China loans Bangui $2 million to pay civil servants

The Central African Republic has received a US $2-million interest free loan from the People's Republic of China, with which to pay September salaries for civil servants, a government official told IRIN on Monday. At the same time, the government has received a $1.68-million grant from Equatorial Guinea, which would also go to paying salaries, the director of cabinet at the prime minister’s office, Marcel Djimasse, said. Payment of the salaries begins on Tuesday, he said. Prime Minister Abel Goumba and Chinese Ambassador Wang Sifa signed the agreement for the loan on Monday in the capital, Bangui. This was the second time that China has given the CAR an interest-free loan since the 15 March coup that brought former army chief of staff Francois Bozize to power. China loaned the government $2.5 million in early June. It also granted $2 million in April, which enabled the government to pay civil servants their salaries for the month. In mid-September, China also gave a $83,000 grant for the national reconciliation forum that ended on 17 October. The latest loan comes when China has started building a 20,000-seat football stadium in Bangui, and is preparing to hand over to the government 100 low-cost flats it built in a Bangui suburb. "The funds granted by Equatorial Guinea have been at the Central Bank since last Friday," Djimasse said. He added that the government had paid the same day August salary arrears. Like other four member states of the Economic and Monetary Community of Central African States, Equatorial Guinea accepted on 2 June in Libreville, Gabon, to contribute 1 billion francs CFA ($1.8 million) for the reconstruction of the CAR, which has been ravaged by civil strife for many years. So far, Chad, Gabon and the Republic of Congo have made their contributions. Cameroon is yet to make its own. The Chinese loan and Equatorial Guinea’s grant came while the CAR government owed civil servants two months’ salaries, which it failed to pay because of a sharp decrease in the income generated from import and export taxes. The shortfall occurred due to a transportation hitch caused by heavy rains, that hindered the ferrying of goods across the country. Djimasse said that the funds, in addition to a €1 million ($1.14 million) grant from France in October, would enable the government to obtain the 2.7 billion francs CFA ($4.9 million) needed for each month’s salaries. On 29 October, Goumba asked Lebanese traders who collectively owed the government 1.5 billion francs CFA ($2.7 million) in taxes to meet their obligations to enable the government to pay civil servants' salaries. [see earlier IRIN story: Goumba summons Lebanese traders, asks them to pay tax arrears]