China cites US debt issue to deflect pressure on Africa debt

The Chinese government says the United States should stop pressuring it on debt relief for Zambia and focus on averting a government default at home with possible repercussions for the global economy.

The Chinese embassy in Zambia responded Tuesday to remarks by US Treasury Secretary Janet Yellen, who said on a visit to the African nation this week that it’s crucial to address its heavy debt burden with China.

“The biggest contribution that the US can make to the debt issues outside the country is to … cope with its own debt problem and stop sabotaging other sovereign countries’ active efforts to solve their debt issues,” the Chinese Embassy said in a statement.

Chinese development banks have emerged as major lenders to poorer countries around the world for natural resource, transport and power projects, though that lending has fallen sharply and steadily since 2016, according to Boston University’s Global Development Policy Center.

New loan commitments dropped to eight projects totaling $3.7 billion in 2021, down from a peak of 151 projects and $80 billion in 2016, based on data compiled by the center.

Addressing Zambia’s debt was a major reason for Yellen’s visit and she said Monday that “it’s taken far too long already to resolve this matter.” The country failed to make a $42.5 million bond payment in November 2020, becoming Africa’s first coronavirus pandemic-era sovereign nation to default.

In responding to Yellen, China zeroed in on the battle between Republican lawmakers and the Democratic Biden administration over raising the US debt limit to allow more borrowing to keep the government running.

The embassy statement then turned to Zambia, saying that China has made some progress as co-chair of a creditors committee seeking a sustainable solution. It said China looks forward to the US playing a constructive role in the process.

“Even if the US one day solves its debt problem, it is not qualified to make groundless accusations against or press … other countries out of selfish interests,” the statement said. Source: alarabiya