Chinese Development Finance and Strategies of Political (and Territorial) Survival in Sudan

Chinese aid to and investment in the infrastructure sector in Sudan and many other African countries have the potential to usher in the most important restructuring of the state since colonialism.

May 8, 2013
Philip Roessler

China has been a major supplier of development finance and investment to Sudan since the mid- to late-1990s, when the authorities in Khartoum sought strategic partnerships with Asian governments to circumvent Western sanctions.   Chinese support has helped ensure that the Sudanese government can extract and export oil. China National Petroleum Corporation (CNPC) was one of the largest investors in Sudan’s dormant oil industry, helping to build production facilities and a 1,506 km oil pipeline that connected the oil fields to Port Sudan.  China has been the largest importer of Sudanese oil from 1999 onward.

But Chinese support has gone far beyond oil.  Of more than $5 billion in official development finance commitments from China to Sudan (depicted in the map below) between 2000 and 2011, none has been allocated for oil exploitation.  Instead, a substantial majority has been invested in power generation (such as the Merowe hydroelectric dam that was financed with a huge loan from the China Exim Bank) and transportation networks (such as the Khartoum-Port Sudan railway link built with more than $1 billion in export credits from the Chinese government).    

chinese project locations and darfur region in sudan

As is illustrated in the map, a disproportionate amount of the largest development projects have been located in the strategic corridor that runs from North Kordofan and White Nile up to Port Sudan—the historical center of the Sudanese state since its modern creation under the Ottomans in the 1820.   There are efficiency gains that come from upgrading and strengthening transportation networks and energy generation in and around the country’s most developed regions.  But Chinese development finance also fits squarely into the long-term strategic plans of the ruling National Congress Party (NCP) as laid out in 2005 in a strategy paper by former Minister for Economy and Finance, Abdel Rahim Hamdi.  

Writing at a time shortly after the signing of the Comprehensive Peace Agreement (CPA) with the Sudan People’s Liberation Army (SPLA) that would pave the way for the secession of South Sudan, Hamdi foresaw two key threats arising from the CPA—elections during the interim period and the centrifugal forces that the partition of the country would unleash.  To combat these threats Hamdi advocated for “very big and very fast” non-oil investment that targeted the “geographical North…that has carried the Arab Islamic flag for several centuries.”  According to Hamdi, such investment was critical for electoral success because the NCP’s base is concentrated in these areas and will tend to vote based on whether the party delivers services and employment opportunities.  In what made great politics, on the eve of his re-election bid in 2010, Sudan’s President, Omar al-Bashir, launched the completion of the Merowe hydroelectric power station, which was claimed, by Sinohydro, one of the principal Chinese companies involved in the project, to have doubled the country’s electrification level, especially in key pro-NCP constituencies in northern and central Sudan and Kordofan.

Beyond the immediate election, Hamdi also was looking toward the potential partition of the country.  He felt non-oil foreign investment was critical to ensuring that the “[Northern] Axis will continue as a viable state” even as South Sudan and possibly Darfur secede.

Today, Hamdi’s thesis is being put to the test.  The Sudan state is hanging together by threads as the South has seceded (taking 75 percent of the country’s oil with it) and war rages in Darfur, South Kordofan, and Blue Nile.  But the center is holding (despite major internal dissension within the ruling party)—partly in thanks to the billion dollars in development finance received from the Chinese in the decade before the independence of South Sudan.

Chinese aid to and investment in the infrastructure sector in Sudan and many other African countries have the potential to usher in the most important restructuring of the state since colonialism.  The projects in Darfur and South Kordofan depicted on the map above are primarily road construction activities geared toward extending the reach of the Sudanese state and strengthening links between the center and periphery.  (Interestingly, one key road project is the Western Salvation Road that is to connect Kordofan with Darfur.  The NCP’s failure to complete this road in the 1990s became a rallying cry for the Darfur rebels in the lead up to war in that region).  But Chinese aid and investment also has the potential to reinforce existing inequalities and further fuel internal conflicts, if, as in Sudan, the ruling elite tries to leverage external sources of funding as an instrument of political survival.

Philip Roessler is an Assistant Professor at the College of William and Mary. In addition to his research on the coup-civil war nexus in Africa, he is a co-principal investigator on a multi-year panel survey that studies the micro-dynamics of state partition in Sudan.