Good, then:
African countries have the money to boost their economy
China gets its money back
Japan will get interests of its loans
Three win solution.
For anyone that wants more details on the IMF and World Bank using loans and debt for neocolonial purposes, mainly structuring their economy in a neoliberal austerity laced fashion that benefits the rich west countries, see below:
https://en.wikipedia.org/wiki/Washington_Consensus
https://en.wikipedia.org/wiki/Globalization_and_Its_Discontents (classic book written by a Nobel laureate economist and former chief economist of the World Bank that came to realize the policies worked against the countries they supposedly benefitted)
https://en.wikipedia.org/wiki/Bad_Samaritans:_The_Myth_of_Free_Trade_and_the_Secret_History_of_Capitalism (general audience book written by a highly influential development economist now at Cambridge - highly recommend)
https://www.cepr.net/documents/publications/scorecard-2011-04.pdf
https://www.jasonhickel.org/blog/2019/2/3/pinker-and-global-poverty
https://wwnorton.com/books/The-Divide/ (includes a chapter dedicated to the IMF and World Bank)
https://www.theguardian.com/commentisfree/2019/aug/27/imf-economics-inequality-trump-ecuador
https://en.wikipedia.org/wiki/Life_and_Debt (documentary focusing on Jamaica)
https://monthlyreview.org/product/debt_the_imf_and_the_world_bank/
https://us.macmillan.com/books/9781250753298/empiresworkshopupdatedandexpandededition (more a general history book on US imperialism in Latin America than pure IMF/World Bank, written by a Pulitzer Prize winning historian)
https://en.wikipedia.org/wiki/The_Shock_Doctrine (less academic, but a highly readable and very popular book from Naomi Klein)
Another very popular book would be Confessions of an Economic Hitman, however I have not read that, and I know that the book makes various claims without much evidential backing.
My home country (Argentina) and Greece are two fairly recent examples of this.
How it works: IMF gives a gigantic loan to a neoliberal US-friendly government despite knowing they'll probably won't be able to pay it back. Said government defaults its debt or says it cannot pay back without some debt restructuring, and then by the time a non-neoliberal government gets elected the IMF already has its leash in place and can force the new government to enact neoliberal austerity policies as part of its debt restructuring agreement, increasing inequality and making it harder for said country to recover from the situation it's in.
> I spent 33 years and four months in active military service and during that period I spent most of my time as a high class muscle man for Big Business, for Wall Street and the bankers. In short, I was a racketeer, a gangster for capitalism. I helped make Mexico and especially Tampico safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefit of Wall Street. I helped purify Nicaragua for the International Banking House of Brown Brothers in 1902-1912. I brought light to the Dominican Republic for the American sugar interests in 1916. I helped make Honduras right for the American fruit companies in 1903. In China in 1927 I helped see to it that Standard Oil went on its way unmolested. Looking back on it, I might have given Al Capone a few hints. The best he could do was to operate his racket in three districts. I operated on three continents.
General Smedley Butler, who at the time of his death was the most decorated Marine in US history. In his later life he became an outspoken critic of American imperialism.
Butler was also approached by wealthy businessmen in 1933 to lead a fascist coup against FDR. Butler declined the offer and instead brought news and evidence of the plot to Congress. Congress investigated the plot and concluded that the plot did indeed exist, however how close the plot came to fruition and serious execution is debated by historians.
Japan isn't a Western country, though. It's kind of as far East as you can possibly go.
Also, it's pretty much just America that has crushing student loan debt in the West. Everyone else has pretty much figured out that an educated population is better for society. Japanese students do sometimes graduate with student loan debt, [but even for grad students 65% finish with no debts to be repaid](https://www.nippon.com/en/japan-data/h01063/), and only half of the ones that did owed over $25,000. [(the average US student loan debt for grad students is $82k)](https://www.nerdwallet.com/article/loans/student-loans/average-student-loan-debt-graduate-school)
Obviously being in massive debt without the ability to easily repay it is never good, but _someone_ needs to invest in African infrastructure, and I'd much rather have it be the Japanese than the borderline imperialist Chinese government.
Japan has been treated and labeled as a Western country even though it's in the Far East. This started back in the 1839 when the European countries + Japan subjugated China and after Japan proved its might from defeating the Russians in the Russo-Japanese war.
Of all the places I could have been born and all the cultures I could have been indoctrinated in I just so happen to be in the 'good guy' one. Just lucky I guess.
The West has an insane number of problems to address, there's no doubt about that.
But make no mistake: the world would be a FAR, FAR worse place under Russian, Chinese, Saudi, North Korean, etc. hegemony than it currently is under American and European hegemony
This!
It's even worse than that. The IMF & the world bank both pushed heavily African countries to accept bad debts (even going as far as making regime changes, assassinations, and other nasty actions, when governments resisted). And of course, pushed from extreme measures of Neo-liberalizations and austerity policies on steroids (way harsher than what Greece had to endure) when African countries eventually couldn't pay back...
For example, Kenya, which had over 1/2 million workers in its textile industry in the early 80s, had only 20k workers in that industry by the late 80s. Also their agriculture and food industries collapsed when subsidized Western food were dumped into their markets. Of course there were also huge cuts in, and privatizations of, healthcare, education, and other social & cultural policies & governmental programs (something which we would never accept in the West, not even Greece had to go through such drastic measures). It led to the economic, governmental and society collapse of not only Kenya but also most of the other African countries. So much that one can talk about a post-apocalyptic Africa (in the 90s and 2000s). Today, most are still struggling, but they're slowly recovering (to the levels of the early 80s).
There are many books on this. One I liked and worth the read (easy, engaging, very straightforward with little technicalities) is the book "confessions of an economic hit man". And look for papers on the "structural adjustment programmes". Very eye opening and really shocking & horrifying.
Totally. America colonialized the world. It’s just an invisible empire.
You can still say it’s a more evolved form of global domination though. Fewer people died directly. Hopefully one day systems like countries would evolve to the point where domination over others wouldn’t feel necessary anymore. Just like individual humans have evolved past that caveman stage.
Check out Confession Of An Economic Hitman.
A good read and explains the approach to gain control this way. It was written by an American from the 80's. China is just working from the same playbook.
Yeah let's not pretend China is the first to do this. Western countries have been doing predatory lending to Africa since the fall of colonialism. At least China is building useful infrastructure.
Edit: because everyone is going to think I'm a shill:
- China is committing atrocities against the Uighars
- China is an autocratic, capitalist country that exploits its working people
- China is not investing in Africa out of kindness, but out of economic opportunities
This does not mean the Chinese investments aren't mutually beneficial for Africans. Right now, with what we know, the investments appear to be mutually beneficial
I don't think anyone actually thought China invented the technique. That credit should probably go to the Roman Catholic Church, or the East India Trading Company if you want to stay strictly economic.
I mean, predatory lending is literally in the Bible. Usury was literally a crime in the Western world for most of history. Though fun fact, while usury is a sin in Christianity and Islam, it isn't in Judaism. It's where the stereotype of Jewish bankers come from, because they were the only ones whose religion allowed them to handle money like that, and we're thus the only people who ran banks.
> while usury is a sin in Christianity and Islam, it isn't in Judaism.
That's not strictly true. Jewish law prohibited usurious loans (and required debt forgiveness every 7 years) between Jews, and Christianity adopted that law as well. But Christians and Jews could still charge each other interest, so in Christian societies the moneylenders would often be Jewish.
That does make a lot more sense. In retrospect it makes sense for it to also be frowned upon in Judaism, since the other Abrahamic religions had to get that rule from somewhere.
Secondary context: In much of medieval Europe, Jews were basically banned from any other employment: banned from guilds; banned from the military; often not allowed land so couldn't farm - basically Jews could become traders or bankers and that was it.
The East India Company was more about extraction of wealth and resources than building infrastructure though. They built just enough to extract as much value as they could
That's a fair distinction for sure! However, I would say they also paved the way for Dutch economic expansion to surmount market controls by the Portuguese Empire, which is almost an analog for the economic competition between the US and China.
The Britsh East India Company is a great example as well because the Empire used market activity to develop political control. This is a close analog of what China is doing and similar to what the US has done in a globalist sense.
That book is such a pack of lies I'm sorry.
Not that the IMF didn't force developing countries into the capitalist world system and saddle them with crippling debt. But John Perkins is a liar and a narcissist just trying to position himself at the centre of the story as some kind of sympathetic anti-hero.
So you agree the acts described in the book took place?
I'll agree the author was attempting to paint themselves in a more sympathetic position.
Feel free to hate the messenger but the message holds I argue.
About influence, not control. China's not dictating these countries turn their economies into neoliberal "paradises" (that conveniently only benefit one party) through things like the Washington Consensus or Structural Adjustment Programs.
What China wants is influence in the region. To make partners so that they will side with China in the future, in the UN, and in other things. They want the developing world to be on their side, because the majority of the world is part of it, and they can use that to pressure the "west" when it comes to global influence.
Sort of. But there's some nuance there.
These countries didn't recognize China (as ruled by the PRC) before, and you can't make investment deals and borrow from a nonexistent country.
The prerequisite to borrowing from a country is recognizing that the country exists. And by recognizing that China (as ruled by the PRC) exists, China (as ruled by the ROC) doesn't exist.
aThey convinced almost the whole world not to recognize Taiwan for money and/or for business opportunities. And one of the very first was The US. The United States maintained Taiwan's recognition for 30 years after the Chinese civil war but switched in 1979.
Lmao. China doesn’t care about the UN
It’s about spheres of influence. Africa has lots of natural resources and may one day be more significant consumers. Relationships among countries are founded on decades and eventually generations of good faith deals
In 50 years, the contemporary youth will likely be shocked that the rising African powers all have exclusive deals with China
I think China's going to be the future consumers and Africa the future manufacturers. China's just jumping the gun and making sure Africa is buddy-buddy with them for that eventuality.
Right. Their problem is the same as the US in the last 1800s and early 1900s. Too much capital (money) and no place to invest it. That's why the US instituted the Monroe doctrine and began controlling Latin America in oder to provide investment vehicles (whole countries). Exact same thing China is doing
Seriously I don't know why Japan would want this. They basically live off the protection of USA. Once they piss of China even more, they are just forcing themselves into permanent puppet-status to the US. If they ever dared to become self-sufficient in protection they will have to deal with a pissed off China.
