Brazil 'to write off' almost $900m of African debt

 
Brazilian President Dilma Rousseff (L) greets Egyptian counterpart Mohammed Morsi (R) at the AU summit Brazil's President Dilma Rousseff (L) wants to boost trade with Africa

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Brazil has announced that it will cancel or restructure almost $900m (£600m) worth of debt with Africa.

Oil- and gas-rich Congo-Brazzaville, Tanzania and Zambia are among the 12 African countries to benefit.

The move is seen as an effort to boost economic ties between the world's seventh largest economy and the African continent.

Official data in Brazil show that its trade with Africa has increased fivefold in the past decade.

The debt announcement was made during the third visit in three months to Africa by Brazil's President Dilma Rousseff, who attended the African Union summit in Ethiopia.

'Strategic'

"Almost all (aid) is cancellation," Ms Rousseff's spokesman, Thomas Traumann, told reporters.

"To maintain a special relationship with Africa is strategic for Brazil's foreign policy."

He added that most of the debt was accumulated in the 1970s and had been renegotiated before.

A spokesman for Brazil's Foreign Ministry told Efe news agency that the debt restructuring for some countries would consist of more favourable interest rates and longer repayment terms.

Congo-Brazzaville owes the most to Brazil - $352m - followed by Tanzania ($237m) and Zambia ($113.4m).

The other countries to benefit are Ivory Coast, Gabon, Guinea, Guinea Bissau, Mauritania, Democratic Republic of Congo, Sao Tome and Principe, Senegal, and Sudan.

Resource-hungry

Brazil has been increasingly expanding its economic ties with resource-rich Africa as part of the so-called South-South cooperation.

Trade between the two blocks went from $5bn (£3.3bn) in 2000 to $26.5bn (£17.5bn) in 2012.

Bulldozer loads lorry in the Brazilian mining giant Vale's coalmine on the outskirts of Tete province, Mozambique, 8 November 2010 Trade between Brazil and Africa has grown fivefold in the last decade, fuelled by South America's hunger for natural resources

Brazilian companies invest heavily in oil and mining in Africa, and have taken on big infrastructure projects.

Latin America's economic powerhouse has also opened 19 new embassies in Africa in the last decade, and is forecast to grow 3.5 percent this year.

But Brazil's hunt for natural resources has not always been easy in Africa.

Last month, hundreds of protesters in Mozambique blocked the entrance to a Brazilian coal mine in a row over a compensation deal agreed after they were displaced.

Human Rights Watch, a rights group, said farming communities had been resettled on arid lands and had suffered food shortages.

The Brazilian giant Vale, which owns the mine, and the government of Mozambique said improvements were being made.

 

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  • Comment number 99.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    +3

    Comment number 98.

    Over 50 years ago I saw thousands of tons of grain in sacks on the dock in Karachi, "Hands across the Sea" US aid, trouble was millions of rats were eating it in broad day light. there was no transport available to get the food where it was needed, but Pakistan was considered politically reliable, India was not considered reliable & millions were starving there. Today India thrives, strange eh!

  • rate this
    0

    Comment number 97.

    @24. NOTMEAGAIN
    "I'd happily fork out for a box of matches to burn the bonds with"

    Doing the math, it's cost every UK worker (almost 30 million of them) around £30 to write off £1 billion worth of foreign debt.

    Apply that to every £1 billion we are owed and then tell me you're happy to take the hit personally.

  • rate this
    +2

    Comment number 96.

    Africa really does not need these handouts. What Africa needs is trade and not aid. Africa has plenty of hard working people and a lot talent. all this needs to be used and Africa will prosper without such piety.

  • rate this
    -19

    Comment number 95.

    Until professor James Watson's research and conclusions are taken seriously, Africa cannot be helped.

    Look at the cause.....and it isn't 'warlords'

  • rate this
    +1

    Comment number 94.

    One has to wonder if eventually Britain will go to Brazil for loans. Their economy, focused on actually manufacturing goods, has already surpassed Britain's financial speculation-focused economy in size.

  • rate this
    +1

    Comment number 93.

    To cancel the debt of African countries does not improve the lot of African people, it only increases the amount of money that elites and governments can take for themselves or spend on military equipment. It doesn't improve literacy, life expectancy or maternal survival rates; it merely increases the number of ferraris and swimming pools of politicians.

  • Comment number 92.

    All this user's posts have been removed.Why?

  • Comment number 91.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    +1

    Comment number 90.

    @ 61.plotinus
    You would hope so, but given some countries have records of hijacking UN aid convoys while others have suffered the horrors of genocide and open warfare between governments and rebel factions, there is no guarantee. Australia is a different world...

  • rate this
    -22

    Comment number 89.

    I wouldn't let them off for a penny.

    Africa: The worlds council estate. Lazy ne'er do wells that just keep on taking.

    We've looked after Africa long enough now. Didn't mankind begin in Africa? Wouldn't think it would you?

  • rate this
    +22

    Comment number 88.

    Usual uninformed steel hearted smuggarts going on about dictators siphoning off money, it is simply not accurate in a lot of cases.

  • rate this
    +18

    Comment number 87.

    84. Sally
    "South Korea"
    Actually South Korea was a massive recepient of aid - the US providing it alone in 1946 to 1978 almost as much aid as it provided to the whole of Africa in the same period. Japan and others e.g. UN et al also provided massive amounts. True the Korea Government did use it wisely, even going against US/foreign advice on restructuring. But foreign aid fuelled the growth etc.

  • rate this
    +4

    Comment number 86.

    And then Brazil will turn around and ask for cheap loans from the World Bank & IMF- marygoaround! - Swiss Bank and French real estate - here we come!
    Loosers the poor: No water-food-jobs-schools-health care etc.

  • rate this
    +2

    Comment number 85.

    Last BRIC Summit - focused on Africa. AU wants to unify continent by establishment of one currency & development fund to bypass punishing IMF & WB; & by establishment of security/defense organizations = less old-style western imperialism, reducing exploitative foreign economic activity & side-stepping forces like US African Command (AFRICOM).
    Looks like Brazil is putting teeth to BRIC Summit.
    .

  • rate this
    0

    Comment number 84.

    79.JasonEssex
    I couldn't agree more.
    1'st of all, to me at least, foreign aid is taking money from poor people here, to give to wealthy ruling elites in poor countries. This to me is immoral.

    2nd. I 100% agree! Free trade is the best solution. It worked for Hong Kong, and South Korea, look at their wealth now!
    Poor people, and poor countries, don't need a hand out, they need a hand up.

  • rate this
    +12

    Comment number 83.

    78. starfish
    A lot of the debt was due to bad lending decisions by banks, who awash with cheap money did not consider how it would be paid back - like sub-prime. Also some countries were lent money during the cold war as they were on the "right side". Latin American dictatorships left democratic governments debts, a lot to the USA which helped arm these anti-communist dictatorships for example.

  • rate this
    +3

    Comment number 82.

    These words say it all "Oil- and gas-rich" no flys on brazil then !

  • rate this
    +1

    Comment number 81.

    Obviously the vast majority of countries are in debt, but in debt to whom? Some of this money is surely owed to China, I suggest we pay this back ASAP, the rest is probably owed to banks that we should tell to get stuffed, after all what could the banks do if every country on earth told them to do one?

  • rate this
    -1

    Comment number 80.

    Hear hear to brian24001.

 

Page 13 of 17

 

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