More countries are struggling to pay back debts denominated in USD as the US is hiking its interest rates.....! This should have been the title of this clip.
... particularly given this is nothing like what IMF and World Bank, controlled by the WEST, have been doing for decades to developing countries .... wait .... that is precisely what IMF and World Bank were doing all the time to the developing countries. What a hypocrisy
What worries me, as a South African, is what deals have been made with China to access borrowed money and the consequences to our society in the medium and long term.
Argh shame and are you also soooo worried about all the debt that has been forced on us from mostly Western lenders (IMF, World Bank and private) who are actually extremely predatory (double the interest rates, zero debt forgiveness, little to zero infrastructure development and forced austerity) or is all your worry reserved for the Chinese?
I’d also like to add that Chinese loans are more mutually beneficial and focus on long term economic development rather than privatisation of natural resources and wealth & labour extraction for short term profits for the elites in the north. The Chinese also don’t meddle in the internal political affairs of other states…everything I stated here is factual and information is easily accessible btw.
Without money to develop your own country, what are the best options. Stay poor and lacking infrastructure. IMF is not going to give a free ride. They will dictate on their own terms. That's normal when the country cannot sustain on their own. Unless they want to stay backwards, that's what their people wish for.
@@Anemoia100 All that you say sounds like chinese pro paganda! China communist government is a threat to the people freedom of an indebted nation! Look out when much money is given for loan at a long term! This is a way to keep you tied up by the lender!
@@AndreVasconcelosSaNo one is forced to take loans from IMF but if regular banks refuse to lend because the risk is too high then IMF is the last resort.
Friends bought with money will be your friends so long as you continue to give. By the time you stop, they'll hate you more than those who never helped. True bonds come from similar values.
And some countries who never thought of repaying played friends. Both parties seem happy to continue playing on. But somehow the West is taking this seriously.
True bonds come from interests. There was a time when western people married each other for interests, rather than love or physical attraction. Those were the times where the West developed fastest. Nowadays the West is stucked, because people focus too much on superficial ideals.
@@Khai-Tran all banks do the same. however, BRI is infrastructures , means valuable asset staying in the land of that country, it is much better than bombs from USA.
@@Khai-Tran Developing countries need key infrastructures, such as power station, bridges and roads etc..if there is no war, in most of case, these countries can pay it back. developing countries mean opportunities, different from British colonization, Chinese BRI is far more friendly to these countries.
@@Khai-Tran also, when handling the big infrastructures, the Chinese is capable to deliver project on time, it means cost saving to get job done. common prosperity for developing countries and win win cooperation are the key.
Kiva - their interest rates are far higher than China’s and new loans are only to pay off previous loan which is a viscous debt trap. Chinese lend for infrastructure to enable TRADE and progress.
The IMF has their securities exposed. China is very secretive regarding their securities therefore, RMB loans are very unstable as no one but Xi knows the true value. If China has printed more money than securities, borrowers are in big trouble. However, it would benefit the U.S. as they will not be the supplier of money to countries in trouble with interest free or no payback loans/debt. This would eliminate the U.S. deficit completely.
It seemed that China missed a few things to consider with this "BRI" strategy. But with Argentina, twas a big long debt obligation they put their country into
We in Malaysia we did not borrow money from China but we have been asking China to invest in our country. Investment and debt are so different. I don't know why many countries borrow money with China.
Well, investment is one way to say borrow, vise versa, depends on which side you are. For this channel, China has to be evil. So they borrowed from China and trapped in debt.
I'm curious to see if the CCP will keep its word on not attempting to influence the policies of the countries indebted to it. I don't know if that principle has ever been maintained between two countries with such an imbalance of power in their relations.
if they do it'll be a socialist policies which is good for the people not like world bank dismantle public sector and all safety net that government put to protect the poor but the most important thing for CCP is reputation they destroy their economy for it and might doing it again
They do influence already. For example, they can't cast votes at the UN against the official Chinese policies. They may stay neutral, or not appear at the meeting, if China says however the Russian war is good they can't cast votes to condemn the war.
