– China red-faced Sierra Leone, one of the world’s developing countries, has scrapped plans to build a China-funded $318-million airport outside the capital, Freetown.
This is the first instance of an African country announcing the cancellation of a China One Belt One Road project. The World Bank and the International Monetary Fund (IMF) both warned earlier that this project may bring an unnecessary debt burden to Sierra Leone.
The mega-project, which was due to be completed in 2022, had been commissioned by former Sierra Leone president Ernest Bai Koroma. But the new president, Julius Maada Bio, has since reassessed the huge loans offered by China to his predecessor.
Under former president Koroma, who was in office from September 2007 until April this year, the country took on $224 million of Chinese debt — $161 million of which was borrowed in 2016 alone, according to the Johns Hopkins SAIS China-Africa Research Initiative.
“After serious consideration and diligence, it is the Government’s view that (it) is uneconomical to proceed with the construction of the new airport when the existing one is grossly under utilized,” said a letter from the country’s Minister of Transport and Aviation to the project’s director, published in local media.
African countries jointly owe China about $130 billion, according to the China-Africa Research Initiative. This amount has funded transport, power and mining projects in the resource rich continent.
At this year’s Forum on China-Africa Cooperation (FOCAC) summit, Chinese President Xi Jinping announced a further $60 billion in loans and aid for the continent.
“Countries around the world are now rethinking the readily available loans offered by China for infrastructure projects in their countries, after fearing they could fall prey to Beijing’s debt-trap diplomacy…China funded projects also require the hiring of Chinese-owned contractors rather than local companies and workers. Chinese loans, with interest rates of 2-3 per cent, are 1,100 per cent more expensive than those from Japan, at only 0.25-0.75 per cent,” reports Philippine Daily Inquirer.