Musings From Abroad

China won’t put Nigeria in debt crisis— Consul-General, Yuqing

Published

1 year ago

November 17, 2023

The Chinese Consul-General, Lagos, Nigeria, Yan Yuqing, on Thursday promised that her country would not create a debt crisis in Nigeria and other African countries.

Yuqing made the position known at the 18th China-African lecture held at the Faculty of Arts of the University of Lagos. She reiterated that the partnership between China and African countries was aimed at reducing the poverty level on the African continent.

She said, “China has never been a creator of the debt crisis of African countries. China partners to help African countries to deal with their poverty problems. Under the framework of G20, there is a plan to delay debt repayment and China has contributed more than 60 per cent and done more than other G-20 members. China will never threaten to sanction any African country with recourse to contracts between the two countries.

“The people of Nigeria and China are wonderful, hard-working and friendly. We have very good results in several fields such as infrastructure, trade and investment, education and culture. These are very important parts of our bilateral relationship.”

Applauding the Chinese socialist model, the Dean of the Faculty of Social Sciences, Prof. Adelaja Odukoya noted, “I call that Chinese essentialism. This means they don’t forget their roots and they are very passionate about what they are. Whether you like socialism or not, it is a different thing. If there is any social organisation that takes people from wealth into a superpower, it is the society that practises socialism. We have an example of China. Go back to 1949, where was China then and where is it today? Go back to 1917, where was Russia and where is it today? Capitalist society has done nothing for us in Nigeria.”

China is Africa’s biggest creditor. In April, the Chinese Foreign Ministry Spokesperson, Wang Wenbin urged the United States and other creditors to take seriously their obligations and make more effort to resolve the debt problems in African countries.

Although China is the main creditor to some countries like Zambia, South Africa, and Zimbabwe, Wang argued that “data from the World Bank showed that multilateral financial institutions and commercial creditors hold nearly three-quarters of Africa’s total external debt, creating the biggest debt burden for African countries. which constitutes the biggest source of debt pressure on developing countries”.

The IMF in a 2022 report said 2022 described the near-term outlook for Sub-Saharan Africa as “extremely uncertain”. The Fund warned public debt and inflation were at “levels not seen in decades” and says several countries face “difficult sociopolitical and security situations.”

Several African countries like Zambia, Nigeria, Ghana, Tunisia, and Egypt are grappling with high foreign debt.

Related Topics:China debt burden Featured Nigeria

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Musings From Abroad

World Bank suspends loan fees for impoverished countries

Published

14 hours ago

December 26, 2024

Ifeoluwa Dada

To lower borrowing costs for vulnerable nations, the World Bank has announced the elimination of several loan fees. The action is a component of larger initiatives to increase financial capacity and tackle pressing global issues including inequality, climate change, and economic instability.

This was revealed by the international bank in a statement on Wednesday. The bank has extended its lowest pricing to tiny, fragile nations, removed the prepayment cost on International Bank for Reconstruction and Development loans, and instituted a grace period for commitment fees on undisbursed amounts.

“The bank is working hard to make it easier for countries to borrow and to pay back their loans more easily by removing some fees on IBRD loans,” the financial institution stated.

The financier claims that these adjustments are intended to relieve the financial strain on countries that require development funding the most.

“These measures are designed to make borrowing easier and more affordable for countries facing significant challenges,” the bank said. It added that the reforms align with its vision of building a “better, more efficient, and bigger” institution capable of addressing overlapping global crises.

The World Bank’s larger financial reforms, which include fee eliminations, are intended to boost lending capacity by $150 billion over the next ten years.

As part of the changes, the IBRD’s equity-to-loans ratio was lowered from 20% to 18%, allowing for an additional $70 billion in lending over ten years.

According to the statement, $1 billion was obtained through a guarantee from the Asian Infrastructure Investment Bank, and an additional $10 billion has been released through bilateral guarantees.

“The adjustments to our capital framework reflect our commitment to scaling up resources while maintaining financial stability,” the bank said.

The international lender highlighted that these adjustments are essential to tackling the billions of dollars that are required each year to help fragile governments, fight climate change, and advance digital inclusion.

It did concede, nevertheless, that states and multilateral organisations are insufficient to discharge these financial obligations on their own.

The Bank has created a Framework for Financial Incentives to close the gap, promoting investments in cross-border issues like pandemic prevention, energy access, water security, and biodiversity.

Musings From Abroad

Russian Foreign Ministry claims cargo ship sinks in Mediterranean following explosion

Published

14 hours ago

December 26, 2024

Ifeoluwa Dada

The Russian Foreign Ministry reported Tuesday that two crew members are still unaccounted for after an explosion tore through the engine room of a Russian cargo ship, Ursa Major, which sunk in the Mediterranean Sea overnight.

Built-in 2009, the ship was under the management of Oboronlogistika, a business involved in the military building activities of the Russian Defence Ministry.

The corporation had previously claimed that the ship was on its route to Vladivostok, a port in the far east of Russia, with two enormous port cranes attached to its deck.

Fourteen of the ship’s sixteen crew members had been rescued and sent to Spain, according to a statement from the Foreign Ministry’s crisis department, while two have remained unaccounted for. The reason for the engine room explosion was not mentioned.

The state news agency RIA reported that Russia’s embassy in Spain was in contact with Spanish authorities and was investigating the sinking’s circumstances.

Both Oboronlogistika and SK-Yug, the ship’s direct owner and operator and a company listed by LSEG as a member of the group, declined to comment on the sinking.

In 2022, the United States imposed sanctions on both organisations and the Ursa Major itself due to their connections to the Russian military.

Unconfirmed video footage taken by a passing ship on December 23 showed the ship significantly listing to its starboard side with its nose far lower in the water than usual. The clip was posted on Russia’s life.ru news portal on Tuesday.

The Ursa Major sent out a distress call to Spain’s Maritime Rescue Service on Monday while it was around 57 miles off the coast of Almeria.

A ship in the area reported poor weather, a lifeboat in the sea, and the Ursa Major listing to the starboard side, according to the report.

A passing ship captured unconfirmed video footage of the ship on Dec. 23 listing substantially to its starboard side, with its bow much lower down in the sea than usual. The clip was posted on Russia’s life.ru news portal on Tuesday.

On Monday, while the Ursa Major was around 57 miles off the coast of Almeria, Spain’s Maritime Rescue Service reported that it had received a distress call. According to the statement, it had gotten in touch with a neighbouring ship that had reported poor weather, a lifeboat in the sea, and the Ursa Major lowering.