Q: The latest report released by the China-Africa Research Initiative (CARI) at Johns Hopkins University says that the allegation that Africa could be overwhelmed by Chinese debt does not totally stand. What is your comment on that? China has provided a large amount of loans to Africa and other developing countries through foreign aid, how do you perceive such a matter as "debt trap"?
A: I am aware of that report. It says that many African countries have benefitted from the Chinese loans; the Chinese creditors are working hard to avoid the risks from the loans, and the Chinese loans are an important capital source for Africa's infrastructure construction. A cross-analysis on the lending rate made by the CARI shows that China is offering a lower lending rate to Africa. I also noted that some other publications such as The Atlantic have published reports on this subject and concluded the debt trap allegation is false.
Debt in developing countries has been a long-existing issue with complicated causes, which at its core is a matter of development. As the COVID-19 pandemic is raging around the world, the drastic fluctuation of commodity prices has aggravated their debt predicament. The ultimate solution to the debt issue for those countries is to help them enhance self reliance and realize sustainable development.
The Chinese government has always taken a highly responsible approach to the issue of debt when providing foreign aid. The so-called "debt trap" is utterly a false proposition fabricated by someone with ulterior motives. We pay high attention to the debt sustainability of the recipient countries. When providing interest-free loans and concessional loans, we always conduct strict economic and technological assessments over the projects and fully consider the debt situation and solvency of the recipient countries. No country has ever been trapped in debt because of Chinese loans. When the countries concerned have fiscal difficulties, we always seek proper solutions through friendly negotiations. China has never forced other countries for debt repayment, will not ask for any "bullying terms", and will never create any "debt trap".
As a matter of fact, multilateral financial institutions and commercial creditors hold the majority of the overall composition of developing countries' foreign debt. They shoulder greater responsibilities in helping those developing countries relieve their debt. We call on those institutions to make more efforts to alleviate the debt burden of developing countries.