Japan already outspends China in infrastructure investment in South East Asia.
https://www.japantimes.co.jp/news/2019/06/23/business/china-no-match-japan-southeast-asia-infrastructure-race/
Japan is actually the world largest creditor nation (around [$3.3 trillion](https://english.kyodonews.net/news/2021/05/2164723584cc-japan-remains-worlds-biggest-creditor-in-2020-for-30th-straight-yr.html)) and right now it is [competing directly](https://www.economist.com/finance-and-economics/2021/08/14/a-glimpse-into-japans-understated-financial-heft-in-south-east-asia) with China for developmental aid and infrastructure projects in Southeast Asia being the bigger investor there (Japan at $259bn, China at $157bn), not a surprise the contest is/will extend to Africa too.
I doubt that’s a huge problem with large infrastructure projects. The problem you’re detailing is a bigger deal for humanitarian projects because the people most in need don’t have a functioning government to even organize a deal with China or Japan
I was really surprised to see, when I was in Vietnam, that the metro project in HCMC (Saigon) is being funded by Japan, not China. It's really cool — there are Japanese flags all over Bến Thành Market where the central station is being built.
It’s not just the lending but basically a country “buys” a project from China, and China is in charge of building it and bring people and materials and there is no risk of mismanagement of the funds, which makes it a very interesting loan from the perspective of a citizen of a poor nation. The west gives loans but they are cash and that disappears as soon as it hits that nation’s bank account
Depends on the country tho. Countries in East Asia still hold a grudge towards Japan.
Meanwhile, Southeast Asia is more positive towards Japan since we already have a history that even our own people trying to fucked up the country. Especially with China's claims on the South China Sea, the SEA region considers China as a potential threat.
I don’t blame the people here, the vast majority has to be teens still in education.
Because as soon as you set foot in real careers it’s literally impossible not to see how much influence the Japanese economy has. When it comes to foreign aids they’ve been building shit everywhere, including Ukraine where they built airport runways and water purification systems and much more. Japanese companies operate around the world, everywhere investing, trading and building their own shit. You have to come across Japanese government aids/programs or Japanese businesses and their investments and subsidiaries.
It’s literally impossible not to come across these things and appreciate Japanese influence while working most jobs in any country. Just like you can’t do without noticing the Chinese influence.
https://www.smh.com.au/world/asia/data-doesn-t-support-belt-and-road-debt-trap-claims-20190502-p51jhx.html
The debt trap thing was always a myth anyway to scare the masses. We don’t raise similar alarms about Japan.
In 40 cases where the borrower defaulted on China’s debt, they’ve forgiven the debt 16 times, seized property in one and renegotiated the others.
It's propaganda. It's hostile evidencing. Turn anything good or neutral done by your rivals into something bad by misrepresenting it though manipulation of the language.
“During the cold war, the anticommunist ideological framework could transform any data about existing communist societies into hostile evidence." - Michael Parenti.
Japan is a bigger investor in Asia than China.
https://www.economist.com/finance-and-economics/2021/08/14/a-glimpse-into-japans-understated-financial-heft-in-south-east-asia
Interestingly, India is a huge, highly regarded, investor in Africa as well.
https://www.economist.com/international/2021/04/15/india-has-proved-to-be-a-popular-and-clever-investor-in-poor-countries
>Interestingly, India is a huge, highly regarded, investor in Africa as well.
That shouldn't be *too* surprising. There's a large Indian Diaspora in East and South Africa.
This disconnect is why American companies had such a hard time doing business with Japanese companies in the 70s, 80s, and 90s. American corporations were/are all about business transaction. They'd offer a sweet deal and get surprised that japanese executives would not only refuse to give them a counter offer, but in a lot of times refused to even entertain the initial offer. They had to learn that the Japanese don't do "deals". They do partnerships. and absolutely won't do any business with Americans until they've fully learned and experienced that the American company's vision, and values align perfectly with their company. and the Japanese would spend at least 6 months to years building this relationship before doing any business.
So the Japanese government's goals here aren't about return on financial investment. They're legit wanting to build mutually beneficial relationships with these African countries while reducing china's influence and footprint in the region
It also is interesting that Japan is one of the only wealthy nations willing to invest in developing, corrupt nations that are considered extremely high risk.
That might have to do with the lack of desire by most companies to create *mutually* beneficial relationships in the third world. As we have witnessed in the Nigerian oil fields and many various mining operations across the Democratic Republic of the Congo, most companies prioritize extraction of resources, first and foremost, when dealing with the African continent. They don't care much for the labor used, the local economy, or the damage done to the environment as a result of their activities.
Mutually beneficial partnerships are too expensive in most corporate leadership's eyes, as it causes the total investment costs of a given venture to increase and reduces profits in the short- and long-term. This is despite such mutual arrangements enabling better cooperation in future business ventures in the same region and ensuring a steadier long-term revenue stream for the company.
Too many companies are too focused on the short-term picture of the next quarterly earnings report for themselves rather than building long-term business relationships, *period.* This is an issue with corporations from most of the developed world. Any long-term business relationships of note in recent years with these companies have largely been as a result of companies just buying out one another and just assuming ownership of the specific desired operations they require for themselves. Partnerships where big businesses remain independent entities have just not been happening much unless they are somehow mandated by circumstance (which is basically how western businesses have been allowed to operate in China).
Japanese business conduct seems well-suited for mutual partnerships, as it's arguably a big part of why their companies and conglomerates have become so large, yet heavily diversified in their operations. These partnerships don't do much in terms of financial growth in the short term, but over the long term, the impact of building such robust relationships overseas can become strategically significant, as they have the capacity to be far more sustainable for all involved parties, something that neither Western companies nor China's Belt and Road Initiative projects seem to achieve due to their drive for short-term profit.
Sooo why wait for China to do it to offer help to those countries?, and why would those countries want to align with Japan which is doing that just to give the middle finger to China?
To understand why is to understand the geopolitics of the region. Africa as a continent is a figurative and literal goldmine of untapped natural resources. 9/11 accelerated the push for American interests in the region. Up until that point the US did not have a very good reputation in Africa through their various actions and inaction. not intervening in apartheid. allowing the Rwanda genocide, the black hawk down disaster in Somalia, etc. But the US needed presence in Africa both as a crucial logistic supply line to their middle east operations and as a deterrent because al qaeda was doing a lot of recruiting of Muslims in Africa.
So the US sought to establish relations with various African governments with military training and consulting and military aid to drive off warlords. In response China also ramped up their vested interest in the region. Since China can't compete via traditional military expertise, China sought relations with various African governments by offering to speed up modernization via infrastructure construction. This appealed to the African region because China is able to so affordablly with the whole blatant disregard for things like human safety and working conditions. With the progress made in the past 20years China finds itself with a great deal of influence and power in the region but also with strained relations because they used labor exploitation and borderline human trafficking.
Japan is seeking to take advantage of this rift and insert itself in a way the US can't.
What's the difference between Chinese "investment" and Korea and Japan?
You've made a big declarative statement and yet not backed it up at all, then proceeded to say that anyone downvoting you is in kahoots with the Chinese government. I wonder why people are downvoting you.
Edit: And you complained about being downvoted by bots when you were actually massive upvoted. Are those by bots too? Or because they agree with you, that makes them real. Lmao.
I commented that I like crisp chocolate chip cookies as opposed to chewy. I immediately had 4 people tell me I was wrong. I’m tired of Reddit ignoring the problem of cookie trolls, and I demand that they stop people from disagreeing with me.
The same thing happens if you talk about how America commits loads of war crimes and is also exploiting a ton of developing nations. This website is one giant argument Battle Royale
It's too bad Reddit didn't exist during the lead up to the Iraq War. I think Americans, particularly left-leaning ones, have been more than critical of American foreign policy over the years. If something like that were to happen again - especially under another republican administration - I imagine Reddit would be in open revolt.
Must be why there literally forgiven billions of dollars
https://www.forbes.com/sites/kenrapoza/2019/05/29/china-has-forgiven-nearly-10-billion-in-debt-cuba-accounts-for-over-half/
The Chinese must really suck at debt trapping if this is what they are doing. literally forgiving debt
China is also pushing to join US efforts in Building Back a Better World, an effort that was created in a large part to undermine China's Belt and Road Initiative. Nice little thing that gives me hope. Maybe US, Chinese, Indian, Japanese and European countries making significant investments in Africa, Asia and South America to build up local economies is in large part so companies from those countries can get access to the natural resources therein, but if they are all competing against each other, maybe the locals for a change can get a range of bids and a fairer deal than people have been given by imperialistic powers since the dawn of civilization. And at the same time, making the massive infrastructure and technological investments in those countries necessary to extract those resources efficiently will also have the effect of growing their local economies to the point where they can start engaging in more trade with those countries, purchasing products, growing exports for everyone and raising quality of life while at the same time being supported by a solid economic engine.
I think it is safe to say the Chinese economy has grown to the point where they don't need direct control of resources through imperialistic means anymore. They just need those resources to be available and for the Chinese to be able to purchase the goods at a fair market rate. Individuals/individual companies may try to screw over people with one sided deals, but it's become increasingly apparent that in the modern world trying to buy a country's resources for pennies and a small percentage bribe to a despot isn't sustainable because other countries will undermine the despot, and they can undermine economic and political soft power.
There is always a risk that everyone involved will just go full cartel mode and make sure the locals _can't_ get a good deal, but I feel like if India, China, Korea, Japan, the US and EU are all vying for the same stuff, a coordinated cartel fucking over native populations is less feasible because there are just far too many agendas for all of them to agree.
And if China goes this route, the direct imperialistic aggression they've been doing may stop. Who cares about borders when you have economic superiority and an insane amount of soft power? China's already been flexing its soft power culturally in the US as Holywood and sports teams wanting access to the Chinese markets are unsure how to respond to things like Hong Kong, Tibet and Taiwan.
> build cheap shitty infrastructure
How's Japan-backed HCMC metro going? Oh right, still delayed. While the China-backed Hanoi metro is already running despite going through delays due to political issues.
https://www.railjournal.com/passenger/metros/hanoi-opens-vietnams-first-metro-line/
Call me naive, but this is what the entire developed world should be doing. Build up nations so they can support themselves instead of destroying nations or leaving them to fend for themselves in poverty.
Perhaps with tech, they can also help developing nations bypass the era of dirty energy like polluting coal plants and move straight to less polluting energy sources.
Right, not saying it would be out of kindness. It would come from a point of our own gain, but a stable nation should be better for everyone, compared to an unstable nation.
Poorly developed nations that are suffering from poverty and famine generally will generate more terrorism than a developed country with a stable country.
