Who is winning the majority of construction contracts in Africa?

China-based construction companies are winning just under a third of African infrastructure contracts valued at US$50 million or more in 2022, more than Western firms, which only won 12%, according to a recent report from the Hinrich Foundation, an Asia-centric philanthropic organization.

The increasing dominance of Chinese firms is a recent development. During the 1990s, approximately eight out of every ten contracts aimed at constructing infrastructure across Africa were secured by Western companies. 

In 2013, Western firms were said to be overseeing 37% of African infrastructure projects, while Chinese companies held a 12% share.

But things are different now, as highlighted by Keith M. Rockwell in the Hinrich Foundation report: Chinese enterprises have garnered a 31% stake in African infrastructure contracts valued at US$50 million or more in 2022, in contrast to Western firms, which stood at 12%. 

Rockwell’s report examines China’s involvement in African infrastructure projects, noting that Chinese corporations have undertaken extensive initiatives across the continent, including ports, railways, highways, bridges, and hydroelectric dams. These efforts have been largely driven by Beijing’s Belt and Road Initiative (BRI).

According to McKinsey, and highlighted in Rockwell’s report, there are more than 10,000 Chinese companies operating in Africa today. These companies have invested US$300 billion in the continent, employ millions of Africans, and have conducted more than US$2 trillion in business since 2005.

As the BRI continues to unfold in Africa, its progress is marked by a mixture of successes and challenges. Chinese investments and infrastructure projects have undeniably contributed to economic growth and job creation in various African countries. However, concerns about debt sustainability, environmental impacts, and transparency in project implementation have also been raised. African nations are navigating a delicate balance between reaping the benefits of Chinese investments and ensuring that these investments align with their long-term developmental goals.