President Xi Jinping’s decision to host the state visits of Zambian President Hakainde Hichilema and Venezuelan President Nicolás Maduro in China this weekend sends a significant message about China’s evolving diplomatic strategy. By bypassing the G20 summit and receiving world leaders on home soil, President Xi underscores China’s preference for conducting diplomacy through avenues where Beijing holds greater influence, such as the expanded BRICS.
Both Zambia and Venezuela have sought economic relief from China in recent years, grappling with substantial levels of debt, a significant portion of which is owed to Beijing. Concurrently, President Joe Biden plans to advocate for debt relief for developing countries and unveil funding for infrastructure projects during the G20 summit.
Although neither Zambia nor Venezuela is a member of the G20, Bloomberg News reported that the group has agreed to grant the African Union permanent membership. This development offers Zambia an opportunity for future participation in G20 summits, reflecting their crucial role in global debt discussions.
Nicolás Maduro’s visit to China coincides with efforts to re-establish ties between the two nations after a period of cooling relations. Against the backdrop of intensifying rivalry between the United States and China, a meeting between President Xi and Maduro holds significance as it will mark the first encounter between the two leaders in five years.
China has been a vital lender to Venezuela since 2007, providing funds for infrastructure and oil projects. Presently, the Maduro government aims to secure additional finances from Venezuela’s substantial oil wealth ahead of his expected bid for a third presidential term. In parallel, the Biden administration seeks to engage with Venezuelan officials, discussing the lifting of sanctions in exchange for fair elections in 2022.
China’s position on debt restructuring has become increasingly crucial, especially considering its role as the largest creditor for many impoverished nations. Zambia became the first country to obtain significant debt relief through the Common Framework earlier this year. China played a central role in structuring a deal to restructure $6.3 billion in bilateral debt, establishing a template for coordination between the Chinese government, the Paris Club, and bondholders.
The growing global importance of Zambia, fueled by its vast deposits of critical minerals for the energy transition, has positioned the country as a battleground for influence between China and Western nations. Notably, China’s Zijin Mining Group Co. is bidding to acquire a stake in Zambia’s Mopani Copper Mines, previously owned by Glencore Plc. Furthermore, President Hichilema, who is on his inaugural trip to China, may focus on discussions regarding the revival of the Tanzania-Zambia railway line, an essential transportation route for the region’s copper mining industry.
As President Xi welcomes world leaders in China, Premier Li Qiang will represent the country at the G20 summit in New Delhi. President Biden, meanwhile, is scheduled to hold a bilateral meeting with Indian Prime Minister Narendra Modi. President Xi’s upcoming major international event will be the third Belt and Road Initiative forum in Beijing next month, where over 90 countries have confirmed their attendance. Thus far, Russian President Vladimir Putin is the sole world leader confirmed to participate in the event, which marks his first foreign trip since an arrest warrant was issued by the International Criminal Court accusing him of war crimes.
As China broadens its diplomatic footprint, hosting world leaders and engaging in strategic partnerships, the nation demonstrates its evolving role on the global stage. President Xi’s preference for diplomatic engagements on home soil and within frameworks where China holds influence underscores the country’s commitment to shaping global economic and geopolitical dynamics.
Market Capital Research 