Congolese President Denis Sassou Nguesso and Chinese President Xi Jinping agreed in a telephone interview on Monday to restructure Congo's colossal debt to Beijing, which is preventing the Central African country from resuming negotiations with the International Monetary Fund (IMF).
"The issue of debt was raised by the two presidents and President Sassou Nguesso raised the problem with his peer (...) by making a proposal for a second restructuring," Rigobert Roger Andely, Congo's finance minister, told the press. "President Xi Jinping has approved (the request)," he added, reporting on a telephone interview with the two heads of state.
"This restructuring is to allow the country to have a little more resources to meet its own internal needs and to remove this obstacle to good relations with the IMF," Andely explained. The Chinese and Congolese experts are responsible for "being able to set the terms and conditions", he said.
Congo owes China $2 billion
In Beijing, the China News Agency also mentioned the phone call between the two leaders, but without mentioning a restructuring of the Congolese debt. Xi Jinping said China would encourage its companies to invest more in Congo, particularly in health and agriculture, the Chinese news agency said.
In 2019, China had already restructured Congo's debt, which allowed the country to conclude a program focused on the Extended Credit Facility with the IMF. But since then, The Congolese debt estimated at 110% of the Gross Domestic Product (GDP) by the IMF is considered "unsustainable", the Community standard in Central Africa being 70% of the GDP, Congolese Prime Minister Anatole Collinet Makosso told the National Assembly on Monday.
The IMF has suspended its support. The country is doubly hit by the economic and health crisis due to the fall in oil prices and the spread of Covid-19. Congo owes China 1,300 billion FCFA (2 billion dollars), according to the government, while the country's overall debt "currently amounts to 6,016.5 billion FCFA (more than 10 billion euros) on 31 December 2020, i.e. 98% of the GDP", estimated Prime Minister Makosso.