#Adesina criticizes #opaque #loans linked to #Africa's #resources
The head of the #African #Development #Bank is calling for an end to loans given in exchange for the continent's #rich #oil #reserves or essential #minerals used in #smartphones and #electric car #batteries.
This type of #borrowing has plunged many #African #countries into a #financial #crisis.
“They're just bad, first and foremost, because you can't value assets properly,” #Akinwumi Adesina said in an interview with The Associated #Press in #Lagos, #Nigeria, last week.
"If you have #minerals or #oil under the ground, how do you find a #price for a long-term #contract? It's a challenge," he explains.
Linking future revenues from #natural #resource #exports to loan #repayments is often presented as a way for recipients to obtain f#inancing for #infrastructure #projects and for lenders to reduce the #risk of not getting their money back.
The shift to #renewable #energy and #electric #vehicles has caused a spike in demand for essential minerals, which favors this type of lending. The agreement between #China and the #Congo illustrates this well. Beijing thus exploits the world's largest #reserves of #cobalt, a mineral used to #manufacture #lithium #batteries.
French https://fr.africanews.com/2024/03/12/adesina-critique-les-prets-opaques-lies-aux-ressources-de-lafrique/
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