China to cancel interest-free loans to African Nations

China is to cancel interest-free loans that were due to mature at the end of the year, President Xi Jinping has announced at the China Africa Summit on Wednesday.

Speaking via video link, President Xi Jinping said that African nations most affected by the coronavirus would be granted an extended period of debt suspension, along with granting additional loans “to help them tide over the current difficulty”.

China’s president was keen to highlight the importance of Chinese-African collaboration in defeating the coronavirus. He said that the East would be a close ally of Africa through the sharing of scientific resources and accelerating the construction of “China-Africa Friendship Hospitals”.

President Xi Jinping has also promised that African nations will be the first to benefit from a Chinese developed vaccine. This comes after UK pharmaceutical researchers found this week that Dexamethasone (a cheap, widely available Steroid drug) can reduce the risk of death for critically ill patients of Covid-19 by a third. In the race between China and the West to show themselves as leading the research efforts, the West has leaped ahead.

China is eager to show itself as a pioneer in the defeat against the coronavirus, particularly in Africa. The last decade of Chinese investment and the development of the Belt and Road initiative has turned the African continent into a major trading partner. For the continent’s economic growth to be thwarted by a disease sourced in China would be a severe blow to the Chinese African union.

In his address to the Summit, President Xi Jinping pointedly called for African nations to “strengthen Belt and Road cooperation and accelerate the follow-ups to the FOCAC Beijing Summit”. Clearly, the outbreak of coronavirus in Africa is another opportunity to strengthen the financial bonds between the two under the guise of Chinese-provided healthcare.

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