But on the other had China is struggling to pay it's debts back to the world banks etc. China borrowed too much for ventures that would never be profitable. Lots of money going out but little coming in.
Those countries at the end of the day has been helping chinese economy.. those countries pay back loans with high interest rates .. and those projects go to Chinese companies .. they import Chinese goods to those projects .. even labors . Who would at the end of the day benefitted from those
It is certainly not out of a sense of benevolence that China started these lending programmes, but influence most certainly. With loans of billions brings a level of gratitude and perceived friendship, it also includes other likely conditions especially where attitudes towards Taiwan are considered. The Chinese Communist party has done it's level best to isolate Taiwan and influence countries that trade or consider themselves as friendly. There is little difference between the CCP and Chinese banks, so any country that accepts loans or embarks on infrastructure programmes will most likely be 'instructed' to distance itself from dealing with Taiwan. Countries not even on the Belt and Road deal have been threatened with disruptions to their trade situations, when appearing to have opinions on Taiwan sovereignty. If you accept Chinese money, you will undoubtedly have to understand the political strings that come with it.
They own China money. If they don't pay, China will use it's weapons to conquer what is owed to them. They cannot steal China's money that they got from USA jobs and purchases. It must be paid back!
Debt trap or not what has the west offered the developing world compared to China and what have these developing countries have to show for centuries of European involvement?
@@davidnoelfranks1124 most of them are good because they make sure that The said project is profitable so those said countries can pay them back in contrast to Chinese dept which willing to lend even if they think it's a bad idea of a project. so that is why US dept was less worrying.
It was more of an agreement between China and the leaders of those countries, not the people of the countries. So, write it off. Many of these agreements were with corrupt leaders that took bribes for signing the contracts. Why should the people of these poor countries continue to pay these debts off a bad deal. China knew the risk, time for them to take a hit.
@@startracksha The US approach is to do a bailout of the country which is actually a bailout of the US banks that did the loans. In the recent case of SIVB, I would have preferred if they had just let the bank fail but the people with money in it were too powerful to let that happen. I'm just saying what I do when I make a bad investment - I just eat it. I don't whine about it or ask for a government bailout.
Correct your thumbnail and show india's map correctly its very disrespectful and india has not taken any chinese loan and india is not part of Belt and road.
5:10 waiting for Argentina to give back all that money? I foresee no problem at all for the future and I am not reminded of any similare past occurrence
Argentina consistently fails to pay back its loans and has a lot of resentment over them. Ironically it has a lot of good land and an educated population. They’re not the ones who should be failing.
Argentina fails because the income inequality is ridiculous. Same reason why South Africa is failing. Education level doesn't matter if you can't get a proper job with it
Excellent interview and report. This gentleman being interviewed is knowledgeable and explains himself well, concise, I understand him!Very interesting and scary that China is getting such a hold around the world.
So, what if these nations don't repay the Chinese loans? What will China do? I doubt the threat of a poor credit rating will have much impact since it was a poor credit rating that led to the Chinese loans, to begin with. I can only think that the best course of action for the Chinese is to forgive the loans and garner as much goodwill as possible from their borrowers.
@@jeremytine The $148 billion increase in loans at the Discount Window and the $12 billion in BTFP funding amount to $160 billion in new loans that the banks have obtained from the Fed over the past seven days.
@@Interglacial_optimist lol that is different, that is banks taking loans from the fed to make investment. America has 4500 banks if 1000 failed still would not matter.
As an American, can we sign up for the belts and roads program? We obviously won't fix our infrastructure ourselves so maybe China could do it for us lol
You live in a country that is so economically conservative it considers schools lunch for children as a financial liability. With the US being this “patriotic”, you certainly wouldn’t lower down yourself to ask help for a “foreign adversary” would you?
