Uganda’s Debt Worries China
By Fred Kajjo
Chinese Ambassador to Uganda, Zhang Lizhong, has expressed concern over Uganda’s soaring public debt, which now accounts for almost half of the country’s GDP. However, he is confident that the debt is still sustainable.
Speaking at a press conference where he revealed China’s strategic plans for Africa, Zhang Lizhong expressed concerns of Uganda’s swelling public debt which accounts for 50% of national GDP. Uganda’s public debt currently stands at 116tn shillings, with China alone accounting for close 10tn shillings of this debt.
Lizhong noted that the International Monetary Fund (IMF) assured him that Uganda has not reached a critical stage of default. He emphasized the need for financial reforms in the global market to enable developing countries to access credit for development.
Lizhong confirmed that China will continue to lend to African countries without strict conditions, focusing on promoting development projects and poverty reduction initiatives.
He also addressed allegations that Chinese companies are harming the environment in Uganda by establishing factories in wetlands. He condemned the practice and urged those with evidence to report such factories to the Chinese Embassy.
The ambassador highlighted that the new China’s policy that waved tarrifs on products from Africa has seen bilateral trade with Africa grow by 40% in the first Eight months with China trading goods worth $100 million in Uganda. Chinese companies have invested over $40 million in Uganda this year alone.
