Home Business & Economy Botswana says China agreed to extend loan, cancel debt

Botswana says China agreed to extend loan, cancel debt

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Botswana President Mokgweetsi Masisi

CHINA plans to extend a loan to Botswana for rail and road infrastructure as well as writing off some debt, Botswana’s President Mokgweetsi Masisi says.

Speaking at the airport on his return from last week’s China-Africa forum in Beijing, Masisi said Botswana had made a pitch to China and ‘I am happy to report that, judging from what President Xi Jinping told me, we were successful.’

In addition to the loan and a debt cancellation of P80m, China has also offered a P340m ($31 million) grant, he said.

‘We got a little bit more than just the loan,’ he told reporters.

He did not disclose the size of the loan, but last week the ministry of finance said Botswana was seeking a P12bn ($1.09bn) loan for transport infrastructure.

Botswana is the world’s leading producer of diamonds by value. Chinese companies, mostly state owned, are largely into construction in Botswana such as dams and roads.

The bulk of the loan is expected to fund the Mosetse-Kazungula railway line project, which will link the central part of Botswana to the tourism hub in the northwest.

The railway line will also promote regional trade as it will connect Botswana to Zambia via the Kazungula Bridge, currently under construction.

China’s Xi has offered another $60bn in financing for Africa and wrote off some debt for poorer African nations, while warning against funds going towards vanity projects’.

Speaking at the opening of the forum, Xi said the financing would include $15bn in aid, interest-free loans and concessional loans, a $20bn credit line, a $10bn special fund for China-Africa development, and a $5bn special fund for imports from Africa.

The Zambian government also on Saturday denied reports that it was in talks with Chinese companies for them to take over Kenneth Kaunda International Airport and the Zesco power utility due to debt default.

Government spokesperson Dora Siliya tweeted a denial. She pointed out that some of the China-funded projects had not even been completed.

 

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