Reprieve for Rwanda as China cancels $7.1 million debt

China has offered Rwanda a $7.1 million debt relief or 50 million RMB Yuan on a loan used to build the 6.36-kilometre Masaka-Kabuga road under the Kigali urban road upgrading project.

According to a statement issued by Rwanda, the move is part of the Chinese government’s decision to cancel the outstanding interest-free loan by the agreement on economic and technical cooperation between the two countries.

“The two countries enjoy a healthy bilateral cooperation. This is evidenced by the substantial contribution of the Republic of China towards Rwanda’s development aspirations. The agreement we signed today cements this relationship,” Rwanda’s Minister for Finance and Economic Planning Uzziel Ndagijimana said on Monday after signing the debt cancellation agreement. China was represented by its ambassador to Rwanda Wang Xuekun.

Strong economic cooperation

Dr Ndagijimana acknowledged the strong economic cooperation between the two countries which has seen Rwanda benefit from China’s support in various sectors including infrastructure, energy, education and health.

China says the debt cancellation is part of the economic package announced by President Xi Jinping at the 8th Ministerial Conference of the Forum on China-Africa Cooperation.

“China hopes, by offering this financial support, to make a contribution to Rwanda’s all-round transformation and recovery from the malign impact of the Covid-19 pandemic. In the future, China will work with Rwanda for deeper practical cooperation in various fields under the Belt and Road Initiative framework to deliver more benefits to the two peoples,” Wang said in a statement.