MUNITY East 2019 Pre-Conference Issue: Two Sides of The Same Coin

Debt Trap
THE CHINESE
STRA
Some experts suggest that recently, China has taken
its place around the monopoly board and has played
its turn with one goal- to gain economic and political
recognition across the Asia-Pacific region and the
world. This recognition could be in the form of ascendancy.
In order to achieve this, China is splashing
out billions of dollars across the globe on concessional
loans to developing countries for infrastructure
projects.
The concessional loans are part of President Xi Jinping’s
flagship economic policy, the ‘One Belt, One
Road’ initiative. The initiative was unveiled by the
President in September and October 2013 during
his visits to Kazakhstan and Indonesia. Xi set up a
US$40 billion Silk Road infrastructure fund to kickstart
the project. It covers 65 countries over three
continents. The strategy was first viewed as China’s
Marshall Plan to aid development in Central Asian
countries and build relations with its neighbours in
exchange for the natural resources needed for China’s
growing economy.
However, according to ‘Global Risk Insights’, experts
warn that the loans Beijing is offering are
entrapments to gain influence of power over the
world. How exactly do they argue it works? Poorer
countries are often enticed by China’s offers of
cheap loans for transformative infrastructure projects.
When these countries are unable to keep up
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