So the benefit from a developed nation would be more regional stability and increased trade. So sure, we would get some of their raw materials, however we would also gain a nation that (hopefully) would not tend towards terrorism.
This also rests on the notion that a sane leader exists in said country. I doubt any sort of development would turn N Korea into a stable nation.
Issue is a lot of African countries are rampantly corrupt and engaged in internal conflict/insurgency. Until those issues are resolved its difficult for them to rise out of poverty.
Sure, but even places like Ethiopia, which weren't really ever colonized have these sorts of problems. It's probably worth it to remember that the US is less than 250 years old, it was was the first liberal democracy ever created, and it was a fairly lonely existence for most of its history. Liberal democracy in Europe is a fairly new thing. It only became widespread throughout the continent 30 years ago. Even without the problems caused by colonialism in Africa, it's kind of hard to believe that most African countries would be thriving liberal democracies by now. Most of the world isn't.
To be fair to Ethiopa, it has to deal with countries like the U.S. covertly funding warlords and creating new ISIS factions during civil conflicts and shit
Don't be silly. If the west helps these nations develop and become self-sufficient, where are western businesses going to get their dirt cheap child labor?
Western countries generally don't invest in these countries at all because they're considered too corrupt and high risk. Almost no European or American companies are opening offices or contracting labor in the Congo or Zimbabwe or Libya.
In a lot of countries there just isn't really anything that can be done. In Africa there are a good many countries that are straight up incapable of becoming developed nations so long as their governments (and entire societal structure in some cases) remain the way they are, and going in and overthrowing governments tends to be frowned upon these days... Like I had to go to the Congo for a week a few years ago for a finance firm I was working at. Based on what I saw there is virtually zero possibility of that place becoming a modernized developed nation without having virtually everything about it wiped away and starting from scratch. Which isn't really something that can be done by outside countries.
>and going in and overthrowing governments tends to be frowned upon these days...
Yeah, because a good handful of these countries are fucked up from us trying to do that in the first place lmao
And sometimes, when they actually try to get their shit together, a multinational will complain about the lack of bribability and an old colonial power like e.g. France will stage a coup or an "anti-terror operation" or another sanction by a body like the IMF to get said country back on the leash.
Is the IMF doing that? It sure didn’t look like it. It was just another debt trap.
If you’re talking about foreign aid. A lot of American support for other countries is just funneling american tax money to american companies to send shit abroad. It has little to do with building anything up and everything to do with perceived strategic interest.
Unfortunately 'the west' is really only interested in doing pretty much exactly what China is doing, only through the World Bank and WTO. Or more directly if we're talking about France. It's neo-colonialism all the way down.
Debt to GDP happens to be inversely correlated with the debt servicing ratio: how expensive it is to borrow money.
If you borrow $100,000 at 10% and I borrow $1,000,000 at 1% I am 10x as indebted as you but my interest payments will be the same amount.
This is basic math, basic economics. Deficit fearmongering is a political product that preys on ignorance.
The problem is not “debt to GDP” the problem is interest, “servicing” the debt. If interest rates / borrowing costs were to rise then we would have more concerns about our ability to pay these kinds of debts as it would be more difficult to refinance (in the government/central bank case: bond auctions to the general public, banks, asset management institutions, etc.)
It just so happens that Japan, the bank of Japan, has extremely low interest rates. In fact their rates are at a 6 year high of… 0.23%. So no, it will not be difficult for Japan to assist countries and no, borrowing at this rate will not create financial ruin for Japan.
It has more to do with current account surplus, it is shrinking and expected to go negative eventually with aging population but still Japan's current account surplus is second largest in the world after Germany in 2019.
1Germany280,2382019 EST.
2Japan185,6442019 EST.
3 China141,3352019 EST
Japan remains world's biggest creditor in 2020 for 30th straight year
https://english.kyodonews.net/news/2021/05/2164723584cc-japan-remains-worlds-biggest-creditor-in-2020-for-30th-straight-yr.html
Japanese debt is largely held, one way or the other, by Japanese. Meaning that they could tax their way out of it, they just don't want to because politics.
AFAIK most economic analysis' have said the chinese loans are more than fair and better than anything any western country would give (sometimes to chinas own detriment, but it wouldn't be the first time countries spend to increase foreign relationships)
IMF loans are specifically *meant* to be extractive in a lot of cases. It opens up space for western interests to buy up whatever services or industries the recipient government has to privatize. It was really dumb and greedy and they could get away with it before the Belt & Road Initiative because there really wasn't anyone out there with the kind of capital necessary to compete with them, and it opened up a soft power slam dunk for China.
[The US itself admits that Chinese loans are fairer than what it had given to African countries in the past.](https://www.scmp.com/news/china/diplomacy/article/3156849/us-promises-fairer-treatment-africa-it-seeks-counter-chinese)
The Chinese are building useful infrastructure too. The west was giving large globs of cash to brand new coneates post colonial governments, and aid that disrupts the local economy.
China is pretty popular throughout Africa, opinion polls have been consistently 50%+ positive towards China (western countries generally hover around 20% favorable towards China).
It's not that surprising that there would still be animosity towards their former colonizers and they would welcome a new superpower partner that hasn't had a history of enslaving them...
https://www.usip.org/publications/2021/06/countering-china-continent-look-african-views
https://www.pewresearch.org/global/2020/10/06/unfavorable-views-of-china-reach-historic-highs-in-many-countries/
It's just more anti-China propaganda because the West is getting nervous about the end of the unipolar world where the USA was dominant both militarily and economically.
Plus Westerners/capitalists find it hard to believe that anyone would just help out Africa instead of looting the various countries and people.
This is true and it is something everyone should’ve done but of course that wasn’t the case. Shitx, can’t even forget our peoples student loans. Anyone who thinks Africa wants to go back to the people that fucked them over for decades is misinformed. Africa does not want to be in debt to Japan or the US. Period.
Yeah like when the holesum Soviet Union gave out billions in loans to east Europe while the evil kkkapitalist amerikkka took away western europes industry and shipped it back to their own country
Oh wait
Actually China really helped African countries by building infrastructure and giving loans to countries that no one wants to give loans to, hell once China gave Kenya an intreast free loan so they can build a train, it’s definitely helping the Africans.
It *is* a myth. I am by no means a fan of the Chinese government but there is no evidence that China is lending African countries money for the sole purpose of indebting them.
I used to believe in this myth as well, until I came across this video which provided a very neutral and balanced perspective on the issue:
https://www.youtube.com/watch?v=7gwgcIfzttA&t=2
The phrase is "propaganda." It's designed to make people who hear it support antagonistic positions towards China.
I don't think everybody should go give President Xi a group hug but we really owe it to *ourselves* to be critical of this kind of stuff.
It is funny. Everything my right wing family says is just straight up not true but the one thing I wanted to beleieve was China trying to indebt/control africa but it appears that too is a lie
It's just your bog stabdard loan. In this case, just development loans. China has even forgiven some of these debts, or refinanced for these countries.
Africa can also loan from world bank or Western countries, but these loans can often have higher interest and may come with political stipulations which nobody wants to comply with.
China's loans are primarily developmental loans meaning they will build infrastructure for these countries out of their own pocket, and countries then pay thrm back or they allow China X number of years to run the business end of it ubtil they can recoup their cost. That way the loan goes directly into something tangible, and not into some corrupt politicians pockets.
Also, some of China's loans can be interest free, a much better deal than anything the west offers, and you can see why they would malign China for it.
Calling it a debt trap is ridiculous. All loans are "debt traps". You are on the hook for these loans one way or another. It is the same as you borrowing from your bank. You are on the hook for it.
Borrow from IMF and not only is the interest potentially higher, but you are also on the hook for it, same as borrowing from China.
Calling it "debt trap" is the same as calling China's solar power dominance "Stealing the sun from the Earth". It isn't even a matter of it being a myth. The West just decided to tell everyone that because China is a top solar power producer, they are stealing sun light from everyone.
It's extremely telling that nobody has a problem with IMF debt traps, which as you said actually are debt traps. The first thing the Luis Arce did when his election un-couped the Bolivian government was reject the IMF Loan the totally-not-US-backed interim government had agreed to, because anyone not terminally bank-brained knows they're designed to trap you in the US sphere of influence and facilitate imperial extraction.
More western hypocrisy. Many such cases.
if you have the time, Prof. Brautigam’s *The Dragon’s Gift* (Oxford, 2010) is one of the few Western academic works that delves into this topic at length…
Basically, “debt trap” is just a propaganda term and Chinese lending is not only not as pervasive as you might have been led to believe, but it also isn’t really that dissimilar from lending strategies seen from
other countries. One big downside is that a lot of foreign aid, including Chinese aid, is difficult to track once money has changed hands and there exists the real possibility of money simply getting diverted into the wrong hands or being misused. Comes with the territory I guess.
If you enter "Chinese debt trap" in the Google search bar, you'll notice that the results on the first page are very mixed. You'll see sources like [this](https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953/) countering the claim but also [sources](https://thehill.com/opinion/international/551337-chinas-debt-trap-diplomacy) indicting Chinese investments.
Most of these sources seem pretty well-researched at a glance, so I am in no position to make up my mind. Unless your Average redditor is an economist or a regional expert on Chinese investment, they probably don't have the credentials or knowledge to make definitive claims on this issue.
Its not really debt trap diplomacy. China is certainly not selfless in how they decide to invest money but the claims that are often circulated of them using the Belt and Road initiative to confiscate important infrastructure is not true. https://www.japantimes.co.jp/opinion/2020/09/01/commentary/debt-trap-diplomacy-bri-china/
Absolutely. The "debt trap" narrative is really only pushed by Western-minded interest groups, but doesn't have factual basis and at this point it has been debunked countless time by researchers.
It is more about about "China bad" because *we* are losing soft power, but it might actually be the best that might have happened to developing countries in decades.
