Biden, Kenyan leader urging global leaders to help lessen crushing debt on developing nations

WASHINGTON — WASHINGTON (AP) — President Joe Biden and Kenyan President William Ruto are using the first state visit to the United States by an African leader in more than 15 years to call on economies around the world to take action to tackle the massive debt burden crushing Kenya and other developing countries.

The call to action, dubbed the Nairobi-Washington Vision, comes as Biden reiterates his appeal to African countries that the US can be a better partner than economic rival China. Beijing has increased its investments on the continent – ​​often with high-interest loans and other difficult financing conditions.

Biden and Ruto want creditor countries to reduce financing barriers for developing countries constrained by high debt burdens. They also call on international financial institutions to coordinate debt relief and support through multilateral banks and institutions that offer better financing conditions.

“Together, we will call on the international community to come together around these elements to support high-ambition countries with high-ambition financial assistance,” the White House said in a fact sheet describing the effort.

The White House also announced $250 million in grants for the International Development Association, part of the World Bank, to help poor countries facing crises.

In addition, a $1.2 trillion bill passed by Congress in March allows the U.S. to lend up to $21 billion to an International Monetary Fund Poverty Reduction and Growth Trust, which provides zero-interest loans to support low-income countries in their strive for stabilization. strengthen their economies, boost growth and improve debt sustainability. This financing is expected to be made available to the IMF in the coming weeks.

Biden and Ruto will hold formal talks and a joint press conference on Thursday ahead of a state dinner at a pavilion on the South Lawn of the White House.

An Associated Press analysis of a dozen countries most indebted to China — including Pakistan, Kenya, Zambia and Laos — shows that these debts are consuming an increasing amount of tax revenue needed to keep schools open and provide electricity. and pay for food and fuel.

Behind the scenes, China’s reluctance to forgive debts and its extreme secrecy about how much money it has lent and on what terms has deterred other major lenders from stepping in to help.

Kenya’s debt-to-GDP ratio is over 70%, and most of that is due to China. Credit rating agency Fitch estimates that Kenya will spend almost a third of its government revenue solely on interest payments this year.

Ruto said on Wednesday that his talks with Biden will be about “how we can have a fairer international financial system where all countries are treated equally.”

Biden also informed Congress on Thursday that he will designate Kenya as a major non-NATO ally, the White House said

The designation, while largely symbolic, reflects how Kenya has grown from a regional partner that has long cooperated with US counter-terrorism operations on the continent to a major global influence – even expanding its reach into the Western Hemisphere. Kenya will be the first sub-Saharan country to gain this status.

Kenya is expected to soon send a thousand police officers to Haiti to quell the gang violence that has been plaguing the Caribbean country for months. The Biden administration has praised Kenya for stepping up in Haiti when so few other countries have declined to do so. Haiti is the poorest country in the Western Hemisphere and has been mired in political instability and natural disasters for decades.

The US has pledged $300 million in financial support for the mission in Haiti, including support from the Bahamas, Barbados, Benin, Chad and Bangladesh. Ruto is expected to discuss the upcoming mission during his talks in Washington with Biden, Defense Secretary Lloyd Austin and other officials.

Ruto arrived in Washington on Wednesday and started his three-day state visit with a meeting with Biden and technology executives from Silicon Valley and Kenya’s growing technology sector known as the Silicon Savannah.

Government officials said several private sector investments are expected to be announced during the visit. The Kenyan president told the tech executives that Kenya – and Africa more broadly – ​​has a young, innovative population that is “hungry for opportunity.”

“I think we have a historic moment to explore investment opportunities between Kenya and the United States,” Ruto said.

Biden gathered dozens of African leaders in Washington in December 2022 to advocate that the United States was “all in” for Africa’s future under his watch. He has committed billions in promised government funding and private investment to the continent in healthcare, infrastructure, business and technology. The Democrat also promised to visit the sub-Saharan part of Africa in 2023.

But other priorities got in the way last year, including the war between Israel and Hamas and Biden’s long battle with Republicans to renew funding for Ukraine in its war with Russia. Biden’s promised visit to Africa never materialized. Biden, who faces a tough re-election battle in November, said in a call with reporters as Ruto arrived at the White House on Wednesday that he still plans to go to Africa.

“I plan to run in February after I am re-elected,” Biden said.