Japan to help African countries escape China's 'debt trap'

"debt trap."

This is how china, England, France, Spain, Portugal, colonized half the world by lending $$$ to thugs and corrupt leaders of developing country's then asked them to payback or face complete colonization or occupation.

China learned from the west the principles of COLONIZATION.

Japan to help African countries escape China's 'debt trap'

.....and what does Japan want in return?

The terms are with lower interest rates and longer terms. IMF and the World Bank are not as competitive as the Chinese banks.

"We will facilitate the environment in which (developing nations) do not have to depend on such financing,"

Unless you cancel their debts this essentially means refinancing available: we will offer you our loans. You can have your debt with us.

Many countries have cancelled unpaid African debts. When it becomes clear that a country has no capacity to ever pay, there is little else to be done. China at least leases the collateral and make the payments. That’s like instead of a bank repossessing your non-performing property, it signs a contract and pays you as the tenant and you keep the property.

Without debt traps from the West, neither China nor Japan would have been able to develop in the time frame it did.

China is learning, as Europe and America did decades ago, to be cautious in to whom they lend money.

Alan Harrison

Japan to help African countries escape China's 'debt trap'

Obviously, a world in which people do not have to rely on authoritarian regimes for their livelihood - the world that is more free and less authoritarian.

So my living expenses are up over 20%, I can’t find work, we just gave America a bus load of money, and now, we are giving a lot more to some far flung countries on the other side of the world, countries that most Japanese have never heard of. Just to keep American foreign policy against our neighbor and best trading partner, China.

Noble intentions but impossible to stop China's corrupt practices.

China doesn't just go to the debt market and offer help, it bribes officials to employ Chinese construction companies to build infrastructure projects that doesn't stack up. The country go into debt, but officials and their cronies profits handsomely with accounts in the Cayman islands etc. China is merely adopting the model Marcos used to bankrupt his country.

Just one example:

https://www.nytimes.com/2018/12/24/world/americas/ecuador-china-dam.html

"The annual white paper on development cooperation issued by Japan's Foreign Ministry earlier this month says the international community has been condemning "debt trap" financing, which saddles recipient countries with loans they cannot repay, in a veiled reference to China's huge infrastructure projects in developing nations."

If there's anything Japan knows well about it's "debt trapping". Just ask the people who get duped into coming over on the intern program. Now we're supposed to believe they are trying to prevent it?

And that means a bigger debt trap to replace a previous one, there is nothing free and nothing is a charity!

I pity the African countries,has no idea about what is real! No contribution no rewards!

Japan being a good global citizen, cleaning up after another makes a mess. Well done Japan.

When other countries have done this it was ok but China now is some sort of pariah . So self righteous…

Good for Japan.

Japan should give third world nations interest free loans to undercut China's offerings, with no time limits to repay. Its called being a responsible world power.

There is a scam here called 'debt repayment companies'. The marketing says they will help 'get you out of debt by consolidating payments down to 1, where they pay the other companies for you. So instead of you writing 5 cheques for $100/month, you write 1 cheque for $510 to the repayment company. Plus they hold the money for 2-4 weeks before paying the other companies.

It's a dependable business for people bad at math.

OTOH, they do teach some budgeting techniques and make a few phone calls to get interest rates reduced 1-10% by the companies owed. And lastly, the councilor acts like a parent, takes the credit cards away from the children, then cuts them up, in theory to prevent any added use.

The simple idea of only paying with cash you already have really is the lesson.

When other countries have done this it was ok but China now is some sort of pariah . So self righteous…

It is bad for everyone. Eventually, China is left with land and no skilled workers.

They've shipped in their own people to build the infrastructure AND all the support people. China actually ships cooks in who will make Chinese food for the other workers. Seriously.

The infrastructure is often low-quality (all to common with Chinese building projects), but with huge debt from all the middle-men getting their 1%. The country can't repay with money, so the loan goes into default and only political favors remain. That's how Taiwan is being blocked from many contract bids around the world.

There isn't any money left to bring those workers or the support people back to China. It is a 1-way trip. That's fine, if that was the goal of the Chinese people transferred. I suspect it wasn't mentioned. It isn't like a cook with a wooden stall outside a building construction site has money to take his wife and 2+ kids on a flight back to China and setup a new household.

What comes immediately to mind, upon reading this story, is that this is a good thing.

On one hands, China didn't force anyone to take the money. It is being giving with a quick eagerness and friendliness that just isn’t seen in modern times; definitely not by anyone who calls him/herself a “banker.” Plus a small legion of eager faces will show up at your airport to get things started. What's not to love?

