Top 10 African Countries Receiving most loans from China

According to the International Monetary Fund (IMF), several highly indebted emerging countries have obtained significant loans from China. These loans are part of China’s broader investments in global infrastructure through the Belt and Road Initiative (BRI), also known as the New Silk Road. Launched in 2013, the BRI is an ambitious project to create an extensive network of railways, energy pipelines, highways, and streamlined border crossings.

Chinese state-owned creditors have rapidly increased the provision of foreign currency-denominated loans to resource-rich countries, particularly in Africa. Ethiopia has accumulated substantial external debt among these nations, reaching USD 28.2 billion. Between 2006 and 2022, Chinese lenders committed nearly USD 14 billion in loans to Ethiopia.

However, the economic effects of the COVID-19 pandemic, the war in Ukraine, and internal wars and conflicts have created challenges for many African countries in meeting their debt obligations. Presently, 22 low-income African nations are experiencing a debt crisis or face significant risks of entering one.

Chinese lenders account for 12 Pct of Africa’s total private and public external debt, which has increased more than fivefold to USD 696 billion between 2000 and 2020. While China remains a significant creditor to several African countries, its lending has declined recently and is expected to continue at lower levels.EBR

12th Year • December 16 2023 – January 15 2024 • No. 124

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