China locks out Kenya from new debt relief deal

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The elevation of Kenya to the middle-income status saw China lock the country out of a new list of African nations that will receive a Beijing debt relief this year.

“The African countries mentioned here refer to the least developed countries. Therefore, Kenya is not on this list,” added the Chinese authorities.

Kenya planned to spend a total of Sh117.7 billion on Chinese debt in the period, of which about Sh24.7 billion is in interest payments and almost Sh93 billion in redemptions, according to budget documents. But opposition from Chinese lenders forced Nairobi to drop its push for an extension of the debt repayment holiday to avoid straining relations with Kenya’s biggest bilateral creditor.

The G20 countries, including Belgium, Canada, Denmark, France Germany, Italy, Japan, Republic of Korea, Spain and the USA, rescheduled payments of Sh32.9 billion in principal and interest due between January and June to the next four years with a one-year grace period. President Uhuru Kenyatta’s administration has largely taken loans from China since 2014 to build roads, bridges, power plants and the standard gauge railway .

 

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