The Shadow of Sanctions
The threat of US sanctions now looms over influential figures in both Ethiopia and Kazakhstan, countries increasingly drawn into China’s orbit. In Kazakhstan, the focus is on Timur Kulibaev, a powerful oligarch and board member of Gazprom, long regarded as Beijing’s preferred gateway into the country. Reports suggest he has benefited extensively from Chinese-backed projects, including allegations—published by the Financial Times in December 2020—that tens of millions of dollars were siphoned from gas pipeline loans. Yet China’s indifference to such revelations points to a deeper, systemic culture of corruption.
While Western oil majors are scaling back their exposure, Beijing’s investments—over $27 billion, half in Kazakhstan’s oil and gas sector—continue to expand. Kulibaev, his protégés and associates may soon find themselves targeted by US lawmakers intent on checking China’s advance.
Ethiopia in the Dragon’s Shadow
If Kazakhstan highlights elite capture, Ethiopia illustrates China’s strategy of economic saturation. By June 2020, Chinese firms had sunk investments into more than 1,000 Ethiopian projects. Trade between the two nations has surged from just $100 million in 2002 to $3 billion by 2014. Yet the balance is heavily skewed: China exports nearly ten times more to Ethiopia than it imports, draining the African nation’s foreign exchange reserves.
In 2018, Ethiopia attempted to offset these losses by opening state-owned enterprises—telecoms, airlines, shipping, electricity—to private and foreign investment. But rather than diversify the investor base, these reforms allowed China to consolidate its dominance. In 2019 alone, Chinese companies signed 346 new contracts worth $2.7 billion.
Imported Labour, Exported Profits
Ethiopia hoped that Chinese projects would generate local employment. Instead, Beijing imported over 4,000 workers to join the 8,000 already in the country. For many Ethiopians, this has sharpened resentment, fuelling protests reminiscent of those in Pakistan’s Balochistan against the China–Pakistan Economic Corridor. In Tigray, attacks by the Tigray People’s Liberation Front (TPLF) have targeted Chinese-backed factories and industrial parks, underscoring the growing perception of China as an occupying force.
Control Through Infrastructure
China’s imprint on Ethiopia is near-total. From highways, railways and pipelines to hydropower and communications, Chinese firms dominate the infrastructure landscape. Their use of low-grade materials and imported designs has deepened Ethiopia’s dependence on Beijing for maintenance and repairs.
The Mekelle City water supply project is a case in point: China provided loans covering 85 per cent of costs, ensuring long-term leverage over critical utilities. Meanwhile, Beijing actively sought to stall or displace competing projects supported by the African Development Bank, Italy and France.
Security, Espionage and Surveillance
China’s reach extends beyond economics. Ethiopia is a discreet buyer of Chinese arms—from artillery and armoured vehicles to long-range missiles—while its officers receive training in China. Telecommunications projects, often executed by Huawei and ZTE, raise further alarm. Huawei, widely accused of acting as a conduit for Chinese state surveillance, built the African Union headquarters network in Addis Ababa, later discovered to be secretly transmitting data to Shanghai.
Across Africa, Chinese-built government buildings and telecom networks—190 and 14 respectively—embed vulnerabilities ripe for exploitation by Beijing’s intelligence apparatus.
Tourism or Trojan Horse?
China also projects influence through the movement of its people. More than 2.5 million Chinese nationals enter Ethiopia annually, ostensibly as tourists. Yet many pursue business expansion, embedding themselves in strategic sectors and extending Beijing’s grip.
A Familiar Pattern
Ethiopia is not alone. Across Africa, China replicates the same formula: debt-financed infrastructure, imported labour, technology with built-in dependencies, and elite capture through strategic loans. Kazakhstan’s energy sector shows how this model can also bind resource-rich states in Central Asia.
The Price of Dependency
Beijing’s defenders argue that such investments fill critical gaps left by Western disengagement. Yet the costs are mounting: loss of sovereignty, the hollowing of local industry, and the steady erosion of strategic independence. As Ethiopia’s MoU with China’s Belt and Road Initiative has shown, signing on to Beijing’s promises often means signing away autonomy.
Conclusion
Whether in Africa or Central Asia, China’s approach is consistent: strategic investment tied to control, influence anchored in debt, and sovereignty traded for short-term gain. For Ethiopia and Kazakhstan, the question is no longer whether the Dragon is advancing—but whether either nation can prevent being swallowed whole.