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China calms anxiety of African continent

CHINA has diffused the growing tension on debttrap diplomacy over African countries, hinting that it does not support infrastructure projects in the continent to strategically advance its geostrategic interests.

Instead, the world’s second largest economy and Africa’s major trading partner affirmed that its financing to the continent is provided in a responsible manner, putting all associated risks under control.

In its efforts to help Africa contain debt risks, Assistant Minister of Foreign Affairs Chen Xiaodong said the country encourages its companies to directly invest in Africa and explore new models like Public Private Partnership (PPP).

Mr Xiaodong argued that African debt problem, to which China is mistakenly linked, is a result of multiple factors.

At the opening ceremony of the Seventh China-Africa Think Tanks Forum here,the assistant minister noted that the continent debt problem was a ‘growing pain’ that naturally emerges in the process of development and can only be eliminated in the course of further development.

“China is taking the initiative to align its development plan with those of African countries, helping them to build capacity for home-grown development and undertaking a large number of projects that will make a big difference to economies and lives in Africa,” he said.

The clarification comes amid growing concerns that the East Asian economic giant was funding flagship infrastructure projects in Africa, fuelling ‘debt-trap diplomacy’ that will eventually give Beijing leverage on gaining strategic and military power over the continent.

At the heart of the alleged debt-trap diplomacy, China is reportedly supporting infrastructure projects in strategically located developing countries by extending huge loans to the African governments.

As a result, some countries are becoming burdened with debts, leaving them even more susceptible to Chinese influence on their economy.

Tanzania is one of the African countries receiving loans from China, with the notable multi-billion shilling projects that have attracted loans from the Chinese government including the 532-kilometre Mtwara-Dar es Salaam gas pipeline.

President John Magufuli, in March this year, insisted that Tanzania will keep borrowing to finance mega infrastructure projects, dismissing claims that the national debt will soon become unmanageable.

He said the East African second largest economy still has room for further borrowing, arguing that what mattered were the projects into which the country invested the borrowed money.

Finance and Planning Minister Philip Mpango said in April that Tanzania national debt was well below the required international standards.

Taking the national debt against the GDP, the minister noted that it’s at 34.4 per cent, meaning that the country remains 22 per cent below the required international standards.

Chinese assistant foreign minister said his country understands the importance of debt sustainability in Africa and is helping the continent to improve its investment environment.

“China’s financing to Africa is provided in a responsible manner, the associated risks are generally under control. We empathise on the situation and try to help Africa contain debt risks and relieve the pressure of repayment,” he asserted.

He insisted that China’s cooperation with Africa will remain with no any political strings attached as the country respects the will and needs of African nations.

GOLD mining conglomerate Barrick ...

Author: DAILY NEWS Reporter in Beijing

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