China’s loans to Africa worry World Bank President David Malpas

0
1050

The president of the World Bank has told the BBC that he is concerned about some of the loans China has been making to developing economies in Africa.

David Malpass says the terms and conditions need to be “more transparent”.

It comes amid worries that countries including Ghana and Zambia are struggling to repay their debts to Beijing.

China says that any such lending is done within international rules.

Developing countries often borrow money from other nations or multilateral bodies to finance sectors that will grow their economies such as infrastructure, education and agriculture.

However steep increases in interest rates in the US and other major economies over the last year are making loan repayments more expensive because lots of that borrowing is done in foreign currencies such as US dollars or euros.

It is a particularly acute problem for developing economies who can struggle to find the extra money that is required as the relative value of their own currency falls.

It is a “double whammy and it means that [economic] growth is going to be slower”, says Mr Malpass.