Middle East

China denies allegations that Africa is in debt

Beijing rejected accusations that its lending system had driven African nations into debt traps, saying the “story” was being pushed by rivals with “back motivations.”

According to official figures, trade volume between China and Africa in 2019 was over $ 200 billion. (AFP)

China’s Foreign Minister Wang Yi rejected allegations that Beijing had fallen into a debt trap by providing huge loans to African countries, dismissing the idea of ​​a “story” that opposition had imposed on poverty reduction. did.

Wang said China’s large lending to Africa is “mutually beneficial” and a strategy to elicit diplomatic and commercial concessions before touring Beijing-funded infrastructure projects in Kenya on Thursday. He said it wasn’t.

“That’s not just the case, it’s speculation that some people are acting with ulterior motives,” he told reporters in the port city of Mombasa, Kenya.

“This is a story created by people who don’t want to see the development of Africa. If there is a trap, it’s about poverty and underdevelopment,” he said through an interpreter.

The three-country tour of King Eritrea, Kenya and Comoros aims to counter the growing influence of China on the continent, following a trip to Africa by US Secretary of State Antony Blinken in November.

According to official Chinese statistics, China is Africa’s largest trading partner, with over $ 200 billion in direct trade in 2019.

Financing costly projects

China is Kenya’s second-largest lender after the World Bank and has funded many costly infrastructure projects that have raised concerns about Nairobi taking on too much debt.

In Mombasa, the Wang held a private meeting with a team of government ministers to sign agreements on trade and investment, health, security, climate change and green technology transfer.

He later met President Uhuru Kenyatta and visited the port of Mombasa. There, China is building a new $ 353 million terminal to allow larger oil tankers to berth.

“This visit is a testament to the deepening of relations between the two countries,” said Kenya Foreign Minister Raychelle Omamo.

Beijing has funded Kenya’s most expensive infrastructure project since independence and has financed $ 5 billion to build a railroad from Mombasa, which opened in 2017.

High interest repayment

When visiting Mombasa in January 2020, Wang described the railroad as the “benchmark” of China’s Belt and Road Initiative. This is a $ 1 trillion driving force for improving trade links around the world by building groundbreaking infrastructure.

However, observers have raised a red flag about Kenya’s reliance on China’s funding, warning that debt has skyrocketed to unmanageable levels.

Kenya’s geopolitical and economic analyst Aly-Khan Satchu said East African countries are at a disadvantage in negotiations and often stick to high-interest repayments.

“These investments will not pay off foreseeable future investments,” he said.

“You are borrowing these loans and making monthly losses. You are essentially increasing the problem.”

The United States is promoting with “mutual respect”

State Department spokesman Ned Price was asked about Mr. Wang’s trip, and the United States is working on “sustainable and transparent cooperation” with Africans, asking countries to choose between the United States and China. He said he didn’t ask.

“The types of partnerships the United States offers to African countries-these are partnerships based on mutual opportunities and mutual respect,” Price said.

Beijing’s lending has slowed in recent years as borrowers have pushed back conditions and the coronavirus pandemic has caused financial distress.

Mr Thatch said China is shifting its focus from infrastructure to trade expansion and is expected to deepen its ties with the Indian Ocean economy.

“Chinese are trying to readjust their relations with Africa with a focus on agriculture and private sector lending,” he said.

The king has already visited Eritrea, and after Kenya, heads to Comoros, an island nation in the Indian Ocean.

Source: AFP

https://www.trtworld.com/africa/china-denies-claims-of-trapping-africa-countries-in-debt-53393?utm_source=other&utm_medium=rss China denies allegations that Africa is in debt

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