On the one hand, China is a rogue donor and loaner from long past.  Meaning that their development loans and investments, like other parts of their economy, is still considered a state secret, as is the overall goals and strategy behind it all.  History shows us that the lack of transparency in such areas will very often foster fiscal abuses and corruption.

And China does have an unfortunate history of dumping lots of money into undemocratic and corrupt governments, just to promote their own internal growth and access to natural resources from others on the cheap.

On the other hand, some of these loans are for strange projects, where huge amounts of funds were advanced on projects that have yet to see much use after completion. Some seaports and railways go to nowhere. Some of it also suffers from poor construction in the hands of their country’s contractors and sub-contractors (collapsing bridges, condemned buildings, etc.).

On the other hand, money from western countries have long and complaicated accountability strings attached, as well as expectations as to how the work is done and when it is finished. China, for the most part, doesn’t.

On the other hand, the loans being handed out by China received the Seal of Approval from international fiscal organizations, of varying degrees from the likes of The World Bank. They have, in fact, co-financed some of it.  And on other occasions their officials have actively encouraged countries to enter into these agreements.

On the other hands, it is hard to feel too sorry for countries in the trap, since their finance ministry obviously didn’t read the four corners of the agreement, and signed unto (unbelievable) ambiguity as to what was owed, by whom, and when. End of the day: who are we to bail them out?

And while we are at it, anyone in their foreign ministry who hasn’t been living under a rock these past years must not be permitted to claim incredible innocence over what would REALLY be expected of them by taking the money.  Debt would/could be the least of their long-term worries.

And dealing with China on any business level means that you must turn a blind eye to some of the worst of humanity on the autocratic level, shown in the past several decades, by your new best friends. Convenient, though, if you own country’s track record isn’t too keen on civil or human rights, as well.

Overall, trying to persuade nations to kick their Chinese money habit is worth a try. Just don’t expect too much.

Corrected version:

What comes immediately to mind, upon reading this story, is that this is a good thing. But its complicated.

On one hand, China didn't force anyone to take the money. It is being giving with a quick eagerness and friendliness that just isn’t seen in modern times; definitely not by anyone who calls him/herself a “banker.” Plus a small legion of eager faces will show up at your airport to get things started. What's not to love?

On one hand, China is a rogue donor and loaner from long past. Meaning that their development loans and investments - like other parts of their economy - is still considered a state secret, as is the overall goal and strategy behind it all. History shows us that the lack of transparency in such areas will very often foster fiscal abuses and corruption.

And China does have an unfortunate history of dumping lots of money into undemocratic and corrupt governments, just to promote their own internal growth and gain access to natural resources from others on the cheap.

On one hand, some of these loans are for strange projects, where huge amounts of funds were advanced on projects that have yet to see much use after completion. Some seaports and railways go to nowhere. Some of it also suffers from poor construction in the hands of their country’s contractors and sub-contractors (collapsing bridges, condemned buildings, etc.).

On the other hand, money from western countries often takes a long time to receive, and has long and complicated accountability strings attached, as well as expectations as to how the work is done and when it is finished. China, for the most part, doesn’t.

On the other hand, the loans being handed out by China received the Seal of Approval from international fiscal organizations, of varying degrees, from the likes of The World Bank. They have, in fact, co-financed some of it. And on other occasions their officials have actively encouraged countries to enter into these agreements.

On the other hand, it is hard to feel too sorry for countries in the trap, since their finance ministry obviously didn’t read the four corners of the agreement, and signed unto (unbelievable) ambiguity as to what was owed, by whom, and when. End of the day: who are we to bail them out?

And while we are at it, anyone in their foreign ministry who hasn’t been living under a rock these past years must not be permitted to claim incredible innocence over what would REALLY be expected of them by taking the money. Debt would/could be the least of their long-term worries.

And dealing with China on any business level means that you must turn a blind eye to some of the worst of humanity on the autocratic level, shown in the past several decades, by your new best friends. Convenient, though, if you own country’s track record isn’t too keen on civil or human rights, as well.

Overall, trying to persuade nations to kick their Chinese money habit is worth a try. Just don’t expect too much.

Newt Gingrich wrote a book recently ("Trump vs. China"). I know some of you are probably thinking, Oh, no! Another book about how wonderful Trump is! Yuck! But it's not like that at all. It's mostly about China and what they're doing to become #1 in the world. Anyway, Gingrich talks a lot about this issue on how the Chinese would love nothing better than to make slaves out of the Third World. The book is very interesting and informative.

It always seems that the west forgets its history of exploitation ect when it comes to China.

Don't fall for it Africa. China looks down their nose on everybody, especially the needy and desperate.