AFRICAN LEADERS IN CHINA FOR MORE LOANS AS TRADE IMBALANCE PERSISTS

Construction works on Phase 2A of the Kenya's standard gauge railway at Suswa. China Communications Construction Company are the contractors.

China will this week host a forum where development projects for the next three years will be discussed.

African leaders are going to Beijing for the Forum on China-Africa Co-operation (FOCAC) Summit, hoping to get financing for their mega infrastructure projects.

The summit themed "China and Africa: Towards an Even Stronger Community with a Shared Future through Win-Win Cooperation," is meant to link the Belt and Road Initiative with the UN 2030 Agenda for Sustainable Development, the AU’s Agenda 2063 and individual countries' development plans.

But it comes at a time when some African countries are grappling with an external debt burden and a trade balance favouring Beijing.

Credit rating firms and global financial institutions have been advising against taking out further loans, instead recommending fiscal consolidation to arrest the ballooning debt.

Kenya, for instance, had taken over $5 billion from China as at the end of March 2018 while Uganda owed China $1.6 billion. Kenya’s National Treasury has recently been under pressure to slow down the growth of public debt, with the International Monetary Fund raising its concerns.

Even then, East African Presidents Paul Kagame of Rwanda — who is also the African Union chairman — Yoweri Museveni of Uganda and Uhuru Kenyatta of Kenya are expected to attend the summit and seek financing for their joint infrastructure projects, particularly the standard gauge railway.

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