• He assured Kenya that the current trade dispute between his country and US Will not affect China-Kenya trade relation.
• Peng accused US based research and academic institutions for coming up with biased studies that always overstates China’s risk of lending.
Image: FILE
China has refuted claims that is dragging countries into debt trap to snatch their key assets.
Speaking at the Kenya Editors' Guild Press Club luncheon in Nairobi yesterday, Chinese ambassador to Kenya Wu Peng said that loan agreements between China and Kenya are in line with international best practice and are purely for development purposes.
"None of Kenya’s national assets has been mortgaged for the Standard Guage Railway (SGR) loan, neither would any single Kenyan national asset be seized nor controlled by China, even in a situation of default,’’ Peng said.
The Chinese envoy added that Chinese companies and banks, even the third party conducts rigorous feasibility studies, evaluation, and review of a country’s credit rating before making funding decisions.
His assertion perhaps puts to rest claims that Kenya gave out the Port of Mombasa to China Exim Bank as a collateral for SGR loans.
Kenya is however yet to make public the contractual agreement for SGR funding as promised by President Uhuru Kenyatta in December when he hosted journalists in Mombasa.
Peng accused US based research and academic institutions for coming up with biased studies that always overstates China’s risk of lending.
"As a matter of fact, no country has been trapped in a debt crisis due to its cooperation with China. If you don’t agree, please just give me one example,’’ he said.
‘’Among the 17 low-income African countries at risk of “debt distress”, a crowd of global banks and bondholders were involved. China was the single-largest creditor, but other lenders held the majority of the debt.
He defended China’s business activities in Kenya, saying that his country does not pursue a policy of trade surplus with Kenya but instead paying great attention to Kenya’s desire to expand exports.
"Deepening of mutual political trust, and expansion of all-around cooperation have pushed China-Kenya relations to the level of a Comprehensive Strategic Cooperative Partnership,’’ he said.
He indicated that China's non-financial direct investment in Kenya has recorded double-fold increase to about $520 million in 2018. Now we have over 400 Chinese companies in Kenya, creating thousands of jobs for local community.
He assured Kenya that the current trade dispute between his country and US Will not affect China-Kenya trade relation.
‘’China will not allow Kenyan friends to get caught in the middle of US-China trade frictions. We always open for talks but it would fight to the end should a “trade war” break out,’’ he said.
On Monday, Kenya, which hosts the regional office for phone maker Huawei was in dilemma after Google announced cuts with the Chinese firm on President Donald Trump’s policies.
Huawei’s regional communication head Adam Lane however indicated that trade restrictions will not hurt the firm’s operations in the country or anywhere in the world.
US has since relaxed restrictions against the Chinese firm.