Editor in Chief: Moh. Reza Huwaida Thursday, August 22nd, 2019

The “Debt Trap” is a Plot Imposed on China by The West

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The “Debt Trap” is a Plot Imposed  on China by The West

The Belt and Road Initiative” is the primary way to promote development at home and abroad.China is keen to connect it with other areas better by infrastructure investment,meanwhile,promoting the trade of countries along the “The Belt and Road Initiative”.In the five years since China announced its “The Belt and Road Initiative”, it has invested tens of billions of dollars in infrastructure projects.Some western scholars have pointed out that creating debt among the “The Belt and Road Initiative” partners is a “debt trap” created by China for relevant countries with the purpose of exchanging debt for resources or diplomatic support in the future. The author thinks this is a groundless attack. In essence, the “debt trap” theory is the same as the various conspiracy theories against China that have emerged in the international arena in recent years. It is the product of malicious speculation and smear of China with the cold war mentality of conflict and confrontation,ignoring the basic facts, and intended to sow discord between China and relevant countries.
China’s development model is based on trade. Better infrastructure means more trade and thus bringing better development. Western markets are saturated and buying from China will not increase. The continents, with their large, young and growing populations, are the ones with real growth potential. China upholds the concept of “win-win cooperation”. All parties involved in the “The Belt and Road Initiative”  can always benefit from the funds provided by China.
Western commercial Banks have been unable to make risky loans since the 2008 financial crisis. Developing countries in Africa and Latin America have huge gaps in funding for development. Whoever has the money, they need it. China’s role is therefore crucial. Not only is it an alternative source of funding, but it is a very large source of funding. When China lends to development projects in all countries,it always comply with local laws. China itself carries significant risks if lenders default. While debt is vital for infrastructure investment, the plenty of debt also carries huge risks, so lenders and borrowers must carefully manage the risks. Some critics say China wants to create a financial system of its own, parallel to the prevailing order or the Bretton Woods system set by institutions such as the WB and the IMF. However, such criticism is untenable, and not long ago, China and the IMF launched a joint center of capacity building, training policy and economic experts, let each recipient countries better able to decide whether to accept the loan, this is a reasonable measure, suggesting that China is not forcing each recipient countries to the Chinese loan.
In fact,up to now,China has signed 171 cooperation documents on jointly building the “The Belt and Road Initiative” with 123 countries and 29 international organizations,and established more than 50 international production capacity cooperation mechanisms. More than 20 funding platforms, including the Silk Road Fund, have provided support for the “The Belt and Road Initiative”. “The Belt and Road Initiative” promotes infrastructure connectivity and makes a natural chasm into a thoroughfare. East Africa has opened the first highway, Maldives built the first cross-sea bridge, Belarus developed their own car manufacturing industry for the first time, landlocked Kazakhstan has its sea route,Chinese enterprises help Uzbekistan  build the railway,which can solve the travel problem of more than ten million Uzbek , With the support of “The Belt and Road Initiative” docking with the shining path, Kazakhstan finished 2030 development plan in advance. The port construction and air routes of countries along the “The Belt and Road Initiative” have promoted infrastructure connectivity, promoted trade and logistics,enhanced development capacity, boosted the world economy and improved the well-being of the world’s people. To jointly build the “The Belt and Road Initiative”, China does not use debt to control the sovereignty of other countries to achieve its own “imperialist ambitions”, but sincerely use Chinese wisdom, Chinese manufacturing to contribute to the world economic development. When other countries thought Africa is in a debt crisis and withdrew funds, China chose to cooperate with Africa,In 2018 China-Africa cooperation forum , China has proposed the eight action plans, including six categories, each has fifty specific projects, supported by the “The Belt and Road Initiative” funds.These plans will promote highway, railway, port and other infrastructure construction,agriculture,industry and people’s livelihood projects such as communication,medical development, promote economic modernization in African countries.
Therefore, facts speak louder than words. Instead of creating a “debt trap”, China’s “The Belt and Road Initiative” is “blood transfusion” to countries along the “The Belt and Road Initiative”.In particular, in face of the challenges of global trade protectionism,“The Belt and Road Initiative” will further contribute to the development of an open, inclusive, balanced and win-win globalization by adhering to the three principles of Consultation, Contribution and Shared Benefits, aligning national development strategies and enhancing the development momentum of all countries.

Li Shuyu,Liang Daitong&Zhu Like,Scholar of Yunnan University

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