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Congo’s $20 Billion Dilemma

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Congo’s $20 Billion Dilemma

Posted by John Norris on February 10, 2009

Congo's $20 Billion Dilemma

A very interesting piece in the Financial Times on Congo, China and western aid. Apparently, some of the clauses written into the nine billion dollar mineral deal between China and Congo have led the IMF and the World Bank to insist that 11 billion dollars in debt relief for Congo cannot go forward unless sections of the deal are changed. In particular, the deal with Beijing gives China sweeping financial guarantees, including through earmarks of state revenues. The deal was struck before the global economic crisis, and a sharp tumble in both commodity prices and China’s demands for these resources. As one anonymously cited economist in Kinshasa observed, “The Congolese government has bet on [both] China and the IMF and now they’re in danger of losing both.”