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‘Cope with your own debt’, China tells US over Zambia debt relief | Business and Economy News

‘Cope with your own debt’, China tells US over Zambia debt relief | Business and Economy News

Washington and Beijing are vying for influence in Africa, where Chinese banks are major lenders.

The Chinese government says the United States should stop pressuring Beijing on debt relief for Zambia and focus on averting a government default at home, which could have repercussions for the global economy.

“The biggest contribution that the US can make to the debt issues outside the country is to cope with its own debt problem and stop sabotaging other sovereign countries’ active efforts to solve their debt issues,” the Chinese embassy in Zambia said in a statement on Tuesday.

The US government has a cap of $31.4 trillion on how much it can borrow, and it reached that limit on Thursday.

US Treasury Secretary Janet Yellen implemented “extraordinary measures” to ensure the US government can continue paying its bills in the short term and then travelled to Africa. On a visit to Zambia, she said it was crucial for the country to address its heavy debt burden with China.

The country failed to make a $42.5m bond payment in November 2020, becoming Africa’s first sovereign nation to default during the COVID-19 pandemic.

“It’s taken far too long already to resolve this matter,” Yellen said on Monday.

Washington is trying to woo African nations as the influence on the continent of its rivals Russia and China grows.

During her visit to Africa, which also included Senegal and South Africa, Yellen pushed to expand US trade and business ties.

“The United States is all in on Africa, and all in with Africa,” Yellen said on Friday in Dakar as she touted the fruits of a new “mutually beneficial” US economic strategy towards Africa.

In responding to Yellen, China zeroed in on the battle between Republican lawmakers and Democratic President Joe Biden’s administration over raising the US debt limit to allow more borrowing to keep the government running.

“Even if the US one day solves its debt problem, it is not qualified to make groundless accusations against or press other countries out of selfish interests,” the Chinese embassy statement said.

Chinese development banks have emerged as major lenders to poor countries around the world for natural resources, transport and power projects although that lending has fallen sharply and steadily since 2016, according to Boston University’s Global Development Policy Center.

New loan commitments dropped to eight projects totalling $3.7bn in 2021, down from a peak of 151 projects worth $80bn in 2016,…

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