China Open to Suspending Kenya’s Loan Repayment over COVID-19 Pressure

China has expressed its willingness to suspend the repayment of debts owed by Kenya.

This comes after the Kenyan government requested a suspension in a bid to relieve the country’s economy from the shocks occasioned by the COVID-19 pandemic.

Through its Nairobi embassy, China indicated that it is ready to strengthen coordination with Kenya to help it address debt challenges.

“Africa’s need is always China’s concern. We stand ready to strengthen coordination with Kenya and assist Kenya in its efforts to address debt challenges. Both sides are now keeping efficient communication through smooth channel,” the Chinese Embassy in Nairobi stated.

Already, China has signed debt repayment suspension deals with 12 African nations in addition to providing waivers of a matured interest-free loan for 15 others under the G20 framework. No other G20 member has suspended more debt service than China. 

All eligible debt suspension requests made by developing nations have been implemented by the China International Development Cooperation Agency and the Exim Bank of China.

“China attaches great importance to debt suspension and alleviation in African countries including Kenya and is committed to fully implementing the G20 Debt Service Suspension Initiative (DSSI),” the Embassy added.

Kenya has used funds borrowed from China to undertake key infrastructural projects including the Mombasa-Nairobi-Naivasha Standard Gauge Railway and the Westlands-Jomo Kenyatta International Airport (JKIA) Express Way, whose construction is underway.

Kenya owes China at least Sh3.2 trillion, making it the country’s largest bilateral creditor.