Now the largest bilateral official lender to countries in the region, China’s share of total sub-Saharan African external public debt rose from less than 2 percent before 2005 to about 17 percent of $790 billion in 2021, the IMF noted in its Regional Economic Outlook for Africa report, which was published in early October.<\/p>\n
Chinese lending appears to be more modest in proportion when these countries’ domestic debts are taken into account. Its share in the region’s overall sovereign debt was less than 6 percent in 2021, according to the IMF.<\/p>\n
The IMF report seems to have refuted Western allegations that increased Chinese loans to Africa are the main cause for some countries’ debt distress, a rebuttal that’s aligned with comments by African government officials and other debt assessments.<\/p>\n
“China only holds 21 percent of Kenya’s public external debt, with private creditors holding another 24 percent and multilateral institutions 45 percent,” said a Briefing Paper titled “Integrating China into Multilateral Debt Relief: Progress and Problems in the G20 Debt Service Suspension Initiative,” released by the Johns Hopkins University in April.<\/p>\n
In the case of Zambia, a majority of debts are owed to Western donors, multilateral institutions and bilateral ones, said Chibeza Mfuni, deputy secretary general of the Zambia-China Friendship Association.<\/p>\n
“I think we must be factual. The interest rates from Western lenders are higher … Countries have been stuck paying the interest, and the principal remains unpaid for a long time. What does that represent? It represents the rate of exploitation,” said Mfuni, former deputy head of the Zambian mission in Beijing.<\/p>\n
China has provided African countries with a new source of funding for infrastructure through the Belt and Road Initiative, while the country’s Foreign Direct Investment (FDI) to sub-Saharan Africa has also grown significantly since 2006, reaching about 23 percent of annual FDI inflows – or about $3 billion – to the region in 2021, said the IMF in its report.<\/p>\n","protected":false},"excerpt":{"rendered":"
China isn’t the primary factor behind the debt challenges faced by countries in sub-Saharan Africa, even though its lending to the continent has witnessed substantial growth over the past two decades, the International Monetary Fund (IMF) said in a recent report.<\/p>\n","protected":false},"author":12963,"featured_media":34702,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16,15],"tags":[7,26,25],"class_list":{"0":"post-34705","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-news","8":"category-politics","9":"tag-apie-project","10":"tag-news","11":"tag-politics"},"yoast_head":"\n