This article was produced by Peoples Dispatch / Globetrotter News Service.
The Workers’ Party of Tunisia and several human rights groups have strongly objected to a deal proposed by European countries on the movement of migrants. They have called it a violation of sovereignty and the human rights of refugees.
On June 11, top European Union (EU) officials visited Tunisia and issued a joint statement after meeting President Kais Saied, saying that both parties have agreed to work jointly to end “irregular migration.”
Critics of the deal claim that the EU is using Tunisia’s precarious economic condition to force it to control the movement of migrants across the Mediterranean Sea in exchange for financial support, just like they did with Turkey and Libya.
The Workers’ Party claimed in a statement on June 15 that any such deal will make Tunisia a “policeman” patrolling its borders so that people trying to escape their deteriorating economic conditions can be stopped from going to Europe and punished.
Reports indicate that the EU is pushing Tunisia to establish a harsh border policy in exchange for its support for the country’s stalled bid to obtain a $1.9 billion loan from the International Monetary Fund.
Tunisia’s loan has been stalled for months due to Saied’s reluctance to implement the reforms demanded by the IMF. Saied is reportedly worried that his government—already facing large-scale popular resistance since his political coup in July 2021—will face another popular upsurge if the IMF’s demands to cut subsidies for essential commodities such as flour and fuel, cuts to social services, and privatization are implemented.
The leaders of Armenia, Nikol Pashinyan (right), and Azerbaijan, Ilham Aliyev (left), met with European Union President Charles Michel (center) in Brussels on May 22 / credit: president.az
While Russia continues conducting its “special military operation” in Ukraine, Moscow’s ally, Armenia, has been seeking to normalize relations with its arch enemy, Azerbaijan. Although the South Caucasus region has traditionally been in the Kremlin’s geopolitical orbit, it is the European Union that seems to be playing the major role in peace talks, border delimitation and the reopening of transportation links.
During the past six months, Armenian Prime Minister Nikol Pashinyan and Azerbaijan’s President Ilham Aliyev met three times through the mediation of European Council President Charles Michel.
In the past, Russia had mediated conflict between the two Caucasus countries over the Nagorno-Karabakh region. Although it is an internationally recognized part of Azerbaijan, it has been under Armenian control for more than two decades. In November 2020, Pashinyan and Aliyev traveled to Moscow to sign a ceasefire deal that effectively ended the 44-day war that Yerevan and Baku fought over the mountainous region.
As a result of the conflict, Azerbaijan restored its sovereignty over most parts of Nagorno-Karabakh, as well as surrounding areas. More importantly, Russia deployed about 2,000 peacekeeping troops, which strengthened its positions in the South Caucasus.
Map of Caucasus region, with Nagorno-Karabakh in yellow / credit: Wikipedia/CuriousGolden
‘Karabakh Has Turned Into South Ossetia’
Russian forces are stationed mostly in parts of Nagorno-Karabakh that are still under Armenian control.
According to Tom Mutch, a New Zealand-born journalist who covered the 44-day war, such a position allows Moscow to turn the region into its de facto military state.
“Let’s be honest, Karabakh has turned into South Ossetia now,” Mutch told Toward Freedom, referring to Georgia’s breakaway region that Russia recognized as an independent state in 2008, following the brief war Moscow fought against its small neighbor. “Russia holds all of the political and military power in the region. But the problem is that the Kremlin is so distracted by what is going on in Ukraine that it doesn’t really have any ability to focus on Karabakh.”
Despite its preoccupation with the war in Ukraine, Russia hosted Azerbaijani and Armenian delegations on June 3 in Moscow, where they held the 10th meeting of the trilateral working group on the opening of regional transport communications. According to reports, representatives of the three countries discussed and coordinated on borders, customs, and other kinds of control, as well as safe transit of people, cars, and goods by roads and railways through the territories of Azerbaijan and Armenia.
Following the Brussels meeting in May between Pashinyan and Aliyev, Baku and Yerevan announced the creation of commissions for border delimitation. In other words, they would look into increasing movement between the two states.
