Africa’s Debt Burden: These 10 African Countries Owe China Over $60 Billion

Africa’s debt burden, especially its significant indebtedness to China, poses a stark challenge to its economic autonomy and development, despite the projection by the International Monetary Fund that African economy will expand by 4% by 2024 – making it the fastest-growing economy globally.

A substantial portion of Africa’s debt burden is tied to Chinese loans, which account for 12% of the continent’s total indebtedness according to World Bank data.

Here is an overview of the ten African countries with the most substantial debts to China, cumulatively surpassing $60 billion:

1. Angola

Angola tops the list with $20.98 billion, a debt used to fund reconstruction of infrastructure post-civil war. Angola’s oil wealth has also led to loan-for-oil agreements, enhancing China’s stake in its oil sector.

2. Ethiopia

Ethiopa is indebted to the tune of $6.82 billion, with investments powering key projects like the Addis Ababa-Djibouti Railway, which are pivotal for its industrial and economic expansion.

3. Kenya

Kenya’s debt is $6.69 billion. The loans were used to support its infrastructure projects such as the Standard Gauge Railway, crucial for enhancing regional trade and connectivity.

4. Zambia

With a debt of $6.08 billion, Zambia’s focus has been on mining and infrastructure, sectors that are vital due to Zambia’s abundant copper resources.

5. Egypt

Egypt has accumulated $5.21 billion in debt, with funds largely allocated to infrastructure and energy sectors, including the ambitious New Administrative Capital project.

6. Nigeria

Nigeria’s debt to China stands at $4.29 billion. The loans were used to fund infrastructural developments like railways and power plants, representing a significant portion of its bilateral debts.

7. Côte d’Ivoire

Côte d’Ivoire shows a $3.9 billion debt, with China playing a significant role in the nation’s post-pandemic recovery and ongoing economic projects.

8. Cameroon

Cameroon has incurred $3.8 billion in debt. China’s role extended to debt relief in 2019, forgiving about $78 million to help alleviate the country’s economic pressures.

Republic of Congo

Congo owes $3.4 billion, with the Chinese loans predominantly financing large-scale infrastructure projects such as highway developments.

10. South Africa

South Africa’s debt is $3.4 billion. It has historically relied on Chinese loans for various development projects, including sustaining operations of its major power utility, ESKOM.

While these loans have facilitated essential developments across the continent, Africa’s debt burden to China is a double-edged sword. It brings necessary infrastructure and economic boosts but also creates dependency and potential pitfalls for fiscal management.

As African nations strive for further growth, balancing these debts with sustainable economic policies will be crucial for maintaining their economic sovereignty and long-term stability.