2 Apr. (EUROPE PRESS) –
The president of the International Monetary Fund (IMF), David Malpass, has affirmed that he looks with “concern” at the bank credit concessions that China has granted to several African countries.
In an interview with the British BBC radio-television network, Malpass has stated that the terms and conditions of these loans must be “more transparent”, amid reports that countries like Ghana and Zambia are having problems repaying the borrowed money.
Many countries with fragile developing economies accept loans from other nations or from international organizations, but rising interest rates in the past year mean many of them are having trouble repaying them.
For Malpass, it is especially difficult to find that extra money in an economy whose currency is constantly devaluing, which causes a “double whammy, and means that (economic) growth is going to be slower.”
“What I especially recommend is that they be transparent in the contracts. That has been one of the problems, if you write a contract and it says ‘but don’t show it to anyone else’, that’s a negative point, you have to stay away from that.” , has added.
In the case of loans granted by China, he pointed out, African governments are “offering guarantees as incentives to get a loan”, something they should not do because “it blocks (the issue) for generations.”
These financing problems, Malpass points out, are not exclusive to the Asian giant: “If you look at the history of Western loans, sometimes it is not for the benefit of people in other countries. Even IMF credits have not always been the best thing that could be done for a country”.
“So what we’re trying to do, and what I think everyone should try to do, is improve the quality of these loans,” he concluded.