Belt & Road: China's grip on central Africa tightens
Public debt in half of the countries in sub-Saharan Africa has climbed above 50 percent. The risk of a crisis is growing. Consider Zambia. In 2005 Zambia had its debt wiped clean under the International Monetary Fund (IMF)’s ‘heavily indebted poor countries’ (HIPC) scheme. Slightly over a decade later, the country has debt worth 59 percent of its GDP – nearly one-third of which is held by China. The government blames a fall in commodity prices since 2011. But the real reason for Zambia’s debt troubles is significant fiscal mismanagement by the ruling Patriotic Front.
Amidst rumors of a new Chinese loan, with Zambia’s national electricity supplier, Zesco, as a guarantee, Aleksandra joins Monocle24’s Emma Nelson to explore China’s overseas ‘debt diplomacy’ and African debt. Her segment begins around minute :25.