Asia

Beijing: Last month, Kenyan officials said they would ask China to extend the repayment period on USD 5 billion worth of loans, with an incoming cabinet minister telling parliament that the debt is "choking" the country's economy.According to Nikkei Asia citing research by Johns Hopkins University's China Africa Research Initiative, Beijing's financiers had lent over USD 153 billion to African public-sector borrowers over the past two decades.Only USD 3.4 billion of interest-free debt was cancelled over that period.Earlier, in August, China made an announcement that it would forgive 23 interest-free loans granted to 17 African countries to only show its grip over the east African sovereign debt has become, reported Nikkei Asia.China shows the African countries a dream of bringing Beiji...

The odds of Pakistan’s default on its borrowing are increasing. The country’s risk of default, measured by the 5-year credit default swap (CDS), touched 52.8% recently, a 13-year high, indicating that foreign investors are losing faith in Islamabad’s ability to honour its repayment obligations. The CDS hovered around 5% to 6% before the Covid-19 outbreak in February 2020. It is being increasingly clear that expectations in the Pak economy is not picking up despite the IMF programme of revival and release of USD 1.27 billion tranche.  It could be the result of profligacy and wrong priorities of the Pak government over a period which eventually led to deep rooted structural distortions. Rather than addressing these issues, the Pak leaders are presently engaged in an unending political ...

Berlin, Germany: This move has irked China which has out-rightly rejected Germany's charges, urging later to view its ties with Beijing objectively, reported Voices Against Autocracy. Moreover, at the 20th National Congress in China, the last few sensible leaders in CCP have been removed and Xi Jinping tightened his authoritarian rule and surrounded himself with only "yes men", pushing Germany to re-calibrate its relations with China. While efforts are on to prepare Germany's first China strategy document next year, German Chancellor Olaf Scholz has said that violence must be banned from international relations while commenting on the Taiwan question, reported Voices Against Autocracy. The three-way coalition government that took office in December, is due to publish Germany's...

Pakistan has large amount of debt, high inflation, a spike in unemployment and lot of other macroeconomic problems which shows that the country’s economy is like a ticking time bomb. The factors that contributed to Sri Lanka’s economic crisis have also had a significant impact on Pakistan, whose economy faces similar challenges. The import dependence of essential commodities, limited foreign exchange sources, restrictions on free trade and accumulated external debt are among the other alarming similarities between Sri Lanka and Pakistan.From a critical point of view, China-Pakistan Economic Corridor (CPEC) is built on a $46 billion (now $55 billion) loan that Pakistan received from China as part of its sovereign Guarantee. The initial allocation includes a Chinese loan for $11 billion for...

Islamabad, Pakistan:  Pakistan's economy is like a ticking time bomb. Factors that contributed to Sri Lanka's economic crisis have also had a significant impact on Pakistan, whose economy faces similar challenges. Muhammad Hamza Qamar, writing in Daily Parliament Times said that Pakistan has a large amount of debt, high inflation, a spike in unemployment and a lot of other macroeconomic problems which clearly show the multiple challenges faced by the country. The import dependence on essential commodities, limited foreign exchange sources, restrictions on free trade and accumulated external debt are among the other alarming similarities between Sri Lanka and Pakistan. From a critical point of view, China-Pakistan Economic Corridor (CPEC) is built on a USD 46 billion (now USD...

Xi Jinping secured third term to run the country by drumming up nationalistic sentiments, vowing to make China the most powerful country. However, the country appears to be losing steam on the economic front. China’s exports are declining, industrial output plummeting, and strict lockdowns affecting businesses while the country’s elites are leaving. Xi's dreadful Covid management is adding to the economic problem.  Moreover, with its international coercive policies, hostility toward Taiwan and other neighbours has made China less popular during Xi's tenure. China’s fiscal deficit has reached USD 980 billion thanks to market disruption due to Covid lockdowns, the housing crisis and massive tax rebates. Lisheng Wang, an economist at Goldman Sachs, said “China’s fiscal conditions hav...

Notwithstanding China’s frequent denial of pushing developing Afro-Asian countries into debt trap, Kenya is the new entrant in the list of defaulting countries. The Chinese banks fined Kenya Ksh1.312 billion ($10.8 million) in the year ended June for loan defaults. Kenya defaulted on repayment of the Chinese loans taken to build the standard gauge railway (SGR). The deal to fund the first phase of the SGR, Kenya’s single-largest infrastructure project by cost since independence, saw China overtake Japan as Kenya’s largest bilateral lender.  But the initial jubilation has turned instability The default came in a year when Kenya had asked for an extension of the debt repayment moratorium from bilateral lenders, including China, by another six months. But the lenders, especially Exim...

China's growing presence in the African continent and its rampant illegal mining is posing several social and environmental challenges to many countries. One of the telling examples is gold mining in Ghana. Illegal mining in Ghana has assumed alarming proportions and it is threatening the survival of water bodies. Most of these illegal miners use very dangerous substances like cyanide and mercury in processing their ore, which are not biodegradable and leach into the water bodies creating serious problems for the communities who use these sources of water as drinking water. Recently a Chinese businesswoman, Aisha Huang known in Ghana as “the queen of illegal gold mining” along with three other Chinese nationals was arrested for illegal gold mining, selling and buying minerals without a...

In China, there is a widely popular and frequently used term, Guanxi, which has profound influence on almost all social interactions, whether in government or in business. Theoretically, it is a network of connection and obligation that provide a foundation of societal trust. However, Guanxi in practical sense is a system of mutually beneficial relationship that works as a lubricant for the wheels of business transaction, and is often synonymous with bribery and corruption in China. The system of Guanxi is rampant in Chinese society. Earlier it used to have local implication, but now it has permeated into global markets. Chinese acclimatized to corrupt milieu at home, are now infesting global markets with the system of Guanxi. Kuwait’s Ministry of Public Works recently disqualified the...

The latest Covid outbreak in Tibet Autonomous Region (TAR) and its transmission to different parts of TAR as well as Qinghai, Sichuan and Yunnan Province is a severe blow to the Chinese administration to achieve the annual growth targets. The slowing Chinese economy is grappling with various issues such as unemployment, property market slump and slowing manufacturing. In view of controlling the spread of Covid, the TAR authorities imposed lockdown in all the major cities including Lhasa, Shigatse (Opposite Sikkim), Shannan (opposite Tawang), Nagri (opposite Ladakh and Uttrakhand), Nagchu, Nyingchi (opposite Arunachal Pradesh) and Chamdo etc. The situation led to fall in tourism revenue. To contain the rising Covid 19 cases in TAR and curb anti-China feelings, the authorities suspend...