Kyodo News:
My question is about the cooperation under the Belt and Road Initiative. There is a saying that China has caused debt traps for Africa. How much debt does Africa owe to China? How to solve the debt issue? Another question is more specific. Why is this FOCAC a ministerial conference instead of a summit? Will there be a summit in 2021? Thank you.
Wu Peng:
I will answer the questions from Kyodo News. First, I will explain why it is a ministerial conference. We all know that the FOCAC was established in 2000, which was designed to be a ministerial conference when the mechanism started. In 2006, 2015, and 2018, we held three summits and ministerial conferences, respectively. Therefore, the forum mechanism is a ministerial conference. As Mr. Wu Jianghao introduced just now, Chinese President Xi Jinping will participate in the opening ceremony of this ministerial conference in Beijing via video link, which demonstrates the importance that the Chinese government has attached to China-Africa cooperation. This ministerial conference is the activity of FOCAC, which is held every three years.
As for the question about debt that you mentioned, first of all, the so-called debt trap is already a cliché in my view, which has been disproved by a wide range of research conducted by governments, scholars, and institutes across the globe. The basic logic of the debt trap is that China provided unaffordable loans to Africa and would confiscate or take physical assets of African countries when they were unable to pay back the debts. I suggest that the journalist from Kyodo News research if there has been any project that was confiscated by China because African countries can't repay the debts. You won't find a single one.
Not a single developing country has fallen into a so-called trap due to owing debts to China. The fact and statistics also prove that this saying is totally untenable. I can introduce to you China's attitude towards Africa's debt issue and the reasons.
In recent years, Africa has actively promoted social development. However, capital deficiency remained a major bottleneck in reviving Africa. As a sincere and friendly partner of Africa, China has attached much importance to Africa's capital needs and the sustainability of their debts. China sticks to the intensive development philosophy and fully respects the will of the African people. Based on the realities in Africa, China has conducted practical and effective investment and financing cooperation with Africa, which is widely welcomed by African countries.
Indeed, due to the outbreak of the COVID-19 pandemic, some African countries have been confronted with temporary difficulties. China supports reducing the debt burden on African countries and is actively implementing the G20 Debt Service Suspension Initiative (DSSI). Among G20 members, China ranks first in terms of the amount of deferred debt, having signed debt service suspension agreements or reached consensus with 19 African countries. China supports extending the DSSI until the end of 2021, and is working with relevant members to implement the common framework for debt treatments beyond DSSI. The creditor committees of Chad and Ethiopia have already been set up under the common framework, with China and France serving as co-chairs of the Ethiopian Creditor Committee.
China works with relevant parties in supporting the debt reduction and suspension for countries facing an extremely serious epidemic and under severe pressure case by case. China has announced an exemption from debt incurred in the form of interest-free Chinese government loans due to mature by the end of 2018. It will apply to Africa's least developed countries, heavily indebted and poor countries, landlocked developing countries, and small island developing countries that have diplomatic relations with China. During the COVID-19 pandemic, China canceled the outstanding debts of 15 African countries in the form of interest-free loans that matured at the end of 2020. I think that China remains committed to making its contribution.
Africa has achieved remarkable development results over recent years. It is of vital importance to restore and continue the development momentum in the face of the pandemic. China stands ready to work with the international community, stick to the principle of "joint action and fair burden sharing," and implement the Debt Service Suspension Initiative and the common framework for debt treatments beyond DSSI. China supports that those rich countries lend a proportion of their allocation of International Monetary Fund Special Drawing Rights to African countries in need. We also hope that multilateral financial institutions and commercial creditors will take active and concrete actions in expanding investment in Africa and support Africa to achieve economic independence and sustainable development, and eradicate the root causes of debt issues.
It must rely on development to solve Africa's debt issues. African countries are confident in their development prospects. Therefore, we believe that both China and Africa are resolute in solving temporary difficulties that face Africa.
Thank you.
Wu Jianghao:
The "debt trap" rhetoric, which has been frequently hyped in recent years, is actually untenable. Developing countries have their needs for development, and funds are crucial to ensure their development. It is not reasonable to consider the money offered by the Western countries and Japan to developing countries as "official development assistance (ODA)," while those offered by China create a "debt trap." This is untenable. The attitude of recipient countries should not be neglected as well. Has any Western media outlet found a developing country that has accused China of making them fall into a "debt trap"? I don't think so. The "debt trap" rhetoric is fabricated by Western governments and media outlets.
Japan used the loans from the World Bank to implement its Shinkansen project many years ago, and its debts were not paid off until a few years ago. Is it reasonable to argue that the World Bank created a debt trap for Japan? With fairness and justice, it would be easy for us to tell how untenable this argument is. Thank you.