Dr. Gulshan Pashayeva, a board member of Azerbaijan’s Center of Analysis of International Relations, claims that is one of the tangible results of the peace talks held under the EU auspices. Still, she does not think the EU can replace Russia as the major mediator in the South Caucasus.
“EU and Russia are quite different geopolitical actors with incompatible resources and influence,” she told Toward Freedom. “Therefore, they cannot replace each other.”
Both Azerbaijan and Armenia are members of the EU’s political and economic Eastern Partnership initiative. Russia, on the other hand, sees both countries as its allies—Armenia, through the military alliance, the Collective Security Treaty Organization, and Azerbaijan, in the form of the allied cooperation agreement signed in February.
Under the mediation of Russian President Vladimir Putin on November 26 in the southern Russia city of Sochi, the leaders of rival countries Armenia and Azerbaijan agreed to ease remaining tensions after their 2019-20 war over the Nagorno-Karabakh region. Armenian President Nikol Pashinyan (right) and Azerbaijan’s President Ilham Aliyev (left) flank Putin / credit: commonspace.eu
No Agreement Without Moscow
According to Russian political analyst Sergey Markedonov, Russia and the West have always cooperated regarding the Karabakh issue. But the problem is Western powers no longer want to work with Moscow amid the Ukraine conflict.
Meanwhile, Mutch said Nagorno-Karabakh could be a place Russia and the EU can cooperate, despite their strained relations regarding Ukraine.
“But I don’t see any agreement that can be signed without Moscow’s final say,” he stressed.
In his view, the real reason why peace talks seem like they are making progress is the military defeat of Armenia in 2020.
“The speech that Pashinyan made in April was widely seen as signaling that he was prepared to give up Armenia’s aspirations for a de jure independent status of Karabakh,” Mutch said. “That was the sticking point of negotiations for the past 25 years.”
In that speech on April 13, the Armenian prime minister said, “The international community is telling Yerevan to lower the bar on the status of Nagorno-Karabakh.” He pointed out Armenia “cannot rely on international partners, not because they do not want to help the landlocked nation, but because they cannot help.”
Pashinyan also recently emphasized that the most important and most urgent issue between Armenia and Azerbaijan is the Nagorno-Karabakh issue. For Baku, however, the status of the mountainous region has already been resolved.
The most important and most urgent issue between Armenia and Azerbaijan and for the peace in our region is the Nagorno-Karabakh issue. pic.twitter.com/oT1eCluiOE
“I strongly believe that Armenia will come to understand that there will be no special status for ethnic Armenians living in the Karabakh region of Azerbaijan,” Samir Mammadov told Toward Freedom. He heads the international affairs department at “Back to Karabakh” Public Union – a political organization that aims to return ethnic Azeris to Nagorno-Karabakh.
“Armenian government officials often claim that they want the rights of Armenians living in Azerbaijan to be respected. Azerbaijan can and will ensure that without allowing the creation of an artificial autonomy within its borders,” Mammadov said, pointing out that if Yerevan continues insisting on the status of Karabakh, Baku will “probably raise the issue of the rights of Azerbaijanis ethnically cleansed from Armenia.”
In other words, Baku expects Yerevan to recognize Azerbaijan’s territorial integrity, while Armenia fears full implementation of the ceasefire deal the two sides signed in 2020 in Moscow would jeopardize the landlocked nation’s sovereignty. According to the Moscow agreement, “Armenia shall guarantee the security of transport connections between the western regions of the Republic of Azerbaijan and the Nakhchivan Autonomous Republic in order to arrange unobstructed movement of persons, vehicles and cargo in both directions.”
Since the end of 2020 Nagorno-Karabakh war Azerbaijan and Turkey have been promoting the concept of the “Zangezur corridor,” which, if implemented, would connect Azerbaijan to the Nakhchivan Autonomous Region and Turkey to the rest of the Turkic world through Armenia’s Syunik Province / credit: Mapeh / Wikipedia
The Fate of a Corridor
Russian Foreign Minister Sergey Lavrov recently assured Armenian officials the future railway and highway that will connect Azerbaijani mainland with its Nakhchivan exclave through southern Armenian will be “based on the recognition of the sovereignty of Armenian territory.”
