August 28, 2018 / 9:11 AM / 21 days ago

China says projects not to blame for majority of Africa debt

BEIJING (Reuters) - Chinese development projects do not account for a majority of the debt on African countries, a senior Chinese official said on Tuesday ahead of a summit with African leaders in Beijing next week.

Workers put up an installation next to the headquarters of Bank of China in preparation for the Forum on China-Africa Cooperation (FOCAC), in Beijing, China August 24, 2018. REUTERS/Stringer

China’s “Belt and Road” initiative has been praised by supporters for providing vital financing to infrastructure-starved countries. Critics, including the United States, say the program is overloading poor nations with debt.

Asked about the debt issue at a news briefing on Tuesday, China’s vice commerce minister Qian Keming said Africa’s debt problems are long-standing and not entirely due to China.

He said debt burdens had been made worse by the global financial crisis and a slump in commodity prices.

“When it comes to the debt problem, there really is not that much Chinese debt in Africa,” Qian said.

“Overall, according to the statistics that I have, the majority of the debt burden is not necessarily created by China,” he added, without giving details.

His comments echoed remarks by a senior official at China’s state planning commission on Monday, who said loans provided under the Belt and Road initiative were not a “debt trap”.

Beijing will host some 30 African leaders at the Sept 3-4 China-African Forum on Cooperation summit, a once-every-three-years event that typically sees China dole out large loan packages for the continent.

China in the past three years has invested about $3 billion annually in Africa, according to the Commerce Ministry.

“China will be unwavering in supporting Africa’s development, including by providing funds, and at the same time we must focus funds on projects that are more sustainable, can advance economic growth, create employment and are economically effective,” Qian said.

Africa is an important part of Chinese President Xi Jinping’s “Belt and Road” initiative, a plan to bolster a network of infrastructure connecting China by land and sea to Southeast Asia, Central Asia, the Middle East, Europe and Africa.

China has pledged $126 billion for the plan.

Reporting by Christian Shepherd; Editing by Darren Schuettler

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