Brazil to write off USD 900m in debt for Africa


Brazil is about to pardon the debts of 12 African countries after creating an agency to support development on the continent. The country plans to cancel or restructure USD 900m worth of debt for these nations as part of a broader strategy to boost its ties with the continent.
Brazilian officials said that President Dilma Rousseff, who is on a visit to the Ethiopian capital Addis Ababa to mark the African Union’s 50th anniversary, was set to announce the creation of a new development agency, alongside the cancellation, that will offer assistance to African countries.
“The idea of having a special relationship with Africa is strategic for Brazil’s foreign policy,” Thomas Traumann, the presidential spokesman, told reporters in Addis Ababa. He added that Brazil recently established an agency to support investments in industry and development in Africa and Latin America.
Among the 12 countries whose debts are to be written off is the Republic of Congo, with the highest debt at USD 352 million and Tanzania being the second largest, with a debt of USD 237 million. Rousseff met with several African leaders, including Ethiopian Prime Minister Hailemariam Desalegn, with whom she signed a series of cooperation agreements on agriculture, education, air transport and science.
Brazil’s interest in Africa is part of a larger trend boosting so-called South-South cooperation, which has attracted investment from emergent economies in developing countries, namely in Africa.
Brazil, one of five members of the BRICS emerging nations group with a GDP of USD 2.425 trillion in 2012, is the world’s seventh largest economy.
The BRICS countries – comprising Brazil, China, India and Russia – are now Africa’s largest trading partners and its biggest new group of investors. BRICS – Africa trade is expected to exceed USD 500 billion by 2015, according to Standard Bank.