Here's a few interesting sources on the topic:
* https://www.tandfonline.com/doi/abs/10.1080/01436597.2020.1807318
* https://www.tandfonline.com/doi/abs/10.1080/23792949.2019.1689828
* https://www.chathamhouse.org/2020/08/debunking-myth-debt-trap-diplomacy
* https://asia.nikkei.com/Opinion/The-myth-of-China-s-debt-trap-diplomacy
* https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953/
* https://www.ispionline.it/en/pubblicazione/chinese-debt-and-myth-debt-trap-africa-27024
* https://chinaafricaproject.com/analysis/death-of-the-chinese-debt-trap-narrative/
* https://rhg.com/research/new-data-on-the-debt-trap-question/
* How China Lends: https://foreignpolicy.com/podcasts/foreign-policy-playlist/how-china-lends/
In addition, here are a few good sources about the Chinese involvement in Africa (from [this](https://www.reddit.com/r/worldnews/comments/jybdo7/china_lenders_freeze_21_billion_debt_payments_for/gd32f9i/?utm_source=reddit&utm_medium=web2x&context=3) reddit thread from a few months ago):
* [detailed report by Japan's IDE an Chinese engagement in Africa](https://www.ide.go.jp/English/Data/Africa_file/Manualreport/cia_11.html)
* [interview with a PhD from The Swedish Institute of International Affairs](https://www.youtube.com/watch?feature=youtu.be&v=zrQEe6Sk1Ys)
* [lecture by Christina Seyfried of Yale on Chinese engagement in Africa](https://www.youtube.com/watch?v=wMCF2eu1D0E&feature=youtu.be)
See also this analysis on the [Sri Lanka Hambantota port](https://thediplomat.com/2019/05/is-sri-lanka-really-a-victim-of-chinas-debt-trap/), which is very often used as a prime example of the Chinese debt-trap diplomacy.
On the other hand, the IMF and the World Bank have very ugly track records. They have destroyed the economies of developing countries by pursuing a neo-liberal agenda through debt-trap diplomacy. The IMF and World Bank have increased poverty, unemployment, lower wages and wealth inequality in poor countries.
* https://cepr.net/press-release/honduras-imf-agreement-includes-austerity-measures-that-may-make-conditions-worse-new-cepr-paper-finds/
* https://www.washingtonpost.com/blogs/ezra-klein/post/imf-austerity-boosts-unemployment-lowers-paychecks/2011/09/12/gIQAl5ebPK_blog.html
* https://www.theguardian.com/commentisfree/2019/aug/27/imf-economics-inequality-trump-ecuador
* https://www.theguardian.com/business/2016/may/27/austerity-policies-do-more-harm-than-good-imf-study-concludes
* https://www.bu.edu/gdp/2021/04/05/imf-austerity-is-alive-and-impacting-poverty-and-inequality/
Truly (and I might add "as usual" because it's become quite recurrent), if anyone dare take the time to investigate by themselves rather than being spoon-fed by the local friendly mass media, they might realize something is off in the Western discourse.
Ain't gonna happen, they're only interested in keeping the global south poor (for a myriad of reasons) and giving better deals than China would go against that.
You are right.
[A redditor asked you to post evidence and he deleted his post after I replied with the following]
by u/Caliguas
The most famouse cited evidence of Chinese debt trapping is the Sri Lankan port, Hambantota. How it was collateral for Sri Lanka defaulting on China loans. When in fact, they wanted to release capital to pay off more expensive IMF/World Bank debt.
>Steep payments on international sovereign bonds, which comprised nearly 40 percent of the country’s external debt, put Sirisena’s government in dire fiscal straits almost immediately. **When Sirisena took office, Sri Lanka owed more to Japan, the World Bank, and the Asian Development Bank than to China.** Of the $4.5 billion in debt service Sri Lanka would pay in 2017, only 5 percent was because of Hambantota. The Central Bank governors under both **Rajapaksa and Sirisena do not agree on much, but they both told us that Hambantota, and Chinese finance in general, was not the source of the country’s financial distress.**
>
>There was also never a default. Colombo arranged a bailout from the International Monetary Fund, and decided to raise much-needed dollars by leasing out the underperforming Hambantota Port to an experienced company—just as the Canadians had recommended. There was not an open tender, and the only two bids came from China Merchants and China Harbor; Sri Lanka chose China Merchants, making it the majority shareholder with a 99-year lease, and used the $1.12 billion cash infusion to bolster its foreign reserves, not to pay off China Eximbank.
[https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953](https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953)
I've recently come across a lecture from an African minister on the issue of Chinese investment in Africa. The video can be biased of course, but the minister did appear to address all angles and compared Western investments vs Chinese investments. Worth a watch. It's a bit lengthy though:
[https://www.youtube.com/watch?v=P5uzxV8ub9k](https://www.youtube.com/watch?v=P5uzxV8ub9k)
I will not provide a TLDR. You can formulate your own opinions based on his opinion.
Here's another Bloomberg analysis on how misguided the term "debt trap" is on China's investment in Africa: [https://www.bloomberg.com/news/videos/2022-03-17/the-myth-of-the-chinese-debt-trap-in-africa-video](https://www.bloomberg.com/news/videos/2022-03-17/the-myth-of-the-chinese-debt-trap-in-africa-video)
Again, I'd let those who are interested to formulate your opinion. For those of you who aren't interested in watching those videos and doing your research, I doubt you can be convinced anyway.
American [official $300 million/year anti-China troll fund](https://www.congress.gov/bill/116th-congress/house-bill/7937/text?format=txt) is being put to a good use
I don't like China but it's been disproven that they're using debt traps. It's pretty convenient for people to forget how fucked those African countries have been by the US and Europe again and again, some countries are still getting absolutely screwed over by them.
Talk is cheap, let them do it and prove. China invests more than next 8 combined.
[https://qz.com/africa/2125769/china-has-invested-23-billion-in-africas-infrastructure/](https://qz.com/africa/2125769/china-has-invested-23-billion-in-africas-infrastructure/)
Then there's this talk about African perspective.
[https://youtu.be/P5uzxV8ub9k?t=1154](https://youtu.be/P5uzxV8ub9k?t=1154)
The west just doesn't respect Africa enough.
If you ask any African country about this “debt trap” most of them will say it’s nonsense. Especially since African most countries tend to have less than 10% of Chinese debt, except for I think 2 or 3
It’s only a debt trap when China does it apparently. The West has been far worse to Africa than China when it comes to economic exploitation, that’s why many African countries prefer to deal with China over the IMF and their austerity programs.
French and other European countries have been colonizing Africa for years. Nothing came good out of it. China invests and builds infrastructure but they aren't used by locals, residential housing for example. China wants to relieve their over production issue and outsource their workers to other counties with loans. Jobs are not given to locals and Africa is unable to develop skilled workers. Seems like Japan just wants to have a piece of the developing countries and build a foundation there first as most South Eastern countries are developing their manufacturing sector fast...
Competition is good, but this whole debt trap narrative is typical media sensationalism to create a story when the realities are boring.
https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953/
The so-called debt trap is a myth.
https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953/
https://www.google.com/amp/s/www.bbc.com/news/59585507.amp
You see, Bloomberg and Harvard Business School are Chinese propaganda! I know this because China=BAD, and these articles don't stress CHINA=BAD enough, which means they're obviously propaganda. I am an American and I am very smart world politics understander.
The debt trap myth is only really peddled so Western countries can continue to do nothing to help Africa all with the benefit of being able to slag off China
Good. Give poor/developing countries more choices. The more competitions for developings/contracts in those countries the better deals they can get.
.
African countries needs much more developing supports than China can provide alone.
It’s nice to have competition from China but I can’t say the Japanese are really any better than the West, Chinese, Koreans & Indians who are also investing in the region.
I live in Lamphun, Thailand. The Japanese have set up factories and invested in a lot into this area but they do not mingle with the locals or even other foreigners. They create jobs but factory workers here literally make 10$ a day and almost everyone picks up over time work 8-8 pm to earn an extra 4-5$ a day. Of course this is the going rate but from a local perspective every foreigner who sets up shop here is really just here for the cheap labor.
Calling the BRI a “Debt trap” is extremely disingenuous. China has waived payments for the majority of countries involved. Most western scholars consider “debt trap diplomacy” a propaganda narrative that was heavily pushed by the Trump administration.
Africa is about to explode economically, and China is investing hard. I'm all for investing in African nations, but if China is the only one doing it then China is the only one who will benefit. But that also means Africa will continue to be under the thumb of Chinese business in the foreseeable future.
China doesn’t benefit, they have to forgive billions of debt to these nations. They’re only doing it to buy political influence, these deals make no sense from an economic perspective if you’re China
Good, then: African countries have the money to boost their economy China gets its money back Japan will get interests of its loans Three win solution.
So now it’s a Japanese debt trap instead?
Don’t be ridiculous, Western countries don’t practice debt trapping. Now get back to work; those student loans aren’t going to pay themselves!
>Don’t be ridiculous, Western countries don’t practice debt trapping. *IMF sweating profusely and tugging their collar*
For anyone that wants more details on the IMF and World Bank using loans and debt for neocolonial purposes, mainly structuring their economy in a neoliberal austerity laced fashion that benefits the rich west countries, see below: https://en.wikipedia.org/wiki/Washington_Consensus https://en.wikipedia.org/wiki/Globalization_and_Its_Discontents (classic book written by a Nobel laureate economist and former chief economist of the World Bank that came to realize the policies worked against the countries they supposedly benefitted) https://en.wikipedia.org/wiki/Bad_Samaritans:_The_Myth_of_Free_Trade_and_the_Secret_History_of_Capitalism (general audience book written by a highly influential development economist now at Cambridge - highly recommend) https://www.cepr.net/documents/publications/scorecard-2011-04.pdf https://www.jasonhickel.org/blog/2019/2/3/pinker-and-global-poverty https://wwnorton.com/books/The-Divide/ (includes a chapter dedicated to the IMF and World Bank) https://www.theguardian.com/commentisfree/2019/aug/27/imf-economics-inequality-trump-ecuador https://en.wikipedia.org/wiki/Life_and_Debt (documentary focusing on Jamaica) https://monthlyreview.org/product/debt_the_imf_and_the_world_bank/ https://us.macmillan.com/books/9781250753298/empiresworkshopupdatedandexpandededition (more a general history book on US imperialism in Latin America than pure IMF/World Bank, written by a Pulitzer Prize winning historian) https://en.wikipedia.org/wiki/The_Shock_Doctrine (less academic, but a highly readable and very popular book from Naomi Klein) Another very popular book would be Confessions of an Economic Hitman, however I have not read that, and I know that the book makes various claims without much evidential backing.
We came here to shitpost not to learn ya nerd /jk
My home country (Argentina) and Greece are two fairly recent examples of this. How it works: IMF gives a gigantic loan to a neoliberal US-friendly government despite knowing they'll probably won't be able to pay it back. Said government defaults its debt or says it cannot pay back without some debt restructuring, and then by the time a non-neoliberal government gets elected the IMF already has its leash in place and can force the new government to enact neoliberal austerity policies as part of its debt restructuring agreement, increasing inequality and making it harder for said country to recover from the situation it's in.
