"The 'Debt Trap' narrative aims to discredit China's growing influence in Africa and to maintain Western dominance," Moshi said.
by Xinhua writers Wang Zongnan, Zhao Zhiqin
BEIJING, Sept. 2 (Xinhua) -- "Debt-trap" is a term to describe an international financial relationship where a creditor country or institution extends debt to a borrowing nation with the intention of extracting economic or political concessions when the debtor country becomes unable to meet its repayment obligations.
Western media have pinned the "Debt Trap" narrative on China since an Indian think tank coined the term in 2017.
However, many academics, professionals and think tanks have asserted that China's lending practices are not behind the debt troubles faced by borrowing nations, and that Chinese banks have been willing to restructure the terms of existing loans.
"Only about nine percent of Kenya's public debt can be attributed to China at the moment," Adhere Cavince, an international relations specialist from Kenya, told Xinhua.
The National Treasury of Kenya's debt bulletin, published in April 2024, reported that more than half (51.5 percent) of the country's external debt is owed to multilateral lenders like the World Bank and the International Monetary Fund (IMF). In contrast, China and other bilateral lenders account for only a fifth (21.5 percent) of Kenya's bilateral debt.
A briefing paper titled "Integrating China into Multilateral Debt Relief: Progress and Problems in the G20 DSSI," published by Johns Hopkins University, found that among the 46 countries participating in the Debt Service Suspension Initiative (DSSI) launched by the World Bank and the IMF, Chinese creditors accounted for 30 percent of all claims and contributed to 63 percent of debt service suspensions.
In contrast to the unfulfilled promises of debt relief by the Western world, "China has been far more generous in providing relief to allow for African countries to manage their post-COVID recovery," said Charles Onunaiju, director of the center for China studies in Nigeria.
"China's approach to debt relief has been more flexible, often involving the restructuring of loans to provide breathing space for debtor countries," said Humphrey Moshi, director of the center for Chinese studies at the University of Dar es Salaam in Tanzania. "In contrast, other creditors have been more rigid, prioritizing their financial returns over the economic recovery of African nations."
"The 'Debt Trap' narrative aims to discredit China's growing influence in Africa and to maintain Western dominance," Moshi said.
"It is neither in the interest of emerging economies nor that of China," Cavince said. "That is why, despite the hype, no African country is taking it seriously."■
