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Past Injustices, Present Dilemmas: The Reparations Tightrope

Image via The Economist

Discussions about historical injustices in South Africa often gravitate towards apartheid, the policy of rigid racial segregation that held sway from 1948 to 1994. While this focus is historically warranted, it often overlooks the extensive land dispossession, coercive labor, and cultural subjugation endured by the country’s First Nations groups.

On October 20, 2023, at Cape Town’s historic Slave Lodge—a living testament to the painful legacy of slavery in South Africa—Dutch King Willem-Alexander and Queen Maxima found themselves confronted by a passionate group of indigenous South Africans, shouting slogans “about Dutch colonizers stealing land from their ancestors.” Their demand? Reparations for the historical injustices committed by the Dutch Royal Family. However, the methods they suggested, such as Dutch contributions toward and involvement in development projects like hospitals [and] schools, raises critical questions about the thin line between well-intentioned reparations and neocolonialism in the 21st century.

In order to better understand the complex dynamics at play in South Africa, we can examine another instance of foreign investment that toes the line between aid and neocolonialism: The relationship between China and Zambia. The Zambia-China Economic and Trade Cooperation Zone (ZCCZ), established in 2011, was a venture marked with mutual advantages. It represented an opportunity for Zambia to “boost economic activity, create employment opportunities and secure financing for future infrastructure projects.” Meanwhile China could enlarge the market for Chinese goods and services and expand access to strategic natural resources, such as copper.

Through the ZCCZ, China has invested significantly in developing Zambia’s infrastructure, particularly in the construction of roads, bridges, and other key projects. While these investments have heavily contributed to Zambia’s economic growth, they have also introduced a core concern: Zambia accumulated substantial debt to China in order to fund these projects. In fact, “China is responsible for $5.94 billion of Zambia’s overall external debt,” which is around $16.76 billion.

The terms of Chinese loans to Zambia have been criticized for their potential to lead to a debt trap. That is, if Zambia struggles to repay its loans, it may be required to make concessions to China, such as by selling state-owned assets or granting further resource rights to Chinese interests. The trap may have already begun to spring: According to Africa Confidential, Zambia’s “state TV and radio news channel[,] ZNBC is already partly Chinese-owned.” Moreover, in 2018, the “state electricity company ZESCO [was] already in talks about a takeover by a Chinese company.” Had this takeover materialized, it would have handed China a substantial foothold within Zambia’s energy domain, potentially reshaping the nation’s power supply. 

If China had gained control over ZESCO, it could have influenced tariff structures and pricing for electricity. While Chinese ownership might have enabled affordable electricity for Zambia’s population, it more likely would have introduced pricing models that prioritized Chinese interests. China, which already owns Zambia’s debt, risks further undermining Zambia’s economic and political sovereignty, by potentially acquiring its state-owned assets.

One other noteworthy consequence of ZCCZ-related projects is a considerable influx of Chinese labor into Zambia. The projects, often large-scale infrastructure improvements, necessitate specialized machinery and advanced technology that may not be readily available locally. As a result, Chinese companies often bring their own equipment, along with the expertise to operate it. Moreover, relatively modest wages in Zambia correlate to a much higher value when converted to the Chinese yuan, meaning Chinese workers are often willing to work for lower wages than local workers. Consequently, demand for local workers, particularly in specialized roles, has substantially diminished, augmenting Zambian unemployment levels.

China’s extensive economic influence and investment practices in Zambia have raised concerns about the country acting as a neocolonist force. As defined by Britannica, neocolonialism is an “effort by… developed countries to block growth in developing countries and retain them as sources of cheap raw materials and… labor.” Both the United States [and] the International Monetary Fund (IMF) have expressed worry that the Belt and Road Initiative (BRI) “strategy is first to encourage indebtedness, and then to take over strategic national assets when debtors default on repayments.” The reasons for these concerns are glaringly apparent when assessing how much influence China wields over Zambia’s economy, resource management, labor dynamics, and debt landscape.

The dynamics of the Sino-Zambian relationship illustrate the potential peril that could emerge if the Netherlands were granted an avenue to re-enter South Africa. Much like the ZCCZ, the reestablishment of a Dutch presence in South Africa appears to be mutually beneficial for both countries: South Africa would receive reparations to address historical injustices stemming from its colonial past, while the Dutch would have the opportunity to recognize and apologize for their role in these injustices, thereby fostering reconciliation. 

However, South Africa already finds itself deeply entrenched in a $266.9 billion debt (mostly from investors, the World Bank, and the IMF), and Dutch involvement in development projects could open a pathway for the former colonizer to assume control over South African debt. Such a  scenario would set the stage for a potential chain reaction reminiscent of the power dynamics between China and Zambia, in which the Netherlands could amass considerable influence over South Africa’s economy, resources, and labor dynamics. 

The visit of King Willem and Queen Maxima to Cape Town’s Slave Lodge sparked a crucial conversation about reparations for historical injustices beyond Apartheid. While the demands of indigenous South Africans are valid, it is essential to approach the issue of reparations with caution. While reparations in the form of development projects may seem like a valiant effort to rectify past wrongs, they can inadvertently pave the way for neocolonialist behavior, echoing the very historical injustices they aim to rectify. There is a fine balance to be struck between addressing past wrongs and safeguarding economic sovereignty in the global context that exists today. The case of China’s involvement in Zambia serves as a stark reminder that the path to justice can be fraught with unintended consequences.