When Tanzania president publicly cancelled a $10 billion Chinese loan, describing its terms as something “only a drunkard could accept,” the statement sent shockwaves across Africa and beyond.
At a time when many African nations were deeply entangled in Chinese-funded infrastructure projects, Tanzania’s bold rejection stood out as a rare act of political defiance. Was President John Magufuli a demigod, or was African leadership finally waking up to the dangers of what many now call Chinese killer loans?
This article breaks down what happened, why the loan was cancelled, and what it signals for Africa’s future.
Africa’s Obsession With Chinese Loans
For years, African governments developed an aggressive appetite for large Chinese loans—often signed behind closed doors.
These agreements typically came with:
- Unrealistic repayment timelines
- Opaque terms and conditions
- Excessive control handed to foreign investors
- Long-term leases that compromised national sovereignty
Despite knowing the financial risks, many leaders still signed these deals—often driven by kickbacks, political gains, and personal interests, rather than national development.
When countries eventually defaulted, the consequences were severe:
Ports, airports, power plants, and strategic assets were seized or controlled by foreign entities.
Public Outcry and a Shift in African Consciousness
As civil society organizations, economists, and citizens became more informed, pressure mounted on African leaders to reassess these agreements.
For the first time in decades:
- Governments began questioning Chinese terms
- Leaders demanded renegotiations
- Some contracts were suspended or cancelled
The Tanzanian president emerged as one of the most vocal figures in this shift.
Why the Tanzania President Cancelled the $10 Billion Loan
The cancelled loan was signed under former President Jakaya Kikwete, aimed at constructing a massive port at Mbegani Creek in Bagamoyo, north of Dar es Salaam.
The Shocking Loan Conditions
Chinese investors demanded:
- A 99-year uninterrupted lease
- A 30-year guaranteed operational control
- Zero authority for the Tanzanian government to question or approve investors
- No power for Tanzania to regulate activities at the port
According to President Magufuli, such conditions were economically and politically absurd.
He openly stated that only mad or drunk people could agree to such terms.
Magufuli’s Renegotiation Efforts
Instead of accepting the deal blindly, the Tanzanian president:
- Proposed reducing the lease from 99 years to 33 years
- Refused tax and utility exemptions for investors
- Demanded government approval for all new businesses at the port
- Set strict deadlines for renegotiation
When the investors failed to comply within the given timeframe, the government suspended and eventually cancelled the agreement.
Tanzania Was Not Alone
Tanzania’s move was part of a growing African resistance against exploitative contracts.
Other Notable Examples
- Sierra Leone (2018): President Julius Maada Bio suspended a $400 million Chinese-backed airport project, citing economic irrationality.
- Kenya: Cancellation of a $2 billion coal power plant due to environmental and financial concerns.
- Other African states have quietly stalled or reviewed Chinese-funded projects.
These actions signaled a shift from blind borrowing to economic realism.
Is Africa Still Taking Chinese Loans?
Yes—some countries continue signing such agreements, often without public scrutiny.
However, the consequences of these deals are becoming more visible, and citizens are increasingly demanding transparency and accountability.
The era of unquestioned Chinese financing is slowly coming to an end.
What This Means for Africa’s Future
The bold stance taken by the Tanzania president serves as
- A warning against neo-colonial debt traps
- An encouragement for African leaders to prioritize sovereignty
- A reminder that development must be mutually beneficial, not exploitative
Africa does not need to reject foreign investment—but it must insist on fair, transparent, and sustainable terms.
Conclusion
The cancellation of the $10 billion Chinese loan by the Tanzania President was more than a political decision—it was a statement.
It proved that African nations can say no, renegotiate unfair contracts, and protect their long-term interests. Whether this moment marks a permanent shift or a temporary rebellion depends on how other leaders respond.
One thing is clear:
Africa is watching, questioning, and slowly waking up.
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