March 26, 2023
2 mins read

Chinese debt trap hurdles Zambia’s progress

China, which has a keen interest in the natural resources of African countries, takes this as an opportunity to make African countries to be dependent on China, and to gain control of their natural resources…reports Asian Lite News

Zambia is facing an unsustainable debt burden, and debt servicing is leaving little room for capital formation, especially funds needed for infrastructure development, reported Africa Daily Digital.

While the country is struggling to take up World Bank-suggested reforms such as restoring fiscal and long-term debt sustainability, increasing farmers’ productivity and access to agricultural markets, ensuring access to energy and finance, and private sector development, it is facing a scarcity of resources, which makes the country dependent on and vulnerable to external debt. Following this, the Zambian government has started actively seeking additional infrastructure development through Public-Private Partnership (PPP) projects. Zambia, like other indebted and capital-strapped African countries, urgently require funds to develop infrastructure to connect its mineral-rich areas to major cities and ports, as reported by Africa Daily Digital.

Zambia is under a heavy debt burden, and the post-Covid economic recovery is slow. In such a situation, it is difficult to upgrade the dilapidated road connecting its mining sites to export destinations in the lack of funds to build infrastructure, Africa Daily Digital reported.

China, which has a keen interest in the natural resources of African countries, takes this as an opportunity to make African countries to be dependent on China, and to gain control of their natural resources.

Although China’s Belt and Road Initiative (BRI) is assisting many African countries in building infrastructure, the end result is a debt burden on these countries, which in turn forces them to sell their natural resources at lower prices in order to raise funds for debt repayment.

A consortium of Chinese companies recently won a bid to finance the upgrading of a 327-kilometre road connecting Zambia’s capital Lusaka to Ndola in the country’s Copperbelt province. The bid was won by the Consortium Macro Ocean Investment, which is made up of three Chinese companies: AVIC International Project Engineering, Zhenjiang Communications Construction Group, and China Railway Seventh Group. The consortium won the USD 650 million public-private partnership (PPP) contract to build the dual carriageway road. The Chinese companies signed a 25-year concession agreement last month, with three years for construction and 22 years for operation and maintenance rights.

ALSO READ-Defence minister meets Zambian counterpart  

Previous Story

Africa India Economic Foundation, African Union ink MoU

Next Story

Ways to make your home look more luxurious

Latest from -Top News

India-EU Partnership Eyes Future with Bold Plan

European Commission President Ursula Von Der Layen, Prime Minister Narendra Modi said that the two-decade-long strategic partnership between India and the EU is natural and organic…reports Asian Lite News From the bilateral

EU-India Ties to Reach New Heights, Says Modi

European Commission President Ursula von der Leyen thanked PM Modi for hosting the EU delegation, calling the visit a symbol of the EU’s strong partnership with India….reports Asian Lite News Calling the

AHLAN RAMADAN 

The UAE Council for Fatwa has called upon citizens and residents to observe the crescent moon today evening, which will determine the start of Ramadan 1446 AH.  As the UAE gears up
Go toTop

Don't Miss

With nearly 200 aircraft, China ramps up military pressure on Taiwan

Taiwan has been witnessing an increase in incursions as Beijing

Trump pledges tariffs, repeats false claims of Chinese automakers

Auto jobs dipped 0.8 per cent during Trump’s term to