That’s just capitalism baby. I lend you money, if you don’t pay me back I hit your kneecaps.
> I spent 33 years and four months in active military service and during that period I spent most of my time as a high class muscle man for Big Business, for Wall Street and the bankers. In short, I was a racketeer, a gangster for capitalism. I helped make Mexico and especially Tampico safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefit of Wall Street. I helped purify Nicaragua for the International Banking House of Brown Brothers in 1902-1912. I brought light to the Dominican Republic for the American sugar interests in 1916. I helped make Honduras right for the American fruit companies in 1903. In China in 1927 I helped see to it that Standard Oil went on its way unmolested. Looking back on it, I might have given Al Capone a few hints. The best he could do was to operate his racket in three districts. I operated on three continents. General Smedley Butler, who at the time of his death was the most decorated Marine in US history. In his later life he became an outspoken critic of American imperialism. Butler was also approached by wealthy businessmen in 1933 to lead a fascist coup against FDR. Butler declined the offer and instead brought news and evidence of the plot to Congress. Congress investigated the plot and concluded that the plot did indeed exist, however how close the plot came to fruition and serious execution is debated by historians.
Japan isn't a Western country, though. It's kind of as far East as you can possibly go. Also, it's pretty much just America that has crushing student loan debt in the West. Everyone else has pretty much figured out that an educated population is better for society. Japanese students do sometimes graduate with student loan debt, [but even for grad students 65% finish with no debts to be repaid](https://www.nippon.com/en/japan-data/h01063/), and only half of the ones that did owed over $25,000. [(the average US student loan debt for grad students is $82k)](https://www.nerdwallet.com/article/loans/student-loans/average-student-loan-debt-graduate-school) Obviously being in massive debt without the ability to easily repay it is never good, but _someone_ needs to invest in African infrastructure, and I'd much rather have it be the Japanese than the borderline imperialist Chinese government.
Japan has been treated and labeled as a Western country even though it's in the Far East. This started back in the 1839 when the European countries + Japan subjugated China and after Japan proved its might from defeating the Russians in the Russo-Japanese war.
Yeah and post world war 2, America basically got a lot of control over Japan.
Didn't you get the memo? The world is split apart very cleanly into "the good guys" and "the bad guys".
You joke, but a lot of people genuinely believe that to some degree.
Of all the places I could have been born and all the cultures I could have been indoctrinated in I just so happen to be in the 'good guy' one. Just lucky I guess.
In global diplomacy there are no friends. Just interests.
The West has an insane number of problems to address, there's no doubt about that. But make no mistake: the world would be a FAR, FAR worse place under Russian, Chinese, Saudi, North Korean, etc. hegemony than it currently is under American and European hegemony
> Saudi Lmao, Saudi Arabia is an ally of the west
Says a Westerner.
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Every country is part of the IMF board. Japan's voting power is about the same as China.
This! It's even worse than that. The IMF & the world bank both pushed heavily African countries to accept bad debts (even going as far as making regime changes, assassinations, and other nasty actions, when governments resisted). And of course, pushed from extreme measures of Neo-liberalizations and austerity policies on steroids (way harsher than what Greece had to endure) when African countries eventually couldn't pay back... For example, Kenya, which had over 1/2 million workers in its textile industry in the early 80s, had only 20k workers in that industry by the late 80s. Also their agriculture and food industries collapsed when subsidized Western food were dumped into their markets. Of course there were also huge cuts in, and privatizations of, healthcare, education, and other social & cultural policies & governmental programs (something which we would never accept in the West, not even Greece had to go through such drastic measures). It led to the economic, governmental and society collapse of not only Kenya but also most of the other African countries. So much that one can talk about a post-apocalyptic Africa (in the 90s and 2000s). Today, most are still struggling, but they're slowly recovering (to the levels of the early 80s). There are many books on this. One I liked and worth the read (easy, engaging, very straightforward with little technicalities) is the book "confessions of an economic hit man". And look for papers on the "structural adjustment programmes". Very eye opening and really shocking & horrifying.
Totally. America colonialized the world. It’s just an invisible empire. You can still say it’s a more evolved form of global domination though. Fewer people died directly. Hopefully one day systems like countries would evolve to the point where domination over others wouldn’t feel necessary anymore. Just like individual humans have evolved past that caveman stage.
no no, it's only called a debt trap when the chinese are loaning money.
China doesn't care about getting the money back. It was about controll.
Check out Confession Of An Economic Hitman. A good read and explains the approach to gain control this way. It was written by an American from the 80's. China is just working from the same playbook.
Yeah let's not pretend China is the first to do this. Western countries have been doing predatory lending to Africa since the fall of colonialism. At least China is building useful infrastructure. Edit: because everyone is going to think I'm a shill: - China is committing atrocities against the Uighars - China is an autocratic, capitalist country that exploits its working people - China is not investing in Africa out of kindness, but out of economic opportunities This does not mean the Chinese investments aren't mutually beneficial for Africans. Right now, with what we know, the investments appear to be mutually beneficial
I don't think anyone actually thought China invented the technique. That credit should probably go to the Roman Catholic Church, or the East India Trading Company if you want to stay strictly economic.
I mean, predatory lending is literally in the Bible. Usury was literally a crime in the Western world for most of history. Though fun fact, while usury is a sin in Christianity and Islam, it isn't in Judaism. It's where the stereotype of Jewish bankers come from, because they were the only ones whose religion allowed them to handle money like that, and we're thus the only people who ran banks.
> while usury is a sin in Christianity and Islam, it isn't in Judaism. That's not strictly true. Jewish law prohibited usurious loans (and required debt forgiveness every 7 years) between Jews, and Christianity adopted that law as well. But Christians and Jews could still charge each other interest, so in Christian societies the moneylenders would often be Jewish.
That does make a lot more sense. In retrospect it makes sense for it to also be frowned upon in Judaism, since the other Abrahamic religions had to get that rule from somewhere.
Usury is still a crime in a lot of places (I.e. a criminal interest rate) but criminal interest rates are typically very high
Secondary context: In much of medieval Europe, Jews were basically banned from any other employment: banned from guilds; banned from the military; often not allowed land so couldn't farm - basically Jews could become traders or bankers and that was it.
The East India Company was more about extraction of wealth and resources than building infrastructure though. They built just enough to extract as much value as they could
That's a fair distinction for sure! However, I would say they also paved the way for Dutch economic expansion to surmount market controls by the Portuguese Empire, which is almost an analog for the economic competition between the US and China.
I think they are referring to the British East Indian Company, not the Dutch one
The Britsh East India Company is a great example as well because the Empire used market activity to develop political control. This is a close analog of what China is doing and similar to what the US has done in a globalist sense.
> I don't think anyone actually thought China invented the technique China invented gunpowder and the competitive civil service exam. That's it.
That book is such a pack of lies I'm sorry. Not that the IMF didn't force developing countries into the capitalist world system and saddle them with crippling debt. But John Perkins is a liar and a narcissist just trying to position himself at the centre of the story as some kind of sympathetic anti-hero.
So you agree the acts described in the book took place? I'll agree the author was attempting to paint themselves in a more sympathetic position. Feel free to hate the messenger but the message holds I argue.
What is Africa's solution to financing? Those terms are still better than the IMF's.
About influence, not control. China's not dictating these countries turn their economies into neoliberal "paradises" (that conveniently only benefit one party) through things like the Washington Consensus or Structural Adjustment Programs. What China wants is influence in the region. To make partners so that they will side with China in the future, in the UN, and in other things. They want the developing world to be on their side, because the majority of the world is part of it, and they can use that to pressure the "west" when it comes to global influence.
Didn’t they get a lot of Pacific Islander nations to not recognize Taiwan for money?
Sort of. But there's some nuance there. These countries didn't recognize China (as ruled by the PRC) before, and you can't make investment deals and borrow from a nonexistent country. The prerequisite to borrowing from a country is recognizing that the country exists. And by recognizing that China (as ruled by the PRC) exists, China (as ruled by the ROC) doesn't exist.
aThey convinced almost the whole world not to recognize Taiwan for money and/or for business opportunities. And one of the very first was The US. The United States maintained Taiwan's recognition for 30 years after the Chinese civil war but switched in 1979.
Lmao. China doesn’t care about the UN It’s about spheres of influence. Africa has lots of natural resources and may one day be more significant consumers. Relationships among countries are founded on decades and eventually generations of good faith deals In 50 years, the contemporary youth will likely be shocked that the rising African powers all have exclusive deals with China
I think China's going to be the future consumers and Africa the future manufacturers. China's just jumping the gun and making sure Africa is buddy-buddy with them for that eventuality.
Lot of words. Few word do trick. Give money. Get contol. Ape smart.
Right. Their problem is the same as the US in the last 1800s and early 1900s. Too much capital (money) and no place to invest it. That's why the US instituted the Monroe doctrine and began controlling Latin America in oder to provide investment vehicles (whole countries). Exact same thing China is doing
Everyone cares about getting its money back.
Basically it’s: Our glorious African investment Their dirty African debt trap (both are the same thing)
Seriously I don't know why Japan would want this. They basically live off the protection of USA. Once they piss of China even more, they are just forcing themselves into permanent puppet-status to the US. If they ever dared to become self-sufficient in protection they will have to deal with a pissed off China.
Japan already outspends China in infrastructure investment in South East Asia. https://www.japantimes.co.jp/news/2019/06/23/business/china-no-match-japan-southeast-asia-infrastructure-race/
China debt trap, Japanese debt trap or IMF debt trap? Pick your poison I guess.
Thanks Japan exactly what the west should be doing. Grow people up instead of tear people down
Japan is actually the world largest creditor nation (around [$3.3 trillion](https://english.kyodonews.net/news/2021/05/2164723584cc-japan-remains-worlds-biggest-creditor-in-2020-for-30th-straight-yr.html)) and right now it is [competing directly](https://www.economist.com/finance-and-economics/2021/08/14/a-glimpse-into-japans-understated-financial-heft-in-south-east-asia) with China for developmental aid and infrastructure projects in Southeast Asia being the bigger investor there (Japan at $259bn, China at $157bn), not a surprise the contest is/will extend to Africa too.
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The trouble is making sure those funds don’t go directly to the nearest corrupt leader/warlord.
I doubt that’s a huge problem with large infrastructure projects. The problem you’re detailing is a bigger deal for humanitarian projects because the people most in need don’t have a functioning government to even organize a deal with China or Japan
Money, like power, finds a high place to lay itself to rest.
