Brazil To Write Off Or Restructure $900 Million Of African Debt
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Brazil has offered to cancel or restructure nearly $900 million in debt owed to it by African countries, according to a Reuters report, in its latest effort to boost economic ties with the resource-rich continent, which accounted for about $26.5 billion in trade last year.
Brazil has offered to cancel or restructure nearly $900 million in debt owed to it by African countries, according to a Reuters report, in its latest effort to boost economic ties with the resource-rich continent, which accounted for about $26.5 billion in trade last year.
The announcement was made on Saturday during President Dilma Rousseff’s visit to Addis Ababa, Ethiopia, to mark the African Union’s 50th anniversary; and will see a new development agency set up alongside the debt plan – offering more assistance to African countries.
[quote]”To maintain a special relationship with Africa is strategic for Brazil’s foreign policy,” said Rousseff’s spokesman, Thomas Traumann, as cited by the BBC.[/quote]“Almost all (the aid offered) is cancellation,” he added, noting that the government had been legally restricted from offering new loans and long-term financial assistance to African countries with outstanding debts in the past.
Among the African countries set to benefit from the debt cancellation include oil-rich Congo-Brazzaville, Tanzania and Zambia – who owe Brazil $352 million, $237 million and $113.4 million respectively.
The other countries to benefit are Ivory Coast, Gabon, Guinea, Guinea Bissau, Mauritania, Democratic Republic of Congo, Sao Tome and Principe, Senegal, and Sudan.
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According to Traumann, most of the debt had been accumulated in the 1970s. A spokesman for Brazil’s Foreign Ministry also said that the debt had not been cancelled would be restructured to see more favourable interest rates and longer repayment terms.
The visit to Ethiopia was President Rousseff’s third visit to African in as many months. Rousseff met with several African leaders, including Ethiopian Prime Minister Hailemariam Desalegn, with whom she signed a series of cooperation agreements on agriculture, education, air transport and science.
Traumann said that the planned new development agency would aid African countries in infrastructure, agricultural and social programmes.
[quote]“Brazil has great expertise in what we call tropicalising European crops. We have that technology,” he said. “The idea is how to transfer that technology from Brazil to other African countries.”[/quote]Brazil’s interest in Africa is also part of a larger trend boosting the so-called South-South cooperation, which has seen faster-growing emerging economies to trade and invest among themselves. Official data in Brazil show that its trade with Africa has increased fivefold in the past decade.
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