China’s Dam Dilemma: Strategic Competition in the Horn of Africa

The Washington administration seems incapable of solving the Nile River dispute through transactional means – but what role can China play in resolving such conflicts?

Ethiopians make shoes at a Chinese-owned factory (Associated Press)

On Saturday the 24th of October, Egyptians voted in the first stage of their parliamentary elections, a choreographed exercise anticipated to return a compliant lower legislative chamber expected to act as a pliant, rubber stamp body for President Abdel Fatteh El-Sisi. The predictability of the elections however belies a simmering uncertainty in the Nile Delta. As upstream Ethiopia pours its efforts into building the “Grand Ethiopian Renaissance Dam” (GERD) on the Blue Nile that could challenge Egypt’s security, the legitimacy and stability of their northern neighbours matters more than ever.

On the same day that Egyptians went to the polls, current President of the US, Donald Trump stated that Egypt might be tempted to “blow up” the dam, and that they’d “have to do something” about it during a phone call with the leaders of Israel and Sudan.  Egyptian leaders have been vocal in expressing their worries to the international community and the US in particular that the dam threatens Egypt’s water security and the sustainability of arable land.

Ethiopia reacted angrily to the comments – Prime Minister Abiy Ahmed said that “Ethiopians have never kneeled to obey their enemies, but [only] to respect their friends.” Despite a statement from the foreign ministry highlighting the “longstanding partnership” between the two countries, Trump’s words appear to have further alienated the rapidly rising East African nation.

Negotiations over the project collapsed in  the summer as Ethiopia accused the US of a lack of impartiality in its mediation and subsequently began filling the dam. Without a path to resolution in sight and domestic pressures hardening positions on both sides, the region teeters on the brink of instability, just as mutual neighbour Sudan begins to take tentative steps towards economic and diplomatic normalisation.

If disaster is to be avoided, some might be holding out for an intervention from China – Africa’s new strategic actor. Although not directly involved in construction of the dam, China has provided the finance for related projects and state-owned companies have been contracted to complete parts of the project. China is a huge investor in Ethiopia in general, one of the fastest growing economies in Africa and indeed the world, but it also maintains good ties with Egypt, providing the lion’s share of the initial funds for Egypt’s “New Administrative Capital” (NAC) project.

As a major power with historic ties to both nations (250,000 Chinese volunteers signed up to fight for Egypt during the Suez Crisis[1]) China may be  considered a more trusted mediator than most when it comes to resolving the issue. An attempt to bridge the divide with neutral, technical expertise on dam safety and predicted power outputs could help to bring the two sides together. Despite Beijing’s worries of losing out amidst competing interests, Egypt and Ethiopia have just as much to fear given that the flagship projects of both rulers – the NAC and the GERD – depend heavily on Chinese support.

For its part, Washington suspended aid to Ethiopia over the project after it began filling what will become Africa’s largest dam. The amount however seems unlikely to stymie construction. The dam itself is self-funded and the funds lost in aid can be found elsewhere or covered by selling excess electric capacity produced by the dam itself.

Where American “transactional diplomacy” has failed to persuade Ethiopia to change tack, forcing it instead to double down and seek allies and aid elsewhere, pragmatic Chinese diplomacy that prioritises peace could also protect its interests. Washington’s Egyptian partisanship may prove to be another blow to its international credibility – particularly important in fast-rising Africa – if China is seen to be a trusted representative of peace. The invoking of colonial treaties that claim the entirety of the Nile for Egypt do little to burnish the image of Western powers that side with it amongst African nations.

Whilst China appears to fear overstepping its influence too early, the communique from the Communist Party’s fifth plenum this week nevertheless mentions “a profound adjustment in the international balance of power.” To take a practical role in that re-balancing, Beijing must learn to see that investments don’t function according to normal market forces when geopolitics come into play. To play a leading role in global affairs and to better mould relations in its image, China’s leaders must be proactive with partners.

While the outcome of Egypt’s elections may be predetermined, the propensity for peace in the Horn of Africa certainly is not. Washington may have security interests in the region, cooperating with both nations in the fight against Daesh and Al-Shabab, but China appears to offer longer term solutions to the problems, through trade and development projects that enhance self-reliance and economic stability.

There is little likelihood of any Ethiopia-Egypt conflict developing into a new kind of proxy war between China and the US, not least because it would be detrimental for all sides of the equation. To ensure the stability and prosperity of the region however requires innovation and optimism, a chance for China to showcase what is meant by a “community of common destiny for the shared future of mankind”.

Donald Trump is eager for foreign policy victories before America’s election, but the CCP’s plenum has also made note of the “strategic opportunity” to “grasp the changing international situation” and should be looking for diplomatic victories to burnish its reputation as a reliable mediator. Competition between the two to secure peace in historically troubled parts of the world offers a glimmer of hope for multi-polar international relations. The proxy conflicts of the new Cold War still have the potential to look less like proxy wars, and more like proxy peace.

Ethiopia’s leader won the Nobel Peace Prize in 2019 for ending the stalemate with arch-rivals Eritrea. In recapturing the spirit of cooperation that bound the three countries together at Bandung to solve the dispute, peace and prosperity in the developing world may once again become the lofty ambition of the former Third World members – without the help of Washington.

[1]  Shichor, Y., 1979. The Middle East in China’s Foreign Policy. 2nd ed. London: Cambridge University Press.

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