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Finance Africa’s second largest oil producer has secured a $2 billion loan from China

President João Lourenço secures $2 billion in Chinese financing from the China Development Bank for infrastructure projects.

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Africa’s second largest oil producer has secured a $2 billion loan from China play Chinese Premier Li Keqiang, right, shakes hands with Angolan president Joao Lourenco, left, berore a meeting at the Great Hall of People in Beijing, China on Tuesday October 9, 2018. (Daisuke Suzuki/Pool/via Reuters)

The Chinese government has extended its financial muscle in Africa by offering the continent's second-largest oil producer, Angola, a $2 billion loan.

Reuters quoting Angola’s state newspaper Jornal de Angola reported that President João Lourenço has secured $2 billion in Chinese financing from the China Development Bank for infrastructure projects.

President Lourenço ended his first visit to Beijing, China, on Wednesday, October 10, 2018, at the invitation of Chinese President Xi Jinping.

Like Nigeria, Angola is trying to diversify its economy away from oil since the global drop in the price of crude oil in 2014.

The fall in oil price plunged nations relying on crude oil into recession including Angola. The new loan is coming at a time international communities are expressing concern over China's debt trap.

Angola owes China more than $21 billion

Angola's debt profile is estimated to rise to $77.3 billion by the end of 2018. Of that amount, $21.5 billion was already owed to China before the latest loan.

IMF says Angola economy will contract by 0.1% in 2018

The International Monetary Fund (IMF) has also predicted that the Angolan economy will contract by 0.1% this year due to poor economic performance.

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