As insinuations mount that China is heaping Africa with debt, Dr. Akinwumi Adesina, President of the African Development Bank (AfDB), has denied the alleged debt crisis in African countries.
He spoke on the sidelines of the Forum on China-Africa Cooperation (FOCAC) Beijing Summit.
Western nations accused China of hoodwinking poor African nations into debt overload.
“Let me be very clear that Africa has absolutely no debt crisis,” Adesina told the press after a discussion at the High-level Dialogue Between Chinese and African Leaders and Business Representatives, which was closed Tuesday as part of the FOCAC Beijing Summit.
“African countries are desperate for infrastructure. The population is rising, urbanization is there, and fiscal space is very small,” the AfDB president said.
“They are taking on a lot more debt, but in the right way.”
Africa saw an overall debt-to-GDP ratio of 37 per cent last year, which, albeit up from 22 per cent in 2010, is within the reasonable range for low-income countries, Adesina said.
He stressed that the ratio is markedly lower than 100 per cent or 150 per cent of many higher-income countries and over 50 per cent of emerging economies.
For years, China has been providing money-starved African countries with loans that are urgently needed to build roads, power plants, and factories, as infrastructure is considered the precondition for African countries to propel industrialization and achieve prosperity.
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