Ethiopia debt woes curtail China funding

Chinese train masters look out from a train as they wait for passengers during the inauguration of the new train line linking Addis Ababa to the Red Sea state of Djibouti, in Addis Ababa, Ethiopia, October 5, 2016. REUTERS/Tiksa Negeri/File Photo

ADDIS ABABA/BEIJING (Reuters) – Ethiopia has been lauded by experts from China’s ruling Communist Party as a “model country” in Beijing’s $126 billion Belt and Road initiative to build rail, road and sea links tying China to Eurasia and Africa.

But as the Horn of Africa nation of 100 million people faces debt distress, there are signs that China, a major creditor, is slowing financing to Ethiopia as doubts grow over the profitability of some infrastructure projects there.

“The intensifying repayment risks from the Ethiopian government’s debt reaching 59 percent of GDP is worrying investors,” China’s mission to the African Union in Addis Ababa said on its website in July. Read more >>

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