Brazil to cancel or restructure almost $900m of African debt
Brazil will cancel or restructure almost $900m in debt owed by African countries, a Brazilian official said, as part of a plan to increase future funding to the continent.
Latin America’s economic powerhouse is expanding its economic ties with Africa, a sign of how crises in richer countries are pushing faster-growing emerging economies to trade and invest among themselves, economists say.
Brazilian officials said President Dilma Rousseff, visiting Addis Ababa to mark the African Union’s 50th anniversary, was set to announce a development agency alongside the cancellation that will offer assistance to African countries.
“Almost all (aid) is cancellation,” Thomas Traumann, spokesman of Brazil’s presidency, told reporters in the Ethiopian capital.
Under Brazilian law, Brasília cannot offer new loans and long-term financial assistance to countries with outstanding debts. Mr Traumann said most of Brazil’s future assistance would target infrastructure, agriculture and social programmes.
Among the 12 countries set to benefit areTanzania, which owes Brazil $237m, along with oil-producing Republic of Congo and copper-rich Zambia.
Most of the debt was accumulated in the 1970s and had been renegotiated previously, Traumann added.
“Brazil has great expertise in what we call tropicalising European crops. We have that technology,” he said. “The idea is how to transfer that technology from Brazil to other African countries.”
In a sign of Brazil’s quest for deeper ties with Africa, Ms Rousseff was making her third visit to the continent in as many months, Mr Traumann added.