Chinese Government cancels $17.12 million of the Government of Equatorial Guinea’s outstanding obligations

In 2006, Li Zhaoxing, China’s Foreign Minister, traveled to Africa, visiting Chad, Benin, Mozambique, the Central African Republic, Equatorial Guinea and Eritrea. During this trip, he signed a debt cancellation agreement with the Government of Equatorial Guinea. Neither party disclosed the amount of debt that was forgiven. However, the IMF reported that the agreement forgave debts resulting from previously contracted interest-free loans (with maturity dates on or before December 31, 2005), reducing the Government of Equatorial Guinea’s outstanding debt obligations to the Chinese Government by approximately 50%. The IMF also recorded a reduction in the Government of Equatorial Guinea’s outstanding debt obligations to the Chinese Government — from $33 million in 2005 to $15.88 million in 2006. Therefore, AidData estimates the value of the debts that were forgiven as $17.12 million.

Additional details

The debts that were written off through this agreement were almost certainly contracted before 2000, so AidData has not coded this project as an “umbrella project” (as there is little risk of double-counting loans that were contracted from 2000 onward).

Number of official sources

4

Number of total sources

9