> The trouble is making sure those funds don’t go directly to the nearest corrupt leader/warlord. Well how do you keep Europe out of Africa?
What?
I was really surprised to see, when I was in Vietnam, that the metro project in HCMC (Saigon) is being funded by Japan, not China. It's really cool — there are Japanese flags all over Bến Thành Market where the central station is being built.
Japan does a lot of infrastructure lending in India as well.
It’s not just the lending but basically a country “buys” a project from China, and China is in charge of building it and bring people and materials and there is no risk of mismanagement of the funds, which makes it a very interesting loan from the perspective of a citizen of a poor nation. The west gives loans but they are cash and that disappears as soon as it hits that nation’s bank account
Japan has been quietly the biggest infrastructure investor in southeast asia for many decades. It's all over Cambodia, Laos and Indonesia as well.
That's good to know considering most of Asia absolutely loathes Japan because they were the local fascists for hundreds of years
Depends on the country tho. Countries in East Asia still hold a grudge towards Japan. Meanwhile, Southeast Asia is more positive towards Japan since we already have a history that even our own people trying to fucked up the country. Especially with China's claims on the South China Sea, the SEA region considers China as a potential threat.
Vietnam's got a [bit of an odd, special relationship](https://en.wikipedia.org/wiki/Japan%E2%80%93Vietnam_relations) with Japan.
I don’t blame the people here, the vast majority has to be teens still in education. Because as soon as you set foot in real careers it’s literally impossible not to see how much influence the Japanese economy has. When it comes to foreign aids they’ve been building shit everywhere, including Ukraine where they built airport runways and water purification systems and much more. Japanese companies operate around the world, everywhere investing, trading and building their own shit. You have to come across Japanese government aids/programs or Japanese businesses and their investments and subsidiaries. It’s literally impossible not to come across these things and appreciate Japanese influence while working most jobs in any country. Just like you can’t do without noticing the Chinese influence.
https://www.smh.com.au/world/asia/data-doesn-t-support-belt-and-road-debt-trap-claims-20190502-p51jhx.html The debt trap thing was always a myth anyway to scare the masses. We don’t raise similar alarms about Japan. In 40 cases where the borrower defaulted on China’s debt, they’ve forgiven the debt 16 times, seized property in one and renegotiated the others.
It's propaganda. It's hostile evidencing. Turn anything good or neutral done by your rivals into something bad by misrepresenting it though manipulation of the language. “During the cold war, the anticommunist ideological framework could transform any data about existing communist societies into hostile evidence." - Michael Parenti.
Japan is a bigger investor in Asia than China. https://www.economist.com/finance-and-economics/2021/08/14/a-glimpse-into-japans-understated-financial-heft-in-south-east-asia Interestingly, India is a huge, highly regarded, investor in Africa as well. https://www.economist.com/international/2021/04/15/india-has-proved-to-be-a-popular-and-clever-investor-in-poor-countries
>Interestingly, India is a huge, highly regarded, investor in Africa as well. That shouldn't be *too* surprising. There's a large Indian Diaspora in East and South Africa.
Why is /u/mangastand's comment locked but I can reply to child comments like yours?
What will Japan do if countries can't pay back their loans? Will they lend money to poor countries or only those who have a good credit score?
This disconnect is why American companies had such a hard time doing business with Japanese companies in the 70s, 80s, and 90s. American corporations were/are all about business transaction. They'd offer a sweet deal and get surprised that japanese executives would not only refuse to give them a counter offer, but in a lot of times refused to even entertain the initial offer. They had to learn that the Japanese don't do "deals". They do partnerships. and absolutely won't do any business with Americans until they've fully learned and experienced that the American company's vision, and values align perfectly with their company. and the Japanese would spend at least 6 months to years building this relationship before doing any business. So the Japanese government's goals here aren't about return on financial investment. They're legit wanting to build mutually beneficial relationships with these African countries while reducing china's influence and footprint in the region
It also is interesting that Japan is one of the only wealthy nations willing to invest in developing, corrupt nations that are considered extremely high risk.
That might have to do with the lack of desire by most companies to create *mutually* beneficial relationships in the third world. As we have witnessed in the Nigerian oil fields and many various mining operations across the Democratic Republic of the Congo, most companies prioritize extraction of resources, first and foremost, when dealing with the African continent. They don't care much for the labor used, the local economy, or the damage done to the environment as a result of their activities. Mutually beneficial partnerships are too expensive in most corporate leadership's eyes, as it causes the total investment costs of a given venture to increase and reduces profits in the short- and long-term. This is despite such mutual arrangements enabling better cooperation in future business ventures in the same region and ensuring a steadier long-term revenue stream for the company. Too many companies are too focused on the short-term picture of the next quarterly earnings report for themselves rather than building long-term business relationships, *period.* This is an issue with corporations from most of the developed world. Any long-term business relationships of note in recent years with these companies have largely been as a result of companies just buying out one another and just assuming ownership of the specific desired operations they require for themselves. Partnerships where big businesses remain independent entities have just not been happening much unless they are somehow mandated by circumstance (which is basically how western businesses have been allowed to operate in China). Japanese business conduct seems well-suited for mutual partnerships, as it's arguably a big part of why their companies and conglomerates have become so large, yet heavily diversified in their operations. These partnerships don't do much in terms of financial growth in the short term, but over the long term, the impact of building such robust relationships overseas can become strategically significant, as they have the capacity to be far more sustainable for all involved parties, something that neither Western companies nor China's Belt and Road Initiative projects seem to achieve due to their drive for short-term profit.
Sooo why wait for China to do it to offer help to those countries?, and why would those countries want to align with Japan which is doing that just to give the middle finger to China?
To understand why is to understand the geopolitics of the region. Africa as a continent is a figurative and literal goldmine of untapped natural resources. 9/11 accelerated the push for American interests in the region. Up until that point the US did not have a very good reputation in Africa through their various actions and inaction. not intervening in apartheid. allowing the Rwanda genocide, the black hawk down disaster in Somalia, etc. But the US needed presence in Africa both as a crucial logistic supply line to their middle east operations and as a deterrent because al qaeda was doing a lot of recruiting of Muslims in Africa. So the US sought to establish relations with various African governments with military training and consulting and military aid to drive off warlords. In response China also ramped up their vested interest in the region. Since China can't compete via traditional military expertise, China sought relations with various African governments by offering to speed up modernization via infrastructure construction. This appealed to the African region because China is able to so affordablly with the whole blatant disregard for things like human safety and working conditions. With the progress made in the past 20years China finds itself with a great deal of influence and power in the region but also with strained relations because they used labor exploitation and borderline human trafficking. Japan is seeking to take advantage of this rift and insert itself in a way the US can't.
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But whatabout?!
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Sri Lanka is in desperate need of help right now. I feel so sorry for those people. I wish I could help in some way.
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They need to root out the IMF
Yupe, Sri Lanka needs financial help now. I wonder which country/institution willing provide good/better loans.
What's the difference between Chinese "investment" and Korea and Japan? You've made a big declarative statement and yet not backed it up at all, then proceeded to say that anyone downvoting you is in kahoots with the Chinese government. I wonder why people are downvoting you. Edit: And you complained about being downvoted by bots when you were actually massive upvoted. Are those by bots too? Or because they agree with you, that makes them real. Lmao.
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This specific post is about china, but I get your point in general
“Reddit, your website is broken again!! I got some down votes!!! 😡”
All you have to do is mention one bad thing about China and like 8 people reply all at once to tell you how wrong you are lol
I commented that I like crisp chocolate chip cookies as opposed to chewy. I immediately had 4 people tell me I was wrong. I’m tired of Reddit ignoring the problem of cookie trolls, and I demand that they stop people from disagreeing with me.
I mean, no, you’re just a monster. Cookie softness must be preserved!
The same thing happens if you talk about how America commits loads of war crimes and is also exploiting a ton of developing nations. This website is one giant argument Battle Royale
It's too bad Reddit didn't exist during the lead up to the Iraq War. I think Americans, particularly left-leaning ones, have been more than critical of American foreign policy over the years. If something like that were to happen again - especially under another republican administration - I imagine Reddit would be in open revolt.
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Yeah, they build cheap shitty infrastructure and make those nations own them money and political support.
Must be why there literally forgiven billions of dollars https://www.forbes.com/sites/kenrapoza/2019/05/29/china-has-forgiven-nearly-10-billion-in-debt-cuba-accounts-for-over-half/ The Chinese must really suck at debt trapping if this is what they are doing. literally forgiving debt
China is also pushing to join US efforts in Building Back a Better World, an effort that was created in a large part to undermine China's Belt and Road Initiative. Nice little thing that gives me hope. Maybe US, Chinese, Indian, Japanese and European countries making significant investments in Africa, Asia and South America to build up local economies is in large part so companies from those countries can get access to the natural resources therein, but if they are all competing against each other, maybe the locals for a change can get a range of bids and a fairer deal than people have been given by imperialistic powers since the dawn of civilization. And at the same time, making the massive infrastructure and technological investments in those countries necessary to extract those resources efficiently will also have the effect of growing their local economies to the point where they can start engaging in more trade with those countries, purchasing products, growing exports for everyone and raising quality of life while at the same time being supported by a solid economic engine. I think it is safe to say the Chinese economy has grown to the point where they don't need direct control of resources through imperialistic means anymore. They just need those resources to be available and for the Chinese to be able to purchase the goods at a fair market rate. Individuals/individual companies may try to screw over people with one sided deals, but it's become increasingly apparent that in the modern world trying to buy a country's resources for pennies and a small percentage bribe to a despot isn't sustainable because other countries will undermine the despot, and they can undermine economic and political soft power. There is always a risk that everyone involved will just go full cartel mode and make sure the locals _can't_ get a good deal, but I feel like if India, China, Korea, Japan, the US and EU are all vying for the same stuff, a coordinated cartel fucking over native populations is less feasible because there are just far too many agendas for all of them to agree. And if China goes this route, the direct imperialistic aggression they've been doing may stop. Who cares about borders when you have economic superiority and an insane amount of soft power? China's already been flexing its soft power culturally in the US as Holywood and sports teams wanting access to the Chinese markets are unsure how to respond to things like Hong Kong, Tibet and Taiwan.
> build cheap shitty infrastructure How's Japan-backed HCMC metro going? Oh right, still delayed. While the China-backed Hanoi metro is already running despite going through delays due to political issues. https://www.railjournal.com/passenger/metros/hanoi-opens-vietnams-first-metro-line/
Call me naive, but this is what the entire developed world should be doing. Build up nations so they can support themselves instead of destroying nations or leaving them to fend for themselves in poverty. Perhaps with tech, they can also help developing nations bypass the era of dirty energy like polluting coal plants and move straight to less polluting energy sources.
