United States warns Africa not to expect debt relief
African countries running up debt they won’t be able to pay back, including to China, should not expect to be bailed out by Western-sponsored debt relief, the United States’ top Africa diplomat warned.
The International Monetary Fund and World Bank launched the Heavily Indebted Poor Countries (HIPC) initiative in 1996 to help the world’s poorest countries clear billions of dollars’ worth of unsustainable debt.
But Africa is facing another potential debt crisis today, with roughly 40% of low-income countries in the region now in debt distress or at high risk of it, according to an IMF report released a year ago.
“We went through, just in the last 20 years, this big debt forgiveness for a lot of African countries,” said US Assistant Secretary of State for Africa for African Affairs Tibor Nagy, referring to the HIPC programme.
“Now all of a sudden are we going to go through another cycle of that? . . . I certainly would not be sympathetic, and I don’t think my administration would be sympathetic to that kind of situation,” he told reporters in Pretoria, South Africa, late on Sunday.
Under the Trump administration, the United States has criticised China for pushing poor countries into debt, mainly through lending for large-scale infrastructure projects. It has warned that those nations risk losing control of strategic assets if they can’t repay the Chinese loans.
