Both Houses of the Parliament have ratified a Complementary Agreement on the Restructuring of Congo's debt to China by 1, 479.83 billion FCFA.
17 May, 2019
Unanimously passed, Friday 17 May 2019 by the National Assembly, and Monday 20 Mai 2019 by the Senate, the two Houses of the Congolese Parliament have ratified, after review, the Draft Law of the Complementary Agreement on the Restructuring of the Congo's Debt to China, signed on 29 April 2019 in Beijing, between the Republic of Congo and the Import-Export Bank of China. The discussions were conducted by the Speakers of both Houses, namely: Isidore Mvoumba and Pierre Ngolo.
As of March 2019, Congo's debt to China is 1,479.83 billion FCFA. It breaks down as follows: Strategic partnership (1,304,73 billion FCFA), of which 944,13 billion FCFA for the balance of the block of 8 restructured loans (or 1612,33 billion USD). Preferential loans: 299.03 million USD or about 175.10 billion FCFA.
According to the Minister of Finance and Budget, Calixte Nganongo, the Complementary Agreement does not cover all Congo's debt to China, but the loans contracted with Exim Bank, which concerns 8 credit contracts concluded between Congo and the Import-Export Bank. These include: rehabilitation of the Djiri water unit, construction project of reservoirs and installation of drinking water distribution network, project for the development of and upgrading of the section of the National Road N0. 1, Dolisie-Brazzaville, Liouesso hydoelectric dam project ; project for the construction of a shopping centre in Brazzaville, Mpila social housing construction project, Mpila commercial zone construction project, Mpila memorial construction project.
For the 8 projects, according to the government member, subject of the restructuring, the terms of the initial contracts can be summarised as follows: -Credit: 85 per cent of the cost of the contract amount;
-Congo’s consideration 15 per cent;
Grace period: 3 to 5 years, depending on the duration of the works;
Duration of repayment: 10 to 15 years.
The Complementary Agreement is one of the prerequisites for concluding discussions with the International Monetary Fund (IMF), with a view to concluding a programme supported by an Extended Credit Facility. A significant portion of the debt is with China. For example, Congo has initiated discussions on China's financing assurances during the period of the Programme with the IMF and the rescheduling of debt maturities.