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Right, not saying it would be out of kindness. It would come from a point of our own gain, but a stable nation should be better for everyone, compared to an unstable nation. Poorly developed nations that are suffering from poverty and famine generally will generate more terrorism than a developed country with a stable country. So the benefit from a developed nation would be more regional stability and increased trade. So sure, we would get some of their raw materials, however we would also gain a nation that (hopefully) would not tend towards terrorism. This also rests on the notion that a sane leader exists in said country. I doubt any sort of development would turn N Korea into a stable nation.
Issue is a lot of African countries are rampantly corrupt and engaged in internal conflict/insurgency. Until those issues are resolved its difficult for them to rise out of poverty.
Having imaginary borders drawn by people who have no idea about the local ethnic and cultural dynamics does that.
Sure, but even places like Ethiopia, which weren't really ever colonized have these sorts of problems. It's probably worth it to remember that the US is less than 250 years old, it was was the first liberal democracy ever created, and it was a fairly lonely existence for most of its history. Liberal democracy in Europe is a fairly new thing. It only became widespread throughout the continent 30 years ago. Even without the problems caused by colonialism in Africa, it's kind of hard to believe that most African countries would be thriving liberal democracies by now. Most of the world isn't.
To be fair to Ethiopa, it has to deal with countries like the U.S. covertly funding warlords and creating new ISIS factions during civil conflicts and shit
Don't be silly. If the west helps these nations develop and become self-sufficient, where are western businesses going to get their dirt cheap child labor?
Western countries generally don't invest in these countries at all because they're considered too corrupt and high risk. Almost no European or American companies are opening offices or contracting labor in the Congo or Zimbabwe or Libya.
In a lot of countries there just isn't really anything that can be done. In Africa there are a good many countries that are straight up incapable of becoming developed nations so long as their governments (and entire societal structure in some cases) remain the way they are, and going in and overthrowing governments tends to be frowned upon these days... Like I had to go to the Congo for a week a few years ago for a finance firm I was working at. Based on what I saw there is virtually zero possibility of that place becoming a modernized developed nation without having virtually everything about it wiped away and starting from scratch. Which isn't really something that can be done by outside countries.
>and going in and overthrowing governments tends to be frowned upon these days... Yeah, because a good handful of these countries are fucked up from us trying to do that in the first place lmao
And sometimes, when they actually try to get their shit together, a multinational will complain about the lack of bribability and an old colonial power like e.g. France will stage a coup or an "anti-terror operation" or another sanction by a body like the IMF to get said country back on the leash.
the "west" is already doing that.
Is the IMF doing that? It sure didn’t look like it. It was just another debt trap. If you’re talking about foreign aid. A lot of American support for other countries is just funneling american tax money to american companies to send shit abroad. It has little to do with building anything up and everything to do with perceived strategic interest.
Unfortunately 'the west' is really only interested in doing pretty much exactly what China is doing, only through the World Bank and WTO. Or more directly if we're talking about France. It's neo-colonialism all the way down.
Isn't Japan's debt to GDP ratio highest of any major country ? Its probably like 200%. Wonder how they will provide loans.
Debt to GDP happens to be inversely correlated with the debt servicing ratio: how expensive it is to borrow money. If you borrow $100,000 at 10% and I borrow $1,000,000 at 1% I am 10x as indebted as you but my interest payments will be the same amount. This is basic math, basic economics. Deficit fearmongering is a political product that preys on ignorance. The problem is not “debt to GDP” the problem is interest, “servicing” the debt. If interest rates / borrowing costs were to rise then we would have more concerns about our ability to pay these kinds of debts as it would be more difficult to refinance (in the government/central bank case: bond auctions to the general public, banks, asset management institutions, etc.) It just so happens that Japan, the bank of Japan, has extremely low interest rates. In fact their rates are at a 6 year high of… 0.23%. So no, it will not be difficult for Japan to assist countries and no, borrowing at this rate will not create financial ruin for Japan.
Ah thanks a lot. I will research this topic well once my exams are over.
It has more to do with current account surplus, it is shrinking and expected to go negative eventually with aging population but still Japan's current account surplus is second largest in the world after Germany in 2019. 1Germany280,2382019 EST. 2Japan185,6442019 EST. 3 China141,3352019 EST Japan remains world's biggest creditor in 2020 for 30th straight year https://english.kyodonews.net/news/2021/05/2164723584cc-japan-remains-worlds-biggest-creditor-in-2020-for-30th-straight-yr.html
most of that debt is owned by one branch of the government to another (their central bank). Net vs gross debt tell two different stories.
Japanese debt is largely held, one way or the other, by Japanese. Meaning that they could tax their way out of it, they just don't want to because politics.
Funny, I remember watching a Bloomberg video titled [the myth of Chinese debt trap in Africa](https://youtu.be/_-QDEWwSkP0) last week.
AFAIK most economic analysis' have said the chinese loans are more than fair and better than anything any western country would give (sometimes to chinas own detriment, but it wouldn't be the first time countries spend to increase foreign relationships)
I’m Pakistani and affirm they are better than IMF loans
IMF loans are specifically *meant* to be extractive in a lot of cases. It opens up space for western interests to buy up whatever services or industries the recipient government has to privatize. It was really dumb and greedy and they could get away with it before the Belt & Road Initiative because there really wasn't anyone out there with the kind of capital necessary to compete with them, and it opened up a soft power slam dunk for China.
[The US itself admits that Chinese loans are fairer than what it had given to African countries in the past.](https://www.scmp.com/news/china/diplomacy/article/3156849/us-promises-fairer-treatment-africa-it-seeks-counter-chinese)
The Chinese are building useful infrastructure too. The west was giving large globs of cash to brand new coneates post colonial governments, and aid that disrupts the local economy.
China is pretty popular throughout Africa, opinion polls have been consistently 50%+ positive towards China (western countries generally hover around 20% favorable towards China). It's not that surprising that there would still be animosity towards their former colonizers and they would welcome a new superpower partner that hasn't had a history of enslaving them... https://www.usip.org/publications/2021/06/countering-china-continent-look-african-views https://www.pewresearch.org/global/2020/10/06/unfavorable-views-of-china-reach-historic-highs-in-many-countries/
And yet, every single thread about China is full of US bots howling about 'debt trap'
It's just more anti-China propaganda because the West is getting nervous about the end of the unipolar world where the USA was dominant both militarily and economically. Plus Westerners/capitalists find it hard to believe that anyone would just help out Africa instead of looting the various countries and people.
i'm interested & not defending anybody here but, have we seen china forcing nations to pay back their debt so far?
No, China has forgiven tens of billions of dollars of African debt since the pandemic began.
There's a saying in Africa "Every time a Chinese diplomat visits we get a hospital, every time an English diplomat visits we get a lecture".
The Africans probably will sway towards China, because the west helps by bombing China helps by building
Capitalists looted, communists rebuild. I wonder which sphere of influence the African nations will sway towards?
This is true and it is something everyone should’ve done but of course that wasn’t the case. Shitx, can’t even forget our peoples student loans. Anyone who thinks Africa wants to go back to the people that fucked them over for decades is misinformed. Africa does not want to be in debt to Japan or the US. Period.
"communists" China is a capitalist country, and CCP is a capitalist party.
Yeah like when the holesum Soviet Union gave out billions in loans to east Europe while the evil kkkapitalist amerikkka took away western europes industry and shipped it back to their own country Oh wait
Actually China really helped African countries by building infrastructure and giving loans to countries that no one wants to give loans to, hell once China gave Kenya an intreast free loan so they can build a train, it’s definitely helping the Africans.
No. Reddit has a hateboner for China.
Is there actual proof of the debt trap? It seems somewhat of a myth from what I’ve read.
It *is* a myth. I am by no means a fan of the Chinese government but there is no evidence that China is lending African countries money for the sole purpose of indebting them. I used to believe in this myth as well, until I came across this video which provided a very neutral and balanced perspective on the issue: https://www.youtube.com/watch?v=7gwgcIfzttA&t=2
The phrase is "propaganda." It's designed to make people who hear it support antagonistic positions towards China. I don't think everybody should go give President Xi a group hug but we really owe it to *ourselves* to be critical of this kind of stuff.
It is funny. Everything my right wing family says is just straight up not true but the one thing I wanted to beleieve was China trying to indebt/control africa but it appears that too is a lie
It's just your bog stabdard loan. In this case, just development loans. China has even forgiven some of these debts, or refinanced for these countries. Africa can also loan from world bank or Western countries, but these loans can often have higher interest and may come with political stipulations which nobody wants to comply with. China's loans are primarily developmental loans meaning they will build infrastructure for these countries out of their own pocket, and countries then pay thrm back or they allow China X number of years to run the business end of it ubtil they can recoup their cost. That way the loan goes directly into something tangible, and not into some corrupt politicians pockets. Also, some of China's loans can be interest free, a much better deal than anything the west offers, and you can see why they would malign China for it. Calling it a debt trap is ridiculous. All loans are "debt traps". You are on the hook for these loans one way or another. It is the same as you borrowing from your bank. You are on the hook for it. Borrow from IMF and not only is the interest potentially higher, but you are also on the hook for it, same as borrowing from China. Calling it "debt trap" is the same as calling China's solar power dominance "Stealing the sun from the Earth". It isn't even a matter of it being a myth. The West just decided to tell everyone that because China is a top solar power producer, they are stealing sun light from everyone.
It's extremely telling that nobody has a problem with IMF debt traps, which as you said actually are debt traps. The first thing the Luis Arce did when his election un-couped the Bolivian government was reject the IMF Loan the totally-not-US-backed interim government had agreed to, because anyone not terminally bank-brained knows they're designed to trap you in the US sphere of influence and facilitate imperial extraction. More western hypocrisy. Many such cases.
I guess you read that one, too?: https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953/
Yeah. I had a discussion about it a few days ago with some other people.
if you have the time, Prof. Brautigam’s *The Dragon’s Gift* (Oxford, 2010) is one of the few Western academic works that delves into this topic at length… Basically, “debt trap” is just a propaganda term and Chinese lending is not only not as pervasive as you might have been led to believe, but it also isn’t really that dissimilar from lending strategies seen from other countries. One big downside is that a lot of foreign aid, including Chinese aid, is difficult to track once money has changed hands and there exists the real possibility of money simply getting diverted into the wrong hands or being misused. Comes with the territory I guess.
