China says it is ready to help Kenya with debt
Mon, January 18, 2021
China stands ready to help Kenya deal with its debt challenges, it's embassy in Nairobi said on Monday (January 18) adding that both sides are holding "smooth" talks over the issues.
Beijing is one of Kenya's biggest external creditors, having lent billions of dollars for the construction of rail lines and other infrastructure projects in the past decade.
But after months of lockdown measures, the East African country's revenues have been pummeled, its debts are falling due and it is grappling with gaping fiscal deficits.
In a statement the embassy in Nairobi said China attaches "great importance" to debt suspension and alleviation in African countries, including Kenya.
The embassy said China has signed debt service suspension agreements with 12 African countries and provided waivers of matured interest-free loans for 15 under the G20 Debt Service Suspension Initiative.
That scheme allows the world's poorer countries to defer official bilateral payments through to the end of June but last week World Bank President David Malpass, speaking at the Reuters Next conference, expressed frustration at a lack of private sector support for the initiative at a time when many countries are grappling with economic and health crises.
"Looking at it from the standpoint of the private sector, they say a contract is a contract. But I guess I would push back and say throughout history there have been occasions where there needs to be deep debt reduction and this clearly is one of those occasions. So I'm, I'm, I urge the private sector to take a look country by country at the over-indebtedness and look for ways to share the burden with the official bilateral creditors."
The Chinese embassy did not say whether Kenya will get relief through the same G20 initiative or a separate deal.
Last week Kenya secured a debt repayment relief deal with the Paris Club of international lenders and is seeking further relief from other bilateral creditors.
Video Transcript
- China stands ready to help Kenya deal with its debt challenges, its embassy in Nairobi said on Monday. Adding that both sides are holding smooth talks over the issues. Beijing is one of Kenya's biggest external creditors, having lent billions of dollars for the construction of rail lines and other infrastructure projects in the past decade. But after months of lockdown measures, the East African country's revenues have been pummeled. Its debts are falling due and it's grappling with gaping fiscal deficits.
In a statement, the embassy in Nairobi said China attaches great importance to debt suspension and alleviation in African countries, including Kenya. The embassy said China had signed debt service suspension agreements with 12 African countries and provided waivers of matured interest-free loans for 15 under the G20 Debt Service Suspension Initiative. That scheme allows the world's poorer countries to defer official bilateral payments through to the end of June. But last week, World Bank President David Malpass, speaking at the Reuters Next conference, expressed frustration at a lack of support for the initiative from the private sector, at a time when many countries are grappling with economic and health crises.
DAVID MALPASS: Looking at it from the standpoint of the private sector, they say a contract's a contract. But I guess I would push back and say throughout history, there have been occasions where there needs to be deep debt reduction and this clearly is one of those occasions. So I urge the private sector to take a look country by country at the over-indebtedness and look for ways to share the burden with the official bilateral creditors.
- The Chinese embassy did not say whether Kenya will get relief through the same G20 initiative or a separate deal. Last week, Kenya secured a debt repayment relief deal with the Paris Club of international lenders and is seeking further relief from other bilateral creditors.
China stands ready to help Kenya deal with its debt challenges, it's embassy in Nairobi said on Monday (January 18) adding that both sides are holding "smooth" talks over the issues.
Beijing is one of Kenya's biggest external creditors, having lent billions of dollars for the construction of rail lines and other infrastructure projects in the past decade.
But after months of lockdown measures, the East African country's revenues have been pummeled, its debts are falling due and it is grappling with gaping fiscal deficits.
In a statement the embassy in Nairobi said China attaches "great importance" to debt suspension and alleviation in African countries, including Kenya.
The embassy said China has signed debt service suspension agreements with 12 African countries and provided waivers of matured interest-free loans for 15 under the G20 Debt Service Suspension Initiative.
That scheme allows the world's poorer countries to defer official bilateral payments through to the end of June but last week World Bank President David Malpass, speaking at the Reuters Next conference, expressed frustration at a lack of private sector support for the initiative at a time when many countries are grappling with economic and health crises.
"Looking at it from the standpoint of the private sector, they say a contract is a contract. But I guess I would push back and say throughout history there have been occasions where there needs to be deep debt reduction and this clearly is one of those occasions. So I'm, I'm, I urge the private sector to take a look country by country at the over-indebtedness and look for ways to share the burden with the official bilateral creditors."
The Chinese embassy did not say whether Kenya will get relief through the same G20 initiative or a separate deal.
Last week Kenya secured a debt repayment relief deal with the Paris Club of international lenders and is seeking further relief from other bilateral creditors.
Video Transcript
- China stands ready to help Kenya deal with its debt challenges, its embassy in Nairobi said on Monday. Adding that both sides are holding smooth talks over the issues. Beijing is one of Kenya's biggest external creditors, having lent billions of dollars for the construction of rail lines and other infrastructure projects in the past decade. But after months of lockdown measures, the East African country's revenues have been pummeled. Its debts are falling due and it's grappling with gaping fiscal deficits.
In a statement, the embassy in Nairobi said China attaches great importance to debt suspension and alleviation in African countries, including Kenya. The embassy said China had signed debt service suspension agreements with 12 African countries and provided waivers of matured interest-free loans for 15 under the G20 Debt Service Suspension Initiative. That scheme allows the world's poorer countries to defer official bilateral payments through to the end of June. But last week, World Bank President David Malpass, speaking at the Reuters Next conference, expressed frustration at a lack of support for the initiative from the private sector, at a time when many countries are grappling with economic and health crises.
DAVID MALPASS: Looking at it from the standpoint of the private sector, they say a contract's a contract. But I guess I would push back and say throughout history, there have been occasions where there needs to be deep debt reduction and this clearly is one of those occasions. So I urge the private sector to take a look country by country at the over-indebtedness and look for ways to share the burden with the official bilateral creditors.
- The Chinese embassy did not say whether Kenya will get relief through the same G20 initiative or a separate deal. Last week, Kenya secured a debt repayment relief deal with the Paris Club of international lenders and is seeking further relief from other bilateral creditors.
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