How much debt will China cancel with its write-off plan for interest-free loans in Africa?
- Beijing announced it would waive 23 interest-free loans maturing by late 2021 for Africa but did not give details of countries or the amount waived
- Researchers estimate that Beijing’s latest round of debt forgiveness will only cover a tiny portion of its lending to the continent
China may have cancelled between US$45 million and US$610 million in debt when it announced a plan to waive 23 interest-free loans maturing by the end of 2021 for 17 African countries, new research shows.
In a study released on Monday, Boston University’s Global Development Policy Centre reported it had compiled a database containing 212 interest-free loans totalling US$2.22 billion between 2000 and 2020 in 38 African countries.
The study noted that of the US$159.98 billion China had advanced to African countries in the past two decades, interest-free loans accounted for only 1 per cent.
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Authors Jyhjong Hwang, a research fellow, and Oyintarelado Moses, a data analyst and database manager, both at the Boston University centre, estimated that Beijing’s latest round of debt forgiveness would only cover a tiny portion of its lending to the continent.