Analysis | China’s influence in Ghana is more powerful than ever. What does this mean for the United States?
If the United States seeks to maintain its influence in Ghana, it must find new ways to stack up against China’s overwhelming presence in the nation.
Zaina Adamu
On May 17, the IMF Executive Board approved a $3 billion loan arrangement in Ghana, but it warned that should the country fail to honor its financial obligations, China would receive the power to take a portion of Ghana’s oil, cocoa, or bauxite to pay off the debt. Before the deal, Ghana remained at high risk of debt distress, and its cedi slumped to become one of the world’s worst-performing currencies. However, that has not stopped China from recognizing that the country — rich in natural resources — holds strategic importance and is a pivotal piece in its geopolitical game of chess.
With China devoted to pursuing a closer partnership with Ghana, the United States faces a quagmire. China, Russia, and other non-Western powers threaten the U.S. trade and investment relationship with the West African nation; and although the U.S.-Ghana relationship has been strong, Ghana has now become China’s largest trading partner in Africa. As a result, the United States can no longer take the relationship for granted and must now demonstrate how to make Ghana its partner of choice.
This challenge is a large reason why Vice President Kamala Harris visited the West African country in April to promote increased collaboration between the United States, Ghana, and the rest of sub-Saharan Africa. Her visit came on the heels of other high-profile visits, including U.S. Ambassador to the U.N. Linda Thomas-Greenfield’s visit to Ghana in August and Ghanaian President Nana Akufo-Addo’s trip to the U.S.–Africa Leaders Summit in Washington last December.
As Harris said in Accra, “The United States is committed to strengthening our partnerships across the continent of Africa — partnerships based on openness, inclusiveness, candor, shared interests, and mutual benefits.” Shortly thereafter, she announced a $1 billion initiative in public and private financing for programs focused on the economic empowerment of women.
Before Harris’s visit, U.S.-Ghana relations were already relatively strong, with both relying on the other for economic growth. According to the U.S. Embassy in Ghana, the United States is one of Ghana’s principal trading partners, with trade volume exceeding $1.2 billion. Compared to other African nations, Ghana’s considerable natural wealth in gold, cocoa, and oil makes the country a priority for U.S. policymakers.
But Ghana recognizes the preponderance of China and its influence within African markets. In 2019, Beijing financed $2 billion worth of rail, road, and bridge networks in exchange for access to 5 percent of Ghana’s bauxite reserves. A year before, the two countries signed eight cooperation agreements and memoranda of understanding in several sectors of their economies. Then, in 2021, Ghana became China’s largest trading partner in Africa after investment between the two nations increased by $15 million. As Chinese Ambassador to Ghana Lu Kun said, “These are not just numbers, but a symbol of the China-Ghana friendship we value and cherish.”
Close interactions between Ghana and China date back to 1960, when the countries first exchanged high-level official visits to cement diplomatic ties. It was the beginning of a strategic blueprint for future relations; Ghana offered natural resources to the Chinese, who reciprocated with material resources, including hydroelectric projects and high-speed broadband systems. Skeptics argue China’s current stronghold in Ghana is an example of “debt-trap diplomacy” that poses a catastrophic threat to the nation’s long-term economic growth. As it stands, Ghana’s debt to China exceeds $17 billion, putting it at the top of a recent list of countries at risk of default. But Ghana’s ability to repay loans in the future seems out of reach when the nation faces a likely economic cataclysm in several months. Moreover, Chinese lenders attract developing countries seeking loans that Western lenders would consider too risky, mostly because Chinese investors offer loans on less stringent terms.
Either way, the United States — historically known as Ghana’s leading source of trade and investment — now faces a strategic rivalry with China. To counter this, the United States must show that its relationship with Ghana and the rest of Africa is beyond politics. As American journalist Karen Attiah wrote in The Washington Post, “a long-standing complaint about U.S. policy relations in the past two decades has been that Washington has largely seen [Africa] not as a true partner, but as an arena full of threats to be contained.” President Joe Biden’s administration reinforced this trend when Harris announced in Ghana that the United States would pump $86 million into West Africa to address “security governance and development issues in the region.” To reverse this trend, the United States must capitalize on a key advantage it has over China: its global influence as a champion of democracy.
Much of the U.S.-Ghana relationship will depend on the success of the new U.S. Strategy to Prevent Conflict and Promote Stability, a multi-state partnership with Ghana and other members of Coastal West Africa, designed to build upon existing resiliencies, prevent instability, and end violent extremism. For the strategy to succeed, it would need to, at least annually, monitor, evaluate, and learn threat dynamics that cut across the region, and continuously improve upon challenges and limitations that would prevent stabilization of conflict areas across the region.
In addition, building a system that puts medium- and long-term growth at the forefront of Ghana’s development will be highly significant and would strengthen both economic and diplomatic relations. Yes, the United States has long supported and facilitated Ghana in mobilizing private capital to stimulate economic growth and job creation, but changes have remained too few and too slow.
Some say part of the U.S. fears of China’s presence in Ghana result from panic incited by the media and state actors. To remedy this, Ghana has work to do. The country must be careful not to direct all its focus on China, thus neglecting its relationship with the United States. Ghanaian policymakers must become more efficient in forming tactical and mutually beneficial partnerships to serve their own interests. Designing policies that include the provision of critical services in the digital, financial, business, and infrastructure industries would provide long-term benefits that post-modern Ghana will need to sustain growth.
Strong U.S.-Ghana relations could show other nations how to create authentic bilateral ties that build and strengthen constructive relationships with countries in the Global South. With other major powers competing for influence in Ghana, the United States can remain Ghana’s top partner of choice — but only if it strategizes about how to show that its value trumps the others.
Zaina Adamu is president of Harvard Alumni for Global Development.
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