The President of the African Development Bank (AfDB), Dr Akinwumi Adesina, has said that the continent has no debt crisis.
Adesina made the remark while fielding questions on the sidelines of the just concluded Forum on China-Africa Cooperation (FOCAC) Beijing Summit.
He noted that Africa saw an overall debt-to-GDP ratio of 37 percent in 2017, which, albeit up from 22 percent in 2010, is within the reasonable range for low-income countries, stressing that the ratio is markedly lower than 100 percent or 150 percent of many higher-income countries and over 50 percent of emerging economies’.
The AfDB boss expressed the view that Chinese loans were mainly dedicated to the infrastructure in Africa to attract investors, stressing that any country that has good infrastructure naturally attracts investors, who will come and create jobs and boost governments’ revenue.
“African countries are desperate for infrastructure. The population is rising, urbanization is there, and fiscal space is very small. They are taking on a lot more debt, but in the right way,” Adesina added.
It is instructive to note that over the past few years, China has been providing money-starved African countries with loans that are urgently needed to build roads, power plants, and factories, as infrastructure is considered the precondition for African countries to propel industrialization and achieve prosperity.