China announced the cancellation of accumulated interest payments on all the loans it provided to Ethiopia until the end of last year, according to Ethiopia prime minister’s office.
The announcement was made by President Xi Jinping during his meeting with the Ethiopian Prime Minister Abiy Ahmed in Beijing. During the meeting, the two leaders also discussed the rising concerns facing China’s Belt and Road Initiative.
Last year, China had agreed to revise some of the loans it provided to Ethiopia. Since 2000, Ethiopia has borrowed loans worth more than $1.2 billion from China, which included loans for the funding the Addis Ababa-Djibouti railway line that connects the country to its main port in Djibouti.
President Xi stressed on the fact that the Chinese government is eager to work on the Beautifying Sheger project in Addis Ababa which is worth more than $1.1 billion. The country is investing a lot of effort to complete the project.
Both leaders have agreed to strengthen cooperation between the two countries. In 2017, Ethiopia and China formed an agreement to build a comprehensive, strategic partnership across various fields.
China’s write off of Ethiopian loan interest payment is not the first time it has excused debt payments for debtors in Africa. In January 2019, China wrote off off nearly $78 million from Cameroon’s debt in an effort to ease the economic conditions in the central African nation.