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President Kagame (right) welcoming president Jinping during his visit in Rwanda in July 2018

Rwanda has no fear over debt from China

June 21, 2019

By Maniraguha Ferdinand

President Kagame (right) welcoming president Jinping during his visit in Rwanda in July 2018

President Kagame (right) welcoming president Jinping during his visit in Rwanda in July 2018

Rwanda says it doesn’t worry the level of the debt it owes China because it has not got to the alarming line.

It was revealed  during the signing ceremony this Tuesday, where China gave Rwanda USD 42 million grant worth which will be used to expand and upgrade roads in the city of Kigali.

Rwanda’s external debt stands at 41 percent of GDP according to the  official statistics.

Though statistics doesn’t show level of debt from China, officials from Ministry of Finance emphasized it is still below 9 percent of the external debt.

Addressing the press after the signing of the agreement, Rwanda’s State Minister in charge of Planning, Dr Uwera Claudine said Rwanda does not see debt from China as a burden.

“We don’t have to worry debt, grant or funds we receive from China, because our national debt level is still very low. We are still in need of them because we benefit more”, she said

Rwanda says a debt from China is not wasted but used to promote welfare and national development.

The  data released last year by   the China-Africa Research Initiative (Cari) at John Hopkins University showed that during last ten years, East African economies have borrowed $29.42 billion from China with Rwanda borrowing $289 million.

This money was used mainly in transport, communication, manufacturing and energy sectors.

In interview with Pan African Visions last month, a Kenyan scholar Prof Patrick Loch Otieno Lumumba warned  African countries over taking China’s debt uncontrollably.

He said “ China has defined what it wants, they know that Africa has potentials  it is time for Africa to re-examine  what it wants. The existing relations between China and Africa, it is like relations between a rider and a horse and the horse is Africa”.

In July last year  China President Xi Jinping visited Rwanda. He said he was looking to build mutually beneficial relations with Rwanda.

During his stay in Rwanda, President Xi and President Paul Kagame signed 15 agreements worth millions of dollars in areas like trade, infrastructure, investment,  human resource, culture, technology, aviation, mining among others.

 

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