China's loans pushing world’s poorest countries to brink of collapse

This article has one-sided view. Nothing mentioned about the majority of the debts were owed to the West. Those countries have always been poor without any way out, but China helped them develop and see some lights at the end of the tunnel. They are suffering right now because the West have raised interest rates so much that led to hyper-inflations in their countries.

So much for China being a humble banker. More like a drug dealer, to be honest.

That was the entire point. Foist loans on these countries that the tyrants running them could grift, and when the country can’t make the payments, enforce 99 year lease provisions on deep water ports or exclusive mineral rights to precious resources.

It was like a drug dealer giving away the first hit of smack for free. The endless cycle of depress the ultimate goal.

This article has one-sided view. Nothing mentioned about the majority of the debts were owed to the West. Those countries have always been poor without any way out, but China helped them develop and see some lights at the end of the tunnel. 

The data is clear that China lends more to developing countries than the World Bank or any other nation or institution. But while the World Bank lends on the condition the recipient nation undertake specific governmental and financial reforms they help them with, China does nothing to help the nations it lends to. World Bank wants nations it lends to to reform so they can pay their loans back and avoid getting in debt in the future. China does no such thing with its loans and often makes conditions worse for its borrowers.

DAMN YOU, Autocorrect!

"The endless cycle of dependency is the ultimate goal."

Apologies.

“ . . . from the world’s biggest and most unforgiving government lender, China.”

Yuck!

They are suffering right now because the West have raised interest rates so much that led to hyper-inflations in their countries.

The West re-structures loans and even forgives some of them - China does not

Why do ya think China is so secretive about these loan contracts to the people of the countries? Don't the taxpayers of those countries deserve to know what their government is signing their tax money into? Yet China forbids those countries to disclose these secretive loan contracts to their own people.

It took a government change in Kenya to finally expose these secretive loan contracts to their people. And it shows why China is so secretive:

"Kenya: Why is the government hiding its Chinese loan contracts?"

https://www.theafricareport.com/125090/kenya-why-is-the-government-hiding-its-chinese-loan-contracts/

A growing number of Kenyans are becoming increasingly incensed with Attorney General (AG) Kihara Kariuki for his determination to challenge activists’ demands in court for disclosure of the $3.2bn Standard Gauge Railway (SGR) contract with China. The move didn’t go down well with many people who felt betrayed and wondered why the government’s top lawyer is so determined to keep this information locked up and he is acting in violation of the same constitution that he’s supposed to uphold.

The Kenyan constitution under article 227(1) and the public procurement and disposal act 2015 stipulates that public projects must be made public and requires public participation in the process.

Legal issues aside, the fact that the contract is being kept from the same people that are supposed to bear the burden of the loan raises more questions than answers. The obvious question is why is the SGR project shrouded in so much mystery?

"Kenya publishes loan documents for Chinese-built railway"

https://www.reuters.com/article/kenya-china-debt/kenya-publishes-loan-documents-for-chinese-built-railway-idINL8N3234AQ

The government of Kenya’s new President William Ruto has released loan documents related to a controversial Chinese railway that his predecessor’s administration fought a years-long battle in the courts to keep secret.

So, finally there's some exposure on what those country's people's tax money are being used:

"China’s secret loan contracts reveal its hold over low-income nations"

https://www.ft.com/content/7e98795f-159b-4455-903e-6e21c345d4a9

They analysed 100 contracts between lenders such as the China Export-Import Bank and the China Development Bank and 24 developing countries including Argentina, Ecuador and Venezuela, all of which have defaulted in recent years, and several countries in sub-Saharan Africa.

All contracts signed since 2014 — 38 of the 100 — contained far-reaching confidentiality clauses that make it hard for other creditors to ascertain the true financial position of the borrower. This means that “citizens in lending and borrowing countries alike cannot hold their governments accountable for secret debts”, the researchers warned.

Several contracts exerted influence over borrower countries’ domestic and foreign policies. These included cross-default clauses triggered by any action seen as adverse to the interests of “a People’s Republic of China entity”

Many of the contract terms were unusually strict and gave Chinese loans priority for repayment while prohibiting borrowers from restructuring their Chinese debts in co-ordination with other creditors

Close to three-quarters of the contracts contain what the report terms “no Paris Club” clauses, which expressly commit the borrower to exclude the debt from restructuring by the Paris Club of official bilateral creditors.

For a loan contract, this is even more suspicious since that prevents the borrower from using outside help to pay back their debt, like using other banks or the IMF or World Bank funds

No wonder China wants to keep these loan contracts secret, but it's those country's people's money!

Example: "China has been criticised for its role in recent sovereign restructurings such as Zambia, where some bondholders resisted a reduction in their interest payments because they suspected the savings would be used to service the country’s Chinese debts."