• Sat. May 14th, 2022

Africa set to get debt relief from China

ByTina R. Wimmer

Mar 11, 2021

By AGGREY MUTAMBO

Chinese President Xi Jinping has pledged to cancel interest-free debt owed by “concerned” African countries as part of Beijing’s move to help the continent during the Covid-19 pandemic.

In a speech to a group of African leaders on Wednesday, Xi said he will work with other international lenders to protect African countries hardest hit by the novel coronavirus to help them emerge from the crisis.

Xi addressed African leaders directly via video link for the first time since the virus emerged.

“Under the framework of FOCAC (Forum on China-Africa Cooperation), China will cancel the debt of relevant African countries in the form of interest-free government loans that are due to mature by the end of 2020,” Xi said. to his audience, among others. to them the South African President Cyril Ramaphosa, the Kenyan Uhuru Kenyatta and the Senegalese Macky Sall, as well as the Ethiopian Prime Minister Abiy Ahmed. Leaders have spoken out to seek easier debt terms amid the pandemic.

“For the African countries hardest hit by the coronavirus and under severe financial pressure, China will work with the global community to provide them with greater support, such as by further extending the debt suspension period, for the help overcome the current difficulty,” he added.

China is now Africa’s largest creditor and owes the continent some $145 billion, including some $5 billion to Kenya.

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But just under 20% of these loans are interest-free, indicating that forgiveness may not be enough.