CPEC Debt trap: A myth or reality

CPEC Debt trap: A myth or reality

BEIJING – Chinese Foreign Ministry spokesperson Hua Chunying on Friday criticizing the Western media for its so-called “China debt trap theory”, said that the proportion of the Chinese loan to some countries including Pakistan was generally not high.

Addressing a press briefing in Beijing, Hua Chunying said that as per data from the Pakistani government, 42percent of Pakistan’s long-term debt comes from loans from multilateral institutions, and Chinese loans account for only 10percent.

She said the preferential loan rate offered by China to Pakistan was about 2pc, which was far lower than the loans provided by Western countries to Pakistan. “I think these numbers are very illustrative.”

The spokesperson said that indeed, the proportion of Chinese loans to the foreign debt of the countries concerned was generally not high, adding, “I don’t know where the so-called “China debt trap theory” of some Western media hype comes from.”

She said according to the statistics of the Sri Lankan central bank, loans from China accounted for only about 10% of Sri Lanka’s external debt in 2017, of which 61.5% were concessional loans below the international market interest rate.

“Chinese loans do not constitute the main burden of Sri Lanka’s external debt,” she added.

Sri Lankan officials had long publicly stated that there was no such thing as a “debt trap” in the port of Hambantota, she said.

Hua Chunying said there were also some media that were concerned about the debt problems of African countries.

“As everyone knows, the African debt problem has a complex historical background and reality. In essence, it is not only an economic and financial issue but also a product of an unjust and irrational international economic order,” she added.

The spokeswoman pointed out from 2000 to 2016, China’s non-loan loans accounted for only 1.8% of Africa’s total external debt, and it was mainly concentrated in industries such as infrastructure.

“So far, no African country has complained because it is in debt crisis because of cooperation with China. On the contrary, many African leaders have positively evaluated China’s cooperation in Africa’s investment and financing, and look forward to expanding cooperation with China”, she added.

“Yesterday, when I answered the question about the “debt dilemma” of the South Pacific island country, it was said that the same funds, how the funds of the Western countries are sweet “pies”, and what China has provided become a dark “trap”? ! This is unreasonable,” she added.

Hua Chunying hoped that some countries, people and the media in the West could objectively and fairly view the cooperation between China and relevant countries. -APP