DRC, and that Sinohydro is involved with both projects, that this is a public relations move by Chinese officials to lock in a certain amount of U.S. financing and construction and threaten the dam project with shutdown if the IMF looks to renegotiate Sicomines again. It also made China look particularly magnanimous during the summit while Chinese-language outlets were slamming the entire concept. Considering some of the rumored reasons why the Inga 3 collaboration shut down last time (happy to tell you in private), I am quite skeptical of the viability of this project.

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