IMF rules include restructuring of the debt in those instances. Chinese loan no one knows as it has clauses who aren't publicly disclosed. It's completely different.
@@mrjerzheel well that's better than to loose an asset for 99 years for a foteign nation, one mind u, authoritarian and toralitarian. Also, private companies produce more development. Governments are horrible managers, invites corruption etc. National companies is no good imo.
Very misleading title. The content is that China is taking a big risk investing in BRI countries to develop their infrastructure. China and its bank faces potential huge loses in these risky ventures, but insead of simply pulling the plug, they restructure the loans or in better risk economies, they continue to pump money. Now which western bank or country are willing to help develop these countries? Even Sri Lanka owes more money to foreign banks than to China.
It is a form of investment with risk/benefit. China has plenty of customers, the big one is U.S., China may be helping a lot of small developing countries, just don't 'assume' such is free lunch.
China is getting the loyalty of these debt trapped countries for cheap when everything is considered. They automatically loses their independence on the world stage. They are for the most part corrupt but rich in natural resources which suits China fine. This strategy is not as reckless as it may appear. Could anyone imagine these countries voting in the UN or other international forums other than in a manner that pleases China and is in its best interest.?
Debts are in stress due to US dollar rising interest rates. EMI increased because of US Fed. They are shifting blame. Dump dollar repay Chinese loan with Chinese currency , problems get solve.
That's it: blame the U.S., they hate everything. How original! China HAS been using their own INFLATED currency. That's why China's economy is crumbling from underneath. Their debt balance looks good on paper, but it's completely false. You can't trick reality forever.
Couple of questions, Why is US dollar rising, or interest rates are rising. All central banks printed and are raising interest rates. Why take loans in dollars and then dump dollars and pay in RMB. What problems get solved?
"Debts are in stress due to US dollar rising interest rates." Belt and Road lonas aren't denominated in USD. Chinese loans are already in Chinese currency.
lol! Nobody wants the chinese currency. It's a grabage currency that nobody accepts. China printed more of their currency than every other country combined in the last few years because their economy is collapsing. If they didn't have strict currency controls, the RMB would be toilet paper.
I remember reading articles about the USA forgiving all foreign debts following WWII excluding Germany and Japan, of course, after we loaned them money to rebuild their infrastructure. The world will never get that level of generosity and forgiveness from China.
If China won WW3, I'm sure they'll forgive all debts. Has nothing to do with generosity and forgiveness. If you let China have a military base in your country and control it (like US in Europe) I'm sure the debts wouldn't matter.
Congress should force the rating agencies to wake up before the IMF sends more US money to bailout these countries. Tell them to ask China for the bailout.
The IMF can't bail them out because China requires that it be the primary creditor. In that situation, any IMF relief would go directly to the Chinese banks to satisfy arrears, which isn't going to happen.
One question though, the bailout you call, how would you know they were not a part of the original agreement in the first place? i.e. it was agreed that the original debt could have been extended by alternative mechanism in the first place.
Could you guys also highlight the activities of IMF. It's the same thing they borrow money and alot of times countries have difficulty with paying back. Same thing different people
"Same thing different people" Not really. The IMF doesn't take infrastructure as collateral, and they don't compel borrowers to use contractors from a specific country or buy equipment from China.
@@wisenber what the IMF does is force countries to change economic and social policy and sell their assets to foreign investors AND have you pay back the loan
@@lemuhuru " No one is putting a gun to anyone head like the economic hitmen at the IMF. " Who at the IMF is using guns? "These countries can take the loan or not under the terms provided." Same with the IMF.
The reason China is refinancing all of these loans is because it'll be a total loss if they have to take ownership of something that isn't making money. They want all these countries to keep making whatever payments they can. You can't sell a port in a foreign country that easily. Especially one that isn't profitable. China has built roads to nowhere so to say.
