Chinese government announces a forgiveness of 32 million euros of Mozambique’s debt to Beijing, to help the country fight Covid-19. Moreover, China will give an additional support of 19 million euros to Maputo.
The partial pardon results from an agreement signed last Friday (19.03) in Maputo by China’s ambassador to Mozambique, Wang Hejum, and Mozambique’s minister of Foreign Affairs and Cooperation, Verónica Macamo.
“The Chinese party waives obligations of the Mozambican party in terms of the repayment of three loans, without interest,” said the Chinese ambassador Wang Hejum, without giving further details, in a statement to the press after the signing in which there was no room for questions.
For the Mozambican Minister of Foreign Affairs and Cooperation, “China is a friendly country that has always known how to be by Mozambique’s side in difficult times and in the golden moments. “Therefore, this gesture by China does not surprise us. This brother country has always been consistent in its support for Mozambique,” he declared.
In addition to the partial debt forgiveness, the parties also signed an agreement providing for the Chinese government to disburse 150 million yuan (19 million euros) for social and economic projects.
Debt with China
According to the most recent figures, released by the Minister of Economy and Finance in parliament in November, the debt with China is around two billion dollars (1.6 billion euros), that is, it represents around 16% of the total of around 12.37 billion dollars (around 10 billion euros) of Mozambican public debt.
According to that data, a major part of the debt to China, amounting to US$1.98 billion (1.66 billion euros), is owed to the Chinese Exim Bank and was used mainly for building roads and bridges, including the Maputo ring road, the suspension bridge over Maputo Bay and the roads to the south.
Several civil society organizations have criticized the opacity of the contracts with China, and the Center for Public Integrity (CIP) published a study in October in which it called it “frightening.”
At the time, Adriano Maleiane, Minister of Economy and Finance, dismissed the fears: “I do not have this drama,” he said, considering the debt service with China normal and noting that Maputo’s priority has been to resort to concessional loans.