For Azerbaijan, the future transportation route should be part of the Nakhichevan Corridor, also known as the Zangezur Corridor.
“The narrative of the wording of a so-called corridor is unacceptable for Yerevan,” Pashinyan said in a June 13 interview. “We have one corridor in our region, and this is the Lachin corridor connecting Nagorno-Karabakh with Armenia.”
That corridor is a mountain road that is de jure in the Lachin District of Azerbaijan, but is under the control of a Russian peacekeeping force as a result of the 2020 ceasefire deal.
Thus, the future of transportation links in the South Caucasus will almost certainly be on the agenda of future meetings between Pashinyan and Aliyev, be it in Brussels or in Moscow.
“The EU is ready to step up its support,” Michel said in a May 23 statement. “We agreed to remain in close contact and will meet again in the same format by July/August.”
Meanwhile, Lavrov is planning to meet today in Azerbaijan, which can be viewed as Russia’s attempt to keep both Armenia and Azerbaijan in its geopolitical orbit, despite the EU’s recent new role as a major mediator.
Nikola Mikovic is a Serbia-based contributor to CGTN, Global Comment, Byline Times, Informed Comment, and World Geostrategic Insights, among other publications. He is a geopolitical analyst for KJ Reports and Enquire.
On left: U.S. Secretary of State Antony Blinken with Rwandan President Paul Kagame. On right: Ugandan President Yoweri Museveni. Background: National Unity Platform presidential candidate Bobi Wine / photo illustration: Toward Freedom
SILVER SPRING, Maryland—The United States and its European allies only care about human-rights violations when it benefits them.
That’s what a few dozen members of the Horn of Africa and East Africa diaspora agreed upon as they gathered August 13 outside Washington, D.C.
A regional conference of the National Unity Platform, a political party in Uganda, brought together members of the country’s diaspora from the New York City and Washington metro areas to strategize on how to tackle U.S. meddling that props up leaders.
“The West wants to change regimes for itself, not for Africans—we remember Libya,” said Dr. Berhanu T. Taye, chair of the Global Ethiopian Advocacy Nexus (GLEAN) and member of the Ethiopian American Public Affairs Committee (AEPAC). He was referring to the 2011 U.S./NATO invasion that turned the most prosperous African country into a war zone that hosts slave markets.
‘Aid An Instrument of Western Neocolonialism’
While the conference’s theme was “Democracy & Security In East Africa & the Horn of Africa,” a series of protests the group staged the day prior was called, “No to Neo-Colonial African Dictators.”
Neocolonialism refers to the stage of colonialism in which a colonial power continues to control a country or a nation of people by supporting the rise to leadership of those within the oppressed nation who serve the colonial master. This continues the process of extracting material wealth for the benefit of the colonial powers. Loan programs through the International Monetary Fund and the World Bank are seen as tools to subjugate and profit off oppressed countries.
Taye referred to Western aid as “opium.” He encouraged conference attendees to get better organized for the struggle. “Aid is not only an instrument of Western neocolonialism, but of underdevelopment.”
The party’s regional conference included attendees and speakers from countries outside East Africa and the Horn of Africa, including Chad, Nigeria, Senegal, Sierra Leone and Guinea Bissau.
The Horn of Africa highlighted in yellow / credit: Wikimedia
Some party members and attendees from other countries expressed frustration with non-governmental organizations and the U.S. government not taking their concerns seriously.
“The likes of [Ugandan President Yoweri] Museveni and [Rwandan President Paul] Kagame… would not be able to do what they do without the backing of the United States and the United Kingdom,” said Maurice Carney, who spoke remotely to the audience via Zoom. Carney is founder and executive director of U.S.-based nonprofit organization Friends of the Congo.
Among the violations the group denounced were Museveni’s government being partly responsible for destabilizing the Democratic Republic of Congo (DRC) by sending arms and proxy fighters.
Meeting notes from an August 8 convening of the United Nations Security Council show officials pointing out the Ugandan government’s support for a Daesh affiliate group.
The violence in the DRC has internally displaced 5.6 million Congolese, while 990,000 take shelter across the African continent. In February, the International Court of Justice ordered Uganda to pay $325 million in reparations to the DRC.
‘Billions Go Out the Back Door’
The U.S. Chamber of Commerce’s International Trade Administration encourages U.S. companies to do business in the DRC, citing “tens of trillions of dollars” in mineral wealth.
“The DRC is one of the most blessed places on Earth,” said Taye. “Sadly, the agents in the neighborhood—Kagame and Museveni—are facilitating the looting of Congo for the West.”
Non-governmental organization Global Witness reported in April that 90 percent of minerals coming out of one DRC mining area were shown to have come from mines that did not meet security and human-rights standards. Companies relying on minerals from such mines include U.S.-based Apple, Intel and Tesla.
“Aid that comes in the front door with tens of millions of dollars is a mirage,” Carney said. The United States has disbursed $618 billion in aid to Uganda since 2001. “Billions go out the back door in the form of extractions [of resources].”
‘Africa Is Going to Be Punished’
Conference moderator Joseph Senyonjo said the NUPUSA (the party’s U.S. arm) has attempted to engage U.S. Representative Karen Bass (D-CA), chair of the Subcommittee on Africa, Global Health, Global Human Rights and International Organizations in the House Committee on Foreign Affairs.
“She has done nothing,” he said.
Senyonjo added Rep. Gregory Meeks (D-NY) has been unhelpful. Meeks chairs the House Committee on Foreign Affairs and has introduced a U.S. House bill that would punish African countries for bypassing U.S. sanctions on Russia. U.S. Ambassador to the UN Linda Thomas-Greenfield said in an August 5 speech in Ghana that U.S. sanctions are not to blame for the global wheat shortage, all while threatening action if African countries buy Russian fossil fuels. However, cutting off Russia from the SWIFT global payments system prevents it from trading wheat, a major Russian export.
What does that mean for African countries that have relied on Russia for 32 percent of their wheat imports?
“Africa is going to be punished,” Senyonjo told conference attendees.
“Internationalism is the Achilles’ heel of U.S. imperialism,” said Netfa Freeman, keynote speaker at the August 13 regional conference of the National Unity Platform (Uganda) held outside Washington, D.C. / credit: Julie Varughese
‘We Can’t Be Timid’
Netfa Freeman, the keynote speaker, warned attendees of approaching the U.S. government from a weak position and with the intent of appealing to the conscience. He said the United States cannot recognize human rights because it was built by violating the human rights of the Indigenous peoples and enslaved Africans. Now, it holds one-fifth of the world’s prisoners, including the longest-held political prisoners in the world.
“Convincing them cannot be the goal,” said Freeman, an organizer with Pan-African Community Action, a grassroots organization based in southeast Washington. He also is a member of the Black Alliance for Peace Coordinating Committee and hosts a local radio program.
Freeman added officials such as Thomas-Greenfield, U.S. Vice President Kamala Harris and U.S. Secretary of Defense Austin Lloyd mirror the comprador class that holds power in various African countries. A comprador appears to independently operate as a leader, but answers to colonial powers.
Freeman encouraged conference attendees to widen the scope of their solidarity to include Afro-descendants in Cuba, Haiti, Nicaragua and Venezuela, for example, because they, too, suffer under U.S. sanctions and threats of invasion. He connected events that took place during the same timeframe on the continent—the assassination of DRC Prime Minister Patrice Lumumba and the driving into exile of Ghanian Prime Minister and President Kwame Nkrumah—with the assassinations of Malcolm X and the Rev. Dr. Martin Luther King, Jr.
“Internationalism is the Achilles’ heel of U.S. imperialism,” Freeman said.
Freeman added the struggle must be waged against the system, not against individual leaders.
“We can’t be timid. We don’t ask for anything. We demand.”
Anti-government protest in Sri Lanka on April 13 in front of the Presidential Secretariat / credit: AntanO / Wikