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17 June 2013, Gateway House

Badi Soch: The dragon must choose

This daily column includes Gateway House’s Badi Soch – big thought – of the day’s foreign policy events. Today’s focus is on Chinese investment in the disputed Great Renaissance Dam.

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The Chinese policy of non-interference in the politics of another country and the politics of its investment in Africa are on a collision course. Egypt and Ethiopia are at loggerheads over the $4.7bn Great Renaissance Dam — reportedly financed to the tune of $1.8 billion by Chinese banks — planned across the Nile on the latter’s border with Sudan. With $560 million invested in Egypt and $450 million in Ethiopia, China can no longer continue to be low key, because the host governments will demand positions on their disputes.

The economic superpower must now either pick sides and cut its rather expensive losses or begin to ‘interfere’ and broker a deal between the Egyptians and Ethiopians. This will be a complication, but not a deal-stopper especially at the start of this ambitious project. However, there could be far-reaching consequences for China’s future role in the politics of African countries, nearly 50 of which are invested in by around 2,000 Chinese companies.

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