23 interest-free mature loans for 17 African nations are set to be forgiven by the Chinese government.
Chinese Foreign Minister Wang Yi revealed this during his speech at the recently held Forum on China-Africa Cooperation. He said the action shows China’s commitment to forging greater commercial connections with the African continent.
The foreign minister continued by saying that this shows how the Chinese government backs up its statements for the development of Africa with deeds.
Djibouti, Angola, the Democratic Republic of the Congo, Kenya, Uganda, and South Africa are among the African nations having substantial debt exposures to China, despite the fact that the 17 countries were not identified in the report.
A copy of Mr Yi’s address, also mentioned other specific ways China intends to support Africa going forward.
For one, China will continue to support the continent’s efforts to upgrade its infrastructure by providing financing and investment assistance under the Chinese government’s transcontinental Belt and Road Initiative.
China will also provide emergency food assistance to 17 African countries in need this year.
Part of the statement also said that China will expand its imports from Africa.
“We will also continue to increase imports from Africa, support the greater development of Africa’s agricultural and manufacturing sectors, and expand co-operation in emerging industries such as the digital economy, health, green and low-carbon sectors,” the statement said.
Finally, China said that it will redirect $10 billion of its Special Drawing Rights (SDR) to Africa through the International Monetary Fund in accordance with its commitment to development cooperation with African nations (IMF).
You may be aware that there is a common belief regarding China’s supposed debt traps in Africa. In a similar line, there is the myth that China is the source of debt for many African nations.
A recent report by Debt Justice, however, revealed that many African nations owe Western banks, oil dealers, and asset managers three times as much as they owe Chinese lenders.
The trend of blaming China for Africa’s financial woes is a simple diversion, the research further stated.