Narrative
Full Description
Project narrative
On May 25, 2007, the Chinese Government and the Government of Burundi signed an agreement on the remission of the Government of Burundi’s outstanding debt obligations to the Chinese Government. This debt forgiveness agreement reportedly eliminated all of the Government of Burundi’s outstanding debt obligations (worth RMB 213 million). The debts that were forgiven resulted from interest-free Chinese Government loans that the Government of Burundi previously contracted.
Staff comments
1. The IMF and SAIS-CARI record the amount of debt forgiveness that was provided as $13.7 million and $15 million, respectively. However, since the Chinese Government forgave the Government of Burundi’s outstanding debt obligations resulting from interest-free loans that it previously contracted, and interest-free loans from the Chinese Government are almost always denominated in RMB, AidData treats RMB 213 million as the value of the debt that was forgiven. 2. The Chinese Government made a concerted effort in 2007 to forgive the debt from interest-free loans maturing by the end of 2005 to heavily-indebted African countries (http://kp.china-embassy.org/chn//zgxw/zgzxxw/t293317.htm). Since interest-free loans usually have 20-year maturities (http://www.gov.cn/zwgk/2011-04/21/content_1850553.htm), AidData has assumed the loans included in the debt forgiveness package were contracted before 2000. As such, this record is not coded as an umbrella record, as there is little risk of double counting.