China and Tanzania: A Relationship Deepening Over 60 Years and Its Economic Dynamics

 As China's influence across the African continent continues to grow, countries like Tanzania—with high tourism potential, a young population, and rich resources—are becoming focal points for Beijing's strategic investments. The strong ties and investments China has cultivated with Tanzania in recent years are significant not only economically but also from a geostrategic perspective.

Initiatives backed by China, ranging from major infrastructure projects to healthcare services, contribute to Tanzania's economic development while simultaneously consolidating China's influence in Africa.

A History of Diplomatic Relations Between Tanzania and China

Diplomatic relations between Tanzania and China began in 1961, immediately after Tanganyika gained independence. China opened its embassy in Dar es Salaam that same year. (Zanzibar declared independence in 1963, and Tanganyika and Zanzibar united to form the United Republic of Tanzania in 1964.)

Both nations shared similar ideological stances on independence movements and the anti-colonial struggle. Tanzania's founding leader, Julius Nyerere, who often praised Chinese socialism, made his first visit to China in 1968.

China made significant contributions to Tanzania's development projects, notably through the Tanzania-Zambia Railway (TAZARA) project, for which it was the sole contractor, helping to strengthen the country's economic infrastructure.

However, relations took a complex turn during the tenure of John Magufuli, known for his nationalist politics. Magufuli criticized some Chinese projects. In 2019, he labeled the $10 billion Bagamoyo port project as "colonial" and adopted a wary stance towards China. (This wariness was justified by China's attempts at the time to take over port operations in Djibouti and Kenya after they failed to repay loans on time.) Despite this, economic ties were never completely severed, and although Chinese investments in Tanzania were lower compared to other East African nations, they continued.

In 2015, a Confucius Institute opened in Dar es Salaam, aiming to introduce Tanzanians to Chinese culture through various events. This institute was the first Chinese cultural center to open in East Africa.

Most recently, in November 2022, Tanzanian President Samia Suluhu Hassan made an official visit to China. During this visit, the two countries signed 15 agreements in areas such as transport, trade, and agriculture. Relations with China have continued to deepen under President Hassan's leadership.

Tanzania's Strategic Importance for China

Within the framework of China's Africa policy, the Belt and Road Initiative (BRI), Tanzania stands out due to its increasing geostrategic importance. As one of Africa's fastest-growing economies, Chinese investments in Tanzania are concentrated in infrastructure, energy, mining, and construction.

The port of Dar es Salaam is crucial for securing China's trade with the continent. It facilitates both the transport of Africa's resources to China and the distribution of Chinese goods across Africa via East Africa. With the Kilwa port project, which it aims to complete by 2025, China plans to gain access to the southern part of the continent.

Sixty percent of Tanzania's land is arable, and with its three major rivers, the country holds a significant position in agriculture and fishing thanks to its rich water resources.

Valuable minerals extracted in the country, such as gold, diamonds, tanzanite, rubies, coal, and nickel, along with natural gas reserves, constitute other critical resources for the Tanzanian economy.

Hosting over a million tourists annually, Tanzania increased its tourism revenue to $3.4 billion in 2023, a 36% rise compared to the previous year.

China's Economic Impact and Interests in Tanzania

Ultimately, China is maintaining the economic dominance it pursues in many African countries within Tanzania as well. Today, China is Tanzania's largest investor. However, China's share of Tanzania's total exports is only 3.9%. This indicates that China gains incomparably more from this trade relationship.

China faces no rivals in the mining sector. So much so that most countries are forced to buy rare earth elements, essential for their technology, from China, which holds a monopoly on a vast majority of these elements. Despite China's dominance in the region, other countries are also taking strategic steps towards Africa's mineral wealth. For example, South Korea is increasing cooperation with resource-rich countries like Tanzania to reduce its dependence on African mineral sources.

In Tanzania's mining sector, China plays an active role in the extraction and processing of elements like nickel, copper, graphite, and iron and aims for further growth in the sector.

Unlike Western powers, while rapidly increasing its economic gains, China adds a humanitarian dimension to the relationship by offering support during Tanzania's difficult times. For instance, following devastating floods in April, China donated $500,000 to be spent on flood victims.

China also supports education by offering scholarships to Tanzanian students. In 2023, for example, the Chinese government provided scholarships to 46 Tanzanian students for studies at various Chinese higher education institutions and to 114 students for degree programs offered by the Chinese Ministry of Commerce.

Most recently, in July, China provided free healthcare services to the Tanzanian people via the hospital ship "Peace Ark," which docked in Dar es Salaam. (The ship will provide healthcare services to 11 African countries by 2025.)

China is also striving to build military relations with Tanzania. The Chinese military arrived in Tanzania in recent weeks to participate in a joint exercise with Tanzania and Mozambique. The Chinese Defense Ministry stated the exercise focused on counter-terrorism.

Economic Dependency

Diplomatic and trade relations between China and Tanzania are deepening each year, and China remains Tanzania's largest investor. Unlike Western powers, China is not plundering Tanzania's (and all of Africa's) resources; it is buying them (albeit often at very low prices). It is evident that China, with its vast trade volume, gains significantly more, just as it does across all of Africa.

During a strike last month in Kariakoo, Dar es Salaam's commercial center, concerns were raised that firms of Chinese origin were weakening the market and competitive power of local businesses.

On the other hand, China continues to offer massive loans to Tanzania, as it does to other African nations.

Tanzanian officials frequently express their satisfaction with Chinese investments, noting that China does not interfere in internal affairs and provides support in difficult times. However, the question of how the country will repay its ever-increasing debts raises the issue of economic dependency. A growing debt burden means putting national resources at risk. While China provides short-term ease for Tanzania, this situation could pose a long-term threat.

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Sources:
https://oec.world/en/profile/bilateral-country/chn/partner/tza
https://openaccess.izu.edu.tr/xmlui/bitstream/handle/20.500.12436/2383/663658.pdf?sequence=1&isAllowed=y

This article was originally published in Independent Türkçe, on August 6, 2024.