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Debt trap, seizure of parastatals narrative with no grounds — China ambassador

In an exclusive interview, China envoy defends lending, saying no country has fallen into “debt trap” because of their loans

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by ELIUD KIBII

Siasa05 March 2022 - 04:51
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In Summary


  • •  Ambassador Zhou Pingjian says Kenya owes less than 10 per cent of its public debt, or, less than 20 per cent of its foreign debt, to Chinese creditors
  • •  Says claims China’s financial institution will seize any Kenyan parastatal is nothing but ill-intentioned speculation that has no factual grounds. 
China Ambassador to Kenya Zhou Pingjian during an interview with the Star at the Chinese Embassy in Nairobi on February 25

Pretty much every major infrastructure project in Kenya is being undertaken by the Chinese. It is not by chance. 

Since China established diplomatic relations with Kenya on December 14, 1963, these ties have grown through the four Kenyan administrations.

After 1965 — during President Jomo Kenyatta's regime — the bilateral relations were lowered to the chargé d'affaires level, which in the 1970s was gradually returned to the normal.

When President Daniel Moi rose to power in 1978, diplomatic ties blossomed. This was the period after China State Council introduced legislation permitting specialised Chinese companies to operate overseas under the 'Go Out' policy in August, 1979.

One of the key projects delivered through the Kenya-China partnership at the time was the Moi International Sports Centre Kasarani in 1987. 

When President Mwai Kibaki came to power in 2002, there was a massive shift towards China in what was called the Look East policy. 

This further deepened and expanded bilateral cooperation in infrastructure development and trade, which has intensified during the Kenyatta administration.

With these close ties, however, there have been concerns about loans, fears of "debt trap" diplomacy, secrecy in deals and parastatals being at risk of being seized.

The Star's Eliud Kibii spoke with China Ambassador to Kenya Zhou Pingjian to discuss these issues and Kenya and China relations. 

You presented your credentials on September 2, 2020. This was at the height of the Covid-19 outbreak, which almost affected Sino-African ties. How were you able to handle this and the disruption the pandemic caused on your interests in Kenya?

China and Africa are trustworthy friends and sincere partners forever. We have always supported each other in trying times. Our cooperation and mutual support in the fight against Covid represents a prime example of solidarity in the face of a disease.

China will never forget the invaluable material and spiritual support from our Kenyan brothers and sisters when China faced its most difficult moment. China will continue to stand by Kenya in its fight against the virus. Pamoja tutashinda.

There were claims of racism at the time that almost disrupted the relations between China and Africa. How was this handled?

As I said, we have always supported each other in trying times. 

And at the early stages, because the outbreak was a new thing to everybody, there might have been some misunderstandings. But with the deep-rooted friendship, our two sides quickly solved the misunderstanding. 

2. You are the seventeenth Chinese ambassador to Kenya. How would you describe the status of Kenya and China relations now?

China and Kenya share a profound tradition of friendship. As early as 600 years ago, Zheng He, the legendary Chinese navigator, sailed to the East Africa coast with a message of friendship and goodwill.

Since the establishment of diplomatic ties on December 14, 1963, two days after your Independence, China and Kenya have forged a strong partnership of equals, particularly in recent years.

Under the strategic guidance of President Xi [Jinping] and President [Uhuru] Kenyatta, the China-Kenya relationship is in its best shape.

Our fruitful and wide-ranging practical cooperation stands out in China-Africa cooperation, delivering solid benefits to the people of both countries. China and Kenya have become a community of shared interests and future.

3. Upon presenting your credentials, you said China will continue supporting Kenya's development agenda, particularly Vision 2030 and Big Four agenda projects. How has the pandemic affected this?

Since my arrival a year and half ago, I’ve had the privilege to visit some of the ongoing projects. Konza data centre and smart city facilities., Nairobi western bypass, Nairobi expressway, GTC Nairobi, KOT in Mombasa, industrial parks in Athi River and others. They are doing very well in spite of the Covid challenge.

On the construction site of the Western bypass, I was so impressed that 50 Chinese technicians and their 1500 Kenyan colleagues are working day-in-day-out to deliver the project on time.

As one of the 6.7 million SGR passengers served since its operation, I was thrilled to see Mt. Kilimanjaro while on my train trip to Mombasa. SGR safari, isn’t it? The pandemic challenge is real, yet cooperation carries on.

Early this year, Kenya and China signed various agreements to implement the Comprehensive Strategic Cooperation Partnership signed in 2018. What is the status of the partnership agreement?

China-Kenya relationship has upgraded twice, in August 2013 and May 2017, when President Kenyatta was visiting China.

Remarkable progress has been made in our comprehensive strategic and cooperative partnership.

I am an eye-witness. I was here in the embassy between 2008-11 [as deputy chief of mission] and none of the cooperation projects I mentioned earlier was there at that time.

Going forward, China and Kenya will strengthen and deepen our partnership in four respects, as agreed during State Councilor and Foreign Minister Wang Yi’s official visit to Kenya on January 5-6.

First, we will be partners that firmly support each other. Second, we will be partners in accelerating development and revitalisation. Third, we will be partners in promoting China-Africa solidarity and fourth, we will be partners in maintaining regional peace.

The cordial relationship between Kenya and China is in its best shape.  

There has been uproar or criticism over increased foreign debt, a lot of it owed to China. What is your reaction?

I understand this is a big issue, in the media in particular, and I  wish to make three points here.

One, Kenya owes less than 10 per cent of its public debt, or, less than 20 per cent of its foreign debt, to Chinese creditors. China is not the biggest lender to Kenya.

Two, all the loans from China are project-specific based on equal-footed consultation and mutually beneficial cooperation. The fruitful and tangible outcomes of China-Kenya financing cooperation are solid there for all to see.

Three, not a single developing country has ever fallen into the so-called debt trap because of Chinese loans. In fact, the so-called debt trap is a narrative trap created by those who wish to forever plunge Africa into a poverty trap and backwardness trap.

Development takes financing support, internal or external. It cannot be said that only the loans provided by Western countries in the past were development aids, while those from China now are called “debt traps”.

There have been concerns among Kenyans about the secrecy of the Kenya-China contracts, SGR for instance. Why is this the case? And are any Kenyan parastatals at risk having guaranteed the loans?

There is no secrecy issue here. As we see it and as the facts go, I am also struggling to understand the narrative.

Our perspective is that in light of Kenya’s needs and requests, China has provided financing support to cooperation projects to the best of its capability. I want to stress here that China has no capacity to impose any loan, any contract on any country, including our Kenyan friends. We try to do our best in line with requests from our friends. That’s what friends are for.

Moreover, China always follows the principle of openness, transparency, equality and mutual benefit. Every financial support goes through in-depth feasibility study and market-based assessment. All those loan agreements have been signed through consultation on a voluntary basis between both sides.

The so-called allegation that China’s financial institution will seize this or that or any Kenyan parastatals is nothing but ill-intentioned speculation that has no factual grounds.

In fact, not a single China-Africa cooperation project has been taken over or confiscated by China due to debt problems. I trust discerning Kenya friends will see through those misinformation or disinformation. No country can be denied the right to development.

You recently launched the GTC Nairobi. What would you say it brings to Kenya’s property market, and will we see more these?

The Global Trade Center Nairobi Kenya is indeed GTCNK — Go Together China and Kenya, Grow Together China and Kenya.

As a new landmark of the beautiful city in the sun, it speaks volumes about the confidence of the Chinese business community in Kenya.

The eighth Ministerial Conference of the Forum on China-Africa Cooperation was held on November 29 and 30 in Dakar, Senegal. What would you say were the wins for African states?

The FOCAC conference achieved a full success. Kenya’s significant contribution to the conference is highly appreciated.

In his keynote speech delivered through video link at the opening ceremony, President Xi announced that China will work closely with African countries to implement nine programmes in the next three years to come. They are related to medical service and health, poverty reduction and agricultural development, trade and investment promotion, digital innovation, green development, capacity building, cultural and people-to-people exchange, and peace and security.

China always honors its commitments, which is a distinctive feature in its cooperation with Africa.

What is the status of trade between Kenya and China, and which are the unexploited opportunities do you think both sides should focus on?

Kenya’s export to China expanded 50.5 per cent year on year to $227 million in 2021.

China doesn’t pursue trade surplus with Kenya. The trade pattern is determined by market forces.

Meanwhile, trade promotion programme is one of the nine programmes I mentioned earlier. China will open “green lanes” for African agricultural exports to China, speed up the inspection and quarantine procedures, provide $10 billion of trade finance to support African export, in a bid to reach $300 billion in total imports from Africa in three years (2022-24).

Opportunities abound for our bilateral trade. Recently, we signed the protocols facilitating Kenya’s fresh avocados and aquatic products exports to Chinese market.

Finally, what would you want your legacy as ambassador to look like? What are your priority areas and achievements so far?

Both China and Kenya are major developing countries. Development holds the key to people’s well-being.

Facing the severe shocks of the pandemic, the implementation of the 2030 Agenda for Sustainable Development is confronted with new challenges, so are China’s modernisation drive and Kenya’s Big Four agenda and Vision 2030.

At the same time, the burgeoning industrial revolution and the new forms of businesses and models brought by digital and green development as well as the pandemic have created opportunities for leapfrog development for developing countries.

We need to strengthen our development cooperation for greater mutual benefit. There is a lot of synergy between the FOCAC nine programs and the eight priority areas identified by the Global Development Initiative, which was put forward by President Xi last year.

The GDI, with its priority areas including poverty alleviation, food security, Covid-19 and vaccines, financing for development, climate change and green development, industrialisation, digital economy, and connectivity, has set out a blueprint for rising up to the changing international landscape, and charts the course for global common development and international development cooperation.

I am fully convinced that the friendship and cooperation between China and Kenya will go from strength to strength.

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