China helps Africa substantially with debt cancellation, restructuring: report

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A RECENT research from a China-Africa workshop in Johns Hopkins University (JHU) in the US suggests that China has played a significant role in helping African countries manage their debts.

With the coronavirus crisis exacerbating economic crisis in Africa’s low-income countries, economists and other experts argue that debt relief is essential, a Washington Post analysis said on February 26.

Chinese banks have offered African countries ‘significant’ debt restructuring before the pandemic and continued to do so, the post said, citing a working paper published by the China-Africa Research Initiative at the JHU’s School of Advanced International Studies.

The researchers have documented 16 cases of debt restructuring worth $7.5bn in 10 African countries between 2000 and 2019, and found that China wrote off the accumulated arrears of at least 94 interest-free loans amounting to over $3.4bn.

They also noted that Chinese lenders have not pursued lawsuits in cases of debt default or practiced asset seizures.

African nations may see faster debt relief from China than the West, and bondholders and private Western creditors have yet to join the debt relief efforts of the Group of 20, according to the analysis.

 

 

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