China cancels DR Congo’s $2.4 billion debt amid COVID-19 crisis

A major producer of cobalt and copper, has attracted billions of dollars in investment from Chinese firms in recent years

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China cancels DR Congo's $2.4 billion debt amid COVID-19 crisis www.emergingbusinesslab.com

China has granted some debt relief to the Democratic Republic of the Congo (DRC) to help it overcome economic fallout from the coronavirus pandemic, the Congolese foreign ministry said on Wednesday.

As a result, the DRC will not have to repay its interest-free loans from China that matured at the end of 2020. The ministry did not say how much this amounted to.

China has extended debt relief worth over $2bn to developing countries under a Group of 20 (G20) framework aimed at giving those hammered by the COVID-19 crisis some financial breathing space.

The latest deal was announced at a joint press conference in Kinshasa with Chinese Foreign Minister Wang Yi.

“As Congo’s most reliable friend, China wishes to continue to make its contribution to Congo’s development,” Wang was quoted as saying in the Congolese ministry’s statement.

According to data gathered by Johns Hopkins University’s China Africa Research Initiative, Chinese entities have extended 53 loans to the Democratic Republic of the Congo between 2000 and 2018, amounting to a total of $2.4bn. Most of the lending was focused on the power, transport, and mining sectors.

The major cobalt and copper producer has attracted billions of dollars in investment from Chinese miners in recent years.

Congo’s exports to China surged 30 percent in 2020 compared with the previous year.

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