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China grants Cuba debt relief, new funds

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China has agreed to restructure Cuban debt and provide new trade and investment credits to the beleaguered Caribbean Island nation after a meeting in Peking between the two Communist countries’ leaders.

“We are going to find mutually acceptable formulas for the ordering and restructuring of debts,” Cuba Economy Minister Alejandro Gil said.

Gil said China has also donated $100 million to help the country cope with basic goods shortages and an energy crisis worsened by Hurricane Ian, which decimated western Pinar del Rio province in late September.

Gil was speaking in an interview with official media traveling with President Miguel Diaz-Canel as he returned home over the weekend from a tour of Algeria, Russia, Turkey and China.

President Diaz-Canel told the official media after talks in Peking that debt was at the top of his agenda with President Xi Jinping who sympathized with the difficulties Cuba was going through.

The Cuban president said his Chinese counterpart indicated “a solution must be found to all the problems with Cuba, regardless of the debt, and that this cannot be what limits development.”

Chinese trade and investment has slowed in recent years due to Cuba’s failure to meet restructured debt payments according to analysts and diplomats, a situation worsened by tighter U.S. sanctions, the pandemic and domestic economic inefficiencies.

Also Read: China mulls holding Belt & Road Forum in 2023

Analysts estimate the debt in the billions of dollars, although no official figures are available. Cuba last reported its foreign debt in 2019 at $19.6 billion.

China is Cuba’s most important commercial partner after Venezuela, though trade has declined from over $2 billion in 2017 to $1.3 billion last year, according to the Cuban government.

Various investment projects have also ground to a halt. Gil said China had agreed to quickly complete a floating dock, wind power and solar energy project, among others.

 

Reuters/Zainab Sa’id

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