🦋 Pot Calling The Kettle Black

Apr 24, 2022

The lending by China to developing countries has been demonised by Western countries as if China deliberately enslaved the developing countries in debt so that China could take advantage of them.

The report below which studied such loans to Sri Lanka and Malaysia found that those countries fell into trouble because of mismanagement and corruption in those countries.

🦋 Is a Malaysian. Malaysia under its then Prime Minister Najib Razak gave contracts to Chinese companies at inflated prices.

The government under Najib was unexpectedly toppled in a general election. The new government cancelled some of the contracts awarded by the Najib administration and renegotiated other contracts for lower prices.

Before the Najib administration fell some of the projects had already faced difficulties because of the inflated prices. What the Najib administration did to cover those problems was to give more contracts or sell properties to Chinese companies.

Thus it was not China taking advantage of the debt that China schemed to ensnare Malaysia.

The magnitude of the debt was because of corruption in Malaysia. The new deals that Western countries allege is China taking advantage of Malaysia are efforts by corrupt Malaysians to cover problems caused by their past corrupt practices.

When Najib was still in power he removed the Attorney general of Malaysia and senior Anti Corruption officers who were investigating his involvement in the infamous 1MDB case where Malaysia lost billions. He replaced them with cronies that exonerated him.

But after his administration was overthrown, Najib was convicted on the 1MDB case.

Money is powerful and Najib is trying to make a political comeback as well as appealing his conviction.

He could possibly succeed as all the opposition parties with different ideologies had combined to topple the Najib administration.

The ideological differences made it difficult for them to remain united and they broke up.

Now Najib's party and some other parties willing to back his party for political favours or government positions is back in power.

As China increases lending to other developing countries, charges that these loans lead to a “debt trap” are growing quickly. As it greatly augments financing for development while other sources continue to decline, condemnation of China’s loans is being weaponised in the new Cold War.

www.theedgemarkets.comMy Say: In the new Cold War, a ‘debt trap’ label for Chinese loansAs China increases lending to other developing countries, charges that these loans lead to a “debt trap” are growing quickly. As it greatly augments financing for development while other sources continue to decline, condemnation of China’s loans is being weaponised in the new Cold War.

The Edge is a media group who played a significant part in disclosing information on 1MDB.

Now let us look at what the Western countries acting through the IMF has done to debtor countries.

Substantial parts of new loans or bail outs by the IMF goes to repayment of Western creditors of the debtor countries.

Those new loans come with conditions like austerity measures and higher taxation.

These conditions cause much hardship to to the citizens of the countries while the old Western creditors get repaid by the fresh loans provided by IMF.

These additional loans further ensnare the debtor countries into more debt.

They may need another bail out again. Greece is an example of a country that IMF had "helped" several times.

Ironically, Greece is a Western country. Western countries could do to other countries including one of their own what they accuse China of doing.

A case of a Pot Calling The Kettle Black.🦋