Centre warns against implications of unpaid Chinese loans on maritime assets

Amid the $2bn Nigeria, China Currency swap deal, the Sea Empowerment Research Center has warned that many countries have had to forfeit national assets, including maritime assets, following their inability to repay loans borrowed from the Chinese government.

In a statement signed by the Centres’ Head of Research, Eugene Nweke, such countries include Angola, Kenya, Sri Lanka amongst others.

According to Nweke, “As Nigeria goes ahead with the $2bn currency swap deal with China, we wish to note that it’s no longer secret that China has been investing heavily in various countries around the world, particularly in Africa, through its Belt and Road Initiative, and this has led to forfeiture of assets by many countries indebted to the Chinese government.

“In specific terms, let us take a look at some of the countries that have found themselves in this situation: Angola owes China a whopping $25billion, and as a result, China has gained significant control over Angola’s oil industry.

“Kenya, another country presently struggling to repay its loans to China has ceded control of its Standard Gauge Railway project to the Chinese government.

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“Sri Lanka has also had to hand over control of its Hambantota por to China due to debt repayment issues.

Other countries that have had to cede control of their economic resources and “infrastructures to China include Djibouti, which has had to give China control of its Doraleh Container Terminal, and Uganda, which has had to hand over control of its Entebbe International Airport.

“Zambia has also had to give China control of its Kenneth Kaunda International Airport, and Nigeria has had to tacitly cede control of its Lekki Deep Sea Port in same regards via share interest stakes in the Concession deal.

“It’s worth noting that these takeovers are often the result of debt-for-equity swaps, where China agrees to cancel some of the debt owed by the country in exchange for control of strategic assets. This can be a contentious issue, as it often involves China gaining control of critical infrastructure and resources in the country.

“According to various reports, at least 10 African countries are at risk of having their economic resources and infrastructures taken over by China due to debt repayment issues. These countries include Republic of Congo, Sudan, Cameroon, Ghana, and Democratic Republic of Congo, among others.

From the periphery and in short terms approach, the China-Nigeria currency swap deal has the potential to enhance trade and investment between the two nations, but with a deeper, critical look and reasoning, it also poses some challenges and risks that need to be carefully reevaluated and managed.