BEIJING – China’s Foreign Minister Qin Gang rejected accusations that the money his country lends to Africa is a “debt trap” on his first official trip since he was appointed in December.
Mr Qin’s comments were a swipe at statements that US officials have made repeatedly, criticising China’s perceived lack of transparency regarding loans it or its companies have made to African nations.
US Treasury Secretary Janet Yellen has said that China is the biggest obstacle to progress in resolving debt crises.
“China’s contribution is concrete in bettering the lives of African people,” Mr Qin said on Wednesday through an interpreter in a speech in Ethiopia, where the African Union is headquartered.
“We don’t accept the unreasonable label of debt trap,” he said.
China accounts for about 12 per cent of Africa’s external debt of around US$700 billion (S$931 billion), with Zambia and Ghana, both of which have defaulted on their debt obligations, among its biggest creditors on the continent, according to London-based international affairs policy institute Chatham House.
Still, China’s lending has funded an infrastructure boom in many African nations.
Mr Qin, citing World Bank data, said that multilateral lenders account for three-quarters of Africa’s external debt and should play a bigger role in resolving payment issues.
Sub-Saharan Africa’s external debt-servicing costs will likely rise 50 per cent by 2026 from 2019 levels and as many as 18 of the continent’s 54 nations will struggle to pay what they owe, according to the Paris-based Finance for Development Lab.
During the visit, Mr Qin signed an agreement to partially forgive Ethiopia’s debt to China, according to the African country’s state broadcaster, which did not say how much debt would be cancelled.
In 2020, Ethiopia owed China about US$13.7 billion, according to Chatham.
Mr Qin also called for better relations between the United States and China, the world’s two biggest economies and dominant political powers, saying that the nations should cooperate and co-exist peacefully rather than compete.
“No country, no people have the right to force the African countries and people to take sides,” he said.
“Africa should be a big stage for international cooperation, not an arena for major countries’ competition.”
Mr Qin is also visiting Gabon, Angola, Benin and Egypt on his trip. BLOOMBERG
