China forgives $5 million of country's debt

Pulse Staff 16:11 - 14 June 2016

Chinese President Xi Jinping (R) and Mozambican President Filipe Nyusi shake hands at a signing ceremony at the Great Hall of the People in Beijing, China, May 18, 2016.

Mozambique is facing an economic crisis after it's officials admitted in April to the International Monetary Fund that the southern African nation had large of amounts hidden debt

China will forgive 30 million yuan ($5 million) of Mozambique's debt under an agreement signed by officials from both countries, the southern African nation's state news agency reported on Tuesday.

The debt cancelled was part of a Chinese loan bearing no interest, the agency said.

Mozambique is facing an economic crisis after it's officials admitted in April to the International Monetary Fund that the southern African nation had large of amounts hidden debt, causing many funding organisations including the United States and the World Bank to review loans to the cash-strapped country.

($1 = 6.5905 Chinese yuan renminbi)