The total debt of the African continent is estimated at about 365 billion dollars, one third of which belongs to China, and in light of the desire of the major countries to help the countries of the continent overcome their deep economic problems, China is accused of not cooperating enough to reschedule the debts of African countries, and of seeking to draw them into more loans.
In an article in the French newspaper "Le Figaro", writer Virginie Mangin said that China - the major creditor to the countries of the African continent - found itself forced to temporarily suspend the debts of the countries of the continent due to the global economic crisis, but it does not intend at all to cancel any of those debts, as she put it.
Beijing agreed with reservation to the agreement reached by the Group of Twenty last April, which provides for the suspension of the debts of the poorest countries until the end of this year, while negotiations continue to extend the agreement for an additional year.
The G20 agreement does not include all African countries, as countries that have obtained loans from the World Bank or the International Monetary Fund are excluded, and the agreement also excludes commercial loans that African countries obtained from investment banks, such as the Export-Import Bank in the United States and the Chinese Development Bank.
And does not include the delay - which African countries consider insufficient - only a small part of the total debt of the continent, according to the French newspaper.
According to Johns Hopkins University, China loaned African countries 143 billion dollars between 2000 and 2017 to build roads, bridges, stadiums and hospitals as part of what is known as the "New Silk Road Initiative."
According to estimates by the London-based External Development Institute, Chinese loans represent 70% of Djibouti's foreign debt, as stated in the Le Figaro report.
International pressure
Writer Virginie Mangin stated that international pressure is being exerted on China at the present time to enter into an agreement to reschedule the debts of African countries, at a time when it is accused of seeking to implicate the African continent in more debts.
The author quotes Valerie Nikki, head of the Asia division at the Strategic Research Foundation in France, as saying that "a viable solution to African debts necessarily includes China's involvement in a multilateral process. Therefore, Beijing finds itself under great pressure to cooperate with other countries."
dilemma
According to the author, China does not intend to find an international solution to the debt problem of African countries, because that means more oversight and transparency that conflicts with their interests.
She says that Beijing does not show much cooperation with the "Paris Club", which currently includes 22 creditor countries, and aims to ease conditions for granting loans to African countries.
The Center for Global Development revealed that "the interest rates imposed by Chinese banks are two times higher than the interest rates imposed by the World Bank."
The writer expects that Beijing will continue negotiating with each country separately, without there being clear standards, and without thinking about completely canceling some debts, as many African countries demand.
However, Chinese President Xi Jinping said last June that his country intends to cancel the debts of the African countries concerned in the form of government loans exempt from interest due to be paid by the end of 2020.
In a speech at the China-Africa Extraordinary Summit on Solidarity in Confronting the Novel Coronavirus (Covid-19), Xi said that his country looks forward to the international community - especially developed countries and multilateral financial institutions - to play a more active role in easing and suspending debt burdens with regard to debt relief. To Africa, according to the official Xinhua news agency.
Last July, G20 officials refrained from issuing a recommendation to extend the debt freeze, and the group’s final statement at the time only referred to discussing the issue of extending the payment freeze for another year, in the second half of this year.
The statement also did not address the growing calls to cancel the debts of some of the poorest countries and not content themselves with postponing it.
The initiative - which was approved by the ministers of the group countries last April - showed difficulty in implementing it after only 42 out of 73 countries expressed their interest to save only 5.3 billion dollars from debt service payments instead of 12 billion that was pledged at the beginning.