• About   |
  • Write For Us   |
  • Contact Us   |
  • हिंदी
Sunday, February 5, 2023
  • Login
  • Register
No Result
View All Result
The Second Angle
Advertise
  • Infotainment
    • Sports
  • Entertainment
    • Lifestyle
      • Home & Decoration
  • People
    • Inspiring
  • Education
  • Travel
  • Finance
  • Healthcare
  • Technology
  • World
The Second Angle
  • Infotainment
  • Entertainment
  • People
  • Education
  • Travel
  • Finance
  • Healthcare
  • Technology
  • World
Advertisement
ADVERTISEMENT
Home Economy

China’s Game of Loans: You either comply or you cry

Will China become the new superpower?

Khushi Maheshwari by Khushi Maheshwari
August 24, 2021
in Economy
Reading Time: 4 mins read
A A
China’s Game of Loans: You either comply or you cry
Share on FacebookShare on WhatsApp
Advertisement Advertisement Advertisement
ADVERTISEMENT

The New Silk Road 

The original Silk Road was born during the development of the Han dynasty (206 BCE–220 CE) and it acted as a common network of trade for several central Asian countries such as Afghanistan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan along with India and modern-day Pakistan.

This endeavor to expand China’s reach towards the west was also the first-ever wave of globalization in Asia with all kinds of Chinese native and non-native commodities being traded among countries.

RelatedPosts

Small Business Loan

What are the Different Types of Small Business Loans?

Everything You Need to Know about Banglarbhumi West Bengal

Everything You Need to Know about Banglarbhumi West Bengal

Ever since Mongolian invasions, Eurasian, Central Asian, and South Asian countries have by far been exclusive of each other with trade among them accounting for a mere 6.2% out of the total trade in the world; until 2013 when President Xi Jin Ping announced his intentions to rejuvenate the Asian Spirit by once again expanding trade relations to the nooks and corners of Asia.

He instigated his plans by launching the ‘One Belt, One Road initiative, also known as the Belt and Road initiative or the New Silk Road. 

The initiative has 5 primary goals:

  1. Connecting people across Eurasia
  2. Policy Coordination
  3. Infrastructure Connectivity
  4. Uninterrupted Trade
  5. Financial amalgamation 

These goals will be achieved by integrating lands via a transcontinental passage that will connect China to other countries over land and a maritime silk route that will connect various ports via the vast Asian waters. 

By March 2020, the number of countries that signed a Memorandum of Understanding or MoU and collaborated with China on this initiative had been 138, yet a lot of first-world countries such as the United States of America have expressed their reservations in regards to this scheme.

They say that even though China promises equal benefits for all its partners, some countries suspect a dangerous spike in China’s power and a possible usurpation of America’s Hegemony status since it has as of now failed to provide a significantly powerful counter-strategy to China. 

China plans on making grand infrastructural investments in other countries, opening for itself big doors of opportunity to control parts of every country it invests in.

Many nations fear that China is going to entrap them in a game of loans and there is nothing economically worse for a country than to give its mega assets on the lease after being caught in a debt trap, as has quite pertinently been observed in the case of Sri Lanka and her precious Hambantota Port. 

 How China took over Sri Lanka’s Hambantota Port

Feasibility studies by a Danish Consulting firm in 2003 suggested that the port will not work in the long run yet Sri Lanka’s then-president Mahinda Rajapaksa was adamant about making it work, he turned to other countries for loans and was denied it by almost every country including India. 

At last, Rajapaksa approached China for a loan, and then another; and then another, and China kept lending with open arms. Mind you, this was not sheer benevolence and goodwill on China’s part; it was the inevitable failure of the Hambantota port that everyone except the president had already accepted in their heads.

Out of the millions of ships passing by one of the busiest shipping lanes in the Indian Ocean, the Port could only attract 34 in the whole duration of 2012 and 175 in the year 2017. 

China’s Game of Loans: You either comply or you cry
image source: cgtn

Unable to repay its loans to China, the island country found itself drowning in debt and therefore had to give China a controlling equity stake and a 99-year lease for Hambantota Port, which China took over in 2017. 

Even though China has a lot of unsolicited projects in Sri Lanka, the Hambantota Port is not one of them; which is why this usurpation was more of a manipulation of the Sri Lankan government than the use of coerciveness, and it is primarily the former president’s fault.

The development project of the Hambantota Port was part of the plan for the country 19 years ago as well. The Sri Lankan government claims that Chinese control of the port is purely financial and nothing more, yet the decision has faced much criticism and opposition from within the country, many prominent voices claiming that Sri Lanka’s sovereignty has taken a big hit after this decision. 

China’s Game of Loans: You either comply or you cry
image source: theguardian

Notably, many of Sri Lanka’s grand development projects during the tenure of President Rajapaksa, such as an international airport, a cricket stadium, and the port, were all backed by Chinese Financing.

For China, the control of Hambantota Port was a big win in its Belt and Road initiative. More interestingly, the finances Sri Lanka obtained after giving a 99-year lease of the port to china were not used to repay china’s loan, but to repay multiple outstanding loans it took from other countries as well; which loosely translates to still having to pay china back after all the ruckus.

On top of everything else, China has affirmed yet another loan of 989 million USD to Sri Lanka for the construction of an expressway that will join its central tea growing regions to the Chinese run sea-port.

It will be appropriate to conclude that at this rate China might just take over America’s prowess and in turn, make the speculation and apprehensions take life.

 

Also Read:  FDI inflows rise in May 2021 as economy recovers, says Piyush Goyal

ShareSendTweet
Khushi Maheshwari

Khushi Maheshwari

Related Posts

Small Business Loan
Economy

What are the Different Types of Small Business Loans?

choosing the right type of small Business Loan that is affordable and fulfils the funding requirement adequately is imperative. Here...

Read more
Everything You Need to Know about Banglarbhumi West Bengal
Economy

Everything You Need to Know about Banglarbhumi West Bengal

With the launch of Banglarbhumi, an online portal of West Bengal's land and property records department, citizens can now easily...

Read more
8 Reasons to Use a Housing Loan EMI Calculator
Economy

8 Reasons to Use a Housing Loan EMI Calculator

Home loan EMI calculators are readily available online; all a borrower has to do is go to the webpage of...

Read more
Some governments believe that it should be banned altogether, while others think that it should be regulated in the same way as traditional currency. So far, no country has come up with a perfect solution, and the future of cryptocurrency is still uncertain.
Business

Governments Struggle to Balance Cryptocurrency Regulation: How Will It Impact the Future of Digital Currency?

Some governments believe that it should be banned altogether, while others think that it should be regulated in the same...

Read more
Want To Learn How to Read Your Credit Card Statement?
Business

Want To Learn How to Read Your Credit Card Statement?

A credit card statement can be defined as a document that provides a comprehensive summary of how the credit card...

Read more
QR Code: Convenient and safe mode of digital payments
Economy

QR Code: Convenient and safe mode of digital payments

In the retail world, QR codes may be utilized in various techniques. QR Codes may help merchants engage with e-commerce...

Read more
Load More
Next Post
FSD or ‘FULL SELF DRIVING’ offered by Tesla, is it reliable?

FSD or ‘FULL SELF DRIVING’ offered by Tesla, is it reliable?

Comments 1

  1. Pingback: Centre Hikes Fair Price Of Sugarcane, Farmers Demand Increase In MSP – The Second Angle

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Facebook Twitter Instagram Telegram

About

The Second Angle

A platform providing diverse views on various issues, providing an in-depth understanding of important developments happening around us. It offers you true journalism amidst the cacophony. Discover the latest news, opinions, analysis and a lot more here.

Important Links

  • About
  • Career
  • Write for us | The Second Angle
  • Support Us
  • Privacy Policy
  • Terms
  • Contact Us
  • Newsletter
  • हिंदी

Subscribe to Our Newsletter

We don’t spam! Read our privacy policy for more info.

Check your inbox or spam folder to confirm your subscription.

© 2017-22. The Second Angle. All Rights Reserved. Developed and Maintenance by SquareBase.io

No Result
View All Result
  • Infotainment
    • Sports
  • Entertainment
    • Lifestyle
      • Home & Decoration
  • People
    • Inspiring
  • Education
  • Travel
  • Finance
  • Healthcare
  • Technology
  • World
  • Login
  • Sign Up

© 2017-22. The Second Angle. All Rights Reserved. Developed and Maintenance by SquareBase.io

Welcome Back!

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Fill the forms below to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.