China experienced a massive economic boom in the 1990s and 2000s which increased its demand for resource imports, like oil, from Africa. This led to a model of development finance in which China funded infrastructure in African countries in return for access to resources. This approach became known as the Angola model, because it all started with an infrastructure-for-petroleum partnership between China and Angola in 2004.
Within a decade, however, a shift in China’s approach was needed, for a couple of reasons.
First, African countries are vulnerable to shocks and they struggle to keep up with mounting debt repayments. For instance, in Angola’s case, the price of oil fell from a high of US$115 to below US$50 in mid-2014. More recently, the impact of COVID’s economic shutdowns and supply shocks around the war on Ukraine are taking a toll.