Exactly how many country in Africa are under the IMF? not to mention that friend still owns and controls mini ports and Harbours in its former colony and also the CFA meanie is in eight different African country.
@@tomtube1012 I read reuters Sept 2022 _China debt restructuring policy under scrutiny_ "interest-free loans make up a tiny portion of China's lending to the continent ... This kind of debt forgiveness, which China has done for more than two decades, masks a harder stance on restructuring for the bulk of its lending to developing nations under its Belt and Road Initiative"
You don't need a study or coding.. which BRI project is actually providing revenue-generating profits to payback the debt at 5% interest? Not a single one.
At least they get infrastructure, after all this time ,other western countries didn't do anything and just take.its not the lender's fault if the countries which borrow the money cannot repay their dept. Why doesn't the world bank lend them the money. Instead they lend it to Ukraine?
Exactly! The West just take and take and take. All talk and no action. You wonder why the Africans are sick of the West and are leaning towards the Chinese.
Srilanka is the biggest example of what china will do in case the borrower country defaults. ( i.e they will take some ports in exchange for its military purpose which was hambantota port in srilankas example)
Sri Lanka only has 11% Chinese debt. Rest is western debt. Sri Lanka didn't have experience to run the port, so they leased it to China. That's it. This so called experts is a clown and brainwashing western masses.
Literally tens of billions of dollars in humanitarian aid; in the form of materiel, human effort/talent, and also cash. Generosity shared by both institutional government , and the common person. Compare this to the concept of “charity” of China, which is culturally and literally virtually nonexistent. I’ve experienced it firsthand. You will often be mocked for suggesting giving away money to help others. This gap in humanitarianism to others is staggering. The CCP apologists love to talk about how per capita GDP of China had caught up quickly ; yet when seen through this lens, PRC’s willingness to help people via humanitarian means becomes even starker . Embarrassingly so , when you look at other still-developing countries (typically democracies ) who do much more.
Just change the headline of the video to "Big Bank Rep Firm complains about competition." They're just hurt because China is beating them at their own game😂😂
The People's Bank of China has already made it clear that One Belt One Road will facilitate the globalization of Renminbi, beginning gradually from its neighboring countries with guarantees of military guardians from China. Then it will replace the US dollar as the unique foreign reserve in all countries. Now the global finance market pegs USD to the gold price after petrol-USD's failure due to the international relationship between the US and the Arabian countries and the unknown output of the petro fields. To conclude, the gold reserve of each country will decide the futuristic FX rate of certain types of currency and it is clear that the cryptocurrency is surreal and is made from computer programs like people trade virtual equipment in WOW.
Chinese lending reminds me of a scam going around Canada. Salesmen sell mentally incompetent/elderly home owners garbage they do not need. Very shoddy jobs, often not hooked up or slapped together with the quality you'd expect from a drunken 12 year old doing work for the very first time. They then tell these incompetent people that they owe them no money, they have them sign mortgage papers and hook them up with a crooked/bribed lawyer who tells them the papers are fine. What they've signed up for is 25% interest bearing mortgages, and in a few years the debt will be worth more than their home, and they will be foreclosed on and lose their home. China just scams on a larger scale, when the small and incompetent nation loses it's home, China gets to foreclose and possess the asset.
China will be the winner, whether this project is successful or failed. if it is successful then China's products have access to more markets and if it failed then will have the leverage to dictate small countries through a debt trap.
They own China money. If they don't pay, China will use it's weapons to conquer what is owed to them. They cannot steal China's money that they got from USA jobs and purchases. It must be paid back!
By these comments seems to me that these bailouts are to be a sustainable income for China, for a long-term hostage of poor and middle-income countries, maintaining them in a poverty cycle preventing them from reaching an advanced economy.
Countries of BRI just broke one by one. Sri Lanka, Pakistan, Argentina, Ankara ... you name it. Then IMF is the victim to bailed them out afterward. Pakistan as an example.