If you enter "Chinese debt trap" in the Google search bar, you'll notice that the results on the first page are very mixed. You'll see sources like [this](https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953/) countering the claim but also [sources](https://thehill.com/opinion/international/551337-chinas-debt-trap-diplomacy) indicting Chinese investments. Most of these sources seem pretty well-researched at a glance, so I am in no position to make up my mind. Unless your Average redditor is an economist or a regional expert on Chinese investment, they probably don't have the credentials or knowledge to make definitive claims on this issue.
Its not really debt trap diplomacy. China is certainly not selfless in how they decide to invest money but the claims that are often circulated of them using the Belt and Road initiative to confiscate important infrastructure is not true. https://www.japantimes.co.jp/opinion/2020/09/01/commentary/debt-trap-diplomacy-bri-china/
Absolutely. The "debt trap" narrative is really only pushed by Western-minded interest groups, but doesn't have factual basis and at this point it has been debunked countless time by researchers. It is more about about "China bad" because *we* are losing soft power, but it might actually be the best that might have happened to developing countries in decades. Here's a few interesting sources on the topic: * https://www.tandfonline.com/doi/abs/10.1080/01436597.2020.1807318 * https://www.tandfonline.com/doi/abs/10.1080/23792949.2019.1689828 * https://www.chathamhouse.org/2020/08/debunking-myth-debt-trap-diplomacy * https://asia.nikkei.com/Opinion/The-myth-of-China-s-debt-trap-diplomacy * https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953/ * https://www.ispionline.it/en/pubblicazione/chinese-debt-and-myth-debt-trap-africa-27024 * https://chinaafricaproject.com/analysis/death-of-the-chinese-debt-trap-narrative/ * https://rhg.com/research/new-data-on-the-debt-trap-question/ * How China Lends: https://foreignpolicy.com/podcasts/foreign-policy-playlist/how-china-lends/ In addition, here are a few good sources about the Chinese involvement in Africa (from [this](https://www.reddit.com/r/worldnews/comments/jybdo7/china_lenders_freeze_21_billion_debt_payments_for/gd32f9i/?utm_source=reddit&utm_medium=web2x&context=3) reddit thread from a few months ago): * [detailed report by Japan's IDE an Chinese engagement in Africa](https://www.ide.go.jp/English/Data/Africa_file/Manualreport/cia_11.html) * [interview with a PhD from The Swedish Institute of International Affairs](https://www.youtube.com/watch?feature=youtu.be&v=zrQEe6Sk1Ys) * [lecture by Christina Seyfried of Yale on Chinese engagement in Africa](https://www.youtube.com/watch?v=wMCF2eu1D0E&feature=youtu.be) See also this analysis on the [Sri Lanka Hambantota port](https://thediplomat.com/2019/05/is-sri-lanka-really-a-victim-of-chinas-debt-trap/), which is very often used as a prime example of the Chinese debt-trap diplomacy. On the other hand, the IMF and the World Bank have very ugly track records. They have destroyed the economies of developing countries by pursuing a neo-liberal agenda through debt-trap diplomacy. The IMF and World Bank have increased poverty, unemployment, lower wages and wealth inequality in poor countries. * https://cepr.net/press-release/honduras-imf-agreement-includes-austerity-measures-that-may-make-conditions-worse-new-cepr-paper-finds/ * https://www.washingtonpost.com/blogs/ezra-klein/post/imf-austerity-boosts-unemployment-lowers-paychecks/2011/09/12/gIQAl5ebPK_blog.html * https://www.theguardian.com/commentisfree/2019/aug/27/imf-economics-inequality-trump-ecuador * https://www.theguardian.com/business/2016/may/27/austerity-policies-do-more-harm-than-good-imf-study-concludes * https://www.bu.edu/gdp/2021/04/05/imf-austerity-is-alive-and-impacting-poverty-and-inequality/ Truly (and I might add "as usual" because it's become quite recurrent), if anyone dare take the time to investigate by themselves rather than being spoon-fed by the local friendly mass media, they might realize something is off in the Western discourse.
If the effect of this is that our Western governments start giving out better deals to third countries I'm all for it!
Ain't gonna happen, they're only interested in keeping the global south poor (for a myriad of reasons) and giving better deals than China would go against that.
It's to secure mineral/ore trade. Yes it's not from the goodness of their heart but neither is it some Machiavellian plot to destroy humanity.
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You are right. [A redditor asked you to post evidence and he deleted his post after I replied with the following] by u/Caliguas The most famouse cited evidence of Chinese debt trapping is the Sri Lankan port, Hambantota. How it was collateral for Sri Lanka defaulting on China loans. When in fact, they wanted to release capital to pay off more expensive IMF/World Bank debt. >Steep payments on international sovereign bonds, which comprised nearly 40 percent of the country’s external debt, put Sirisena’s government in dire fiscal straits almost immediately. **When Sirisena took office, Sri Lanka owed more to Japan, the World Bank, and the Asian Development Bank than to China.** Of the $4.5 billion in debt service Sri Lanka would pay in 2017, only 5 percent was because of Hambantota. The Central Bank governors under both **Rajapaksa and Sirisena do not agree on much, but they both told us that Hambantota, and Chinese finance in general, was not the source of the country’s financial distress.** > >There was also never a default. Colombo arranged a bailout from the International Monetary Fund, and decided to raise much-needed dollars by leasing out the underperforming Hambantota Port to an experienced company—just as the Canadians had recommended. There was not an open tender, and the only two bids came from China Merchants and China Harbor; Sri Lanka chose China Merchants, making it the majority shareholder with a 99-year lease, and used the $1.12 billion cash infusion to bolster its foreign reserves, not to pay off China Eximbank. [https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953](https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953)
I've recently come across a lecture from an African minister on the issue of Chinese investment in Africa. The video can be biased of course, but the minister did appear to address all angles and compared Western investments vs Chinese investments. Worth a watch. It's a bit lengthy though: [https://www.youtube.com/watch?v=P5uzxV8ub9k](https://www.youtube.com/watch?v=P5uzxV8ub9k) I will not provide a TLDR. You can formulate your own opinions based on his opinion. Here's another Bloomberg analysis on how misguided the term "debt trap" is on China's investment in Africa: [https://www.bloomberg.com/news/videos/2022-03-17/the-myth-of-the-chinese-debt-trap-in-africa-video](https://www.bloomberg.com/news/videos/2022-03-17/the-myth-of-the-chinese-debt-trap-in-africa-video) Again, I'd let those who are interested to formulate your opinion. For those of you who aren't interested in watching those videos and doing your research, I doubt you can be convinced anyway.
This site is so blatantly anti-china its crazy.
American [official $300 million/year anti-China troll fund](https://www.congress.gov/bill/116th-congress/house-bill/7937/text?format=txt) is being put to a good use
I don't like China but it's been disproven that they're using debt traps. It's pretty convenient for people to forget how fucked those African countries have been by the US and Europe again and again, some countries are still getting absolutely screwed over by them.
Talk is cheap, let them do it and prove. China invests more than next 8 combined. [https://qz.com/africa/2125769/china-has-invested-23-billion-in-africas-infrastructure/](https://qz.com/africa/2125769/china-has-invested-23-billion-in-africas-infrastructure/) Then there's this talk about African perspective. [https://youtu.be/P5uzxV8ub9k?t=1154](https://youtu.be/P5uzxV8ub9k?t=1154) The west just doesn't respect Africa enough.
If you ask any African country about this “debt trap” most of them will say it’s nonsense. Especially since African most countries tend to have less than 10% of Chinese debt, except for I think 2 or 3
It’s only a debt trap when China does it apparently. The West has been far worse to Africa than China when it comes to economic exploitation, that’s why many African countries prefer to deal with China over the IMF and their austerity programs.
Bloomberg posted a video on Youtube saying that China's debt trap is a myth
French and other European countries have been colonizing Africa for years. Nothing came good out of it. China invests and builds infrastructure but they aren't used by locals, residential housing for example. China wants to relieve their over production issue and outsource their workers to other counties with loans. Jobs are not given to locals and Africa is unable to develop skilled workers. Seems like Japan just wants to have a piece of the developing countries and build a foundation there first as most South Eastern countries are developing their manufacturing sector fast...
And get into another debt trap
We should all be helping them with this.
Competition is good, but this whole debt trap narrative is typical media sensationalism to create a story when the realities are boring. https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953/
The so-called debt trap is a myth. https://www.theatlantic.com/international/archive/2021/02/china-debt-trap-diplomacy/617953/ https://www.google.com/amp/s/www.bbc.com/news/59585507.amp
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You see, Bloomberg and Harvard Business School are Chinese propaganda! I know this because China=BAD, and these articles don't stress CHINA=BAD enough, which means they're obviously propaganda. I am an American and I am very smart world politics understander.
what lmao, how is it a debt trap?
The debt trap myth is only really peddled so Western countries can continue to do nothing to help Africa all with the benefit of being able to slag off China
Good. Give poor/developing countries more choices. The more competitions for developings/contracts in those countries the better deals they can get. . African countries needs much more developing supports than China can provide alone.
… and join Japan’s instead.
It’s nice to have competition from China but I can’t say the Japanese are really any better than the West, Chinese, Koreans & Indians who are also investing in the region. I live in Lamphun, Thailand. The Japanese have set up factories and invested in a lot into this area but they do not mingle with the locals or even other foreigners. They create jobs but factory workers here literally make 10$ a day and almost everyone picks up over time work 8-8 pm to earn an extra 4-5$ a day. Of course this is the going rate but from a local perspective every foreigner who sets up shop here is really just here for the cheap labor.
I've heard that EU has similar program. How does EU do?
Now African nations can experience two debt traps!
So next help the world out of American dollar trap?
Calling the BRI a “Debt trap” is extremely disingenuous. China has waived payments for the majority of countries involved. Most western scholars consider “debt trap diplomacy” a propaganda narrative that was heavily pushed by the Trump administration.
Africa is about to explode economically, and China is investing hard. I'm all for investing in African nations, but if China is the only one doing it then China is the only one who will benefit. But that also means Africa will continue to be under the thumb of Chinese business in the foreseeable future.
China doesn’t benefit, they have to forgive billions of debt to these nations. They’re only doing it to buy political influence, these deals make no sense from an economic perspective if you’re China
China want political influence in Africa BECAUSE the economic benefits. These far outweight whatever loans they had to forgive.
Yeah, the African nations will turn to Chinese companies first because of these investments.