China has canceled and restructured some debt, but not paying back Africa’s debt with their dollar reserves yet. From 2000-2019, China has canceled $3.4 billion of Africa’s debt. China has also waived 23 interest-free loans in 19 African countries in 2022. For reference, Russia canceled $23 billion of Africa’s debt in 2022 alone.
Ultimately, Africa’s debt problem does not stem from China, who only provides a small portion of its total debt (most of which are owed to Western countries), though China lending Africa in dollar is a problem because it further entrenches the need of these countries to earn dollars to pay back their creditors. China has restructured some debt through IMF’s Special Drawing Rights (SDR), but that’s going through the IMF.
The total amount of Africa’s foreign debt is about $800 billion. China’s foreign reserve is also about $800 billion. China can do a lot to save and relieve those countries if it really wants to.
is there some truth to his or is it another fabrication from western media?
The impression came from the countries who dealt with China themselves. It depends on the Chinese banks who made the loans. There is a lot of exaggeration from Western propaganda, like China is setting a debt trap in Africa, which is false. If anything, China lending those countries with its dollars actually help entrench Western debt trap, not China’s!
What we want to see is instead of lending out its foreign reserves as loans to Africa, China should use those reserves to pay back Africa’s dollar debt, then lend out its infrastructure loans in yuan (or BRICS currency or whatever, as long as it’s not dollars) to fund clean energy and development projects.
The problem for China is that they don’t know what to do with all the dollars they have accumulated from exporting their goods to the US, since they are practically junk papers, so instead of buying US treasury bonds, they lend them out to developing countries via Belt and Road to help develop those countries. But it also entrenches those countries to further debt bondage, not to China, but to the US since these countries now have to earn dollars to repay these loans. Restructuring those loans into yuan and then canceling the debt altogether is the only way to go.
China has canceled and restructured some debt, but not paying back Africa’s debt with their dollar reserves yet. From 2000-2019, China has canceled $3.4 billion of Africa’s debt. China has also waived 23 interest-free loans in 19 African countries in 2022. For reference, Russia canceled $23 billion of Africa’s debt in 2022 alone.
Ultimately, Africa’s debt problem does not stem from China, who only provides a small portion of its total debt (most of which are owed to Western countries), though China lending Africa in dollar is a problem because it further entrenches the need of these countries to earn dollars to pay back their creditors. China has restructured some debt through IMF’s Special Drawing Rights (SDR), but that’s going through the IMF.
The total amount of Africa’s foreign debt is about $800 billion. China’s foreign reserve is also about $800 billion. China can do a lot to save and relieve those countries if it really wants to.
The impression came from the countries who dealt with China themselves. It depends on the Chinese banks who made the loans. There is a lot of exaggeration from Western propaganda, like China is setting a debt trap in Africa, which is false. If anything, China lending those countries with its dollars actually help entrench Western debt trap, not China’s!
What we want to see is instead of lending out its foreign reserves as loans to Africa, China should use those reserves to pay back Africa’s dollar debt, then lend out its infrastructure loans in yuan (or BRICS currency or whatever, as long as it’s not dollars) to fund clean energy and development projects.
The problem for China is that they don’t know what to do with all the dollars they have accumulated from exporting their goods to the US, since they are practically junk papers, so instead of buying US treasury bonds, they lend them out to developing countries via Belt and Road to help develop those countries. But it also entrenches those countries to further debt bondage, not to China, but to the US since these countries now have to earn dollars to repay these loans. Restructuring those loans into yuan and then canceling the debt altogether is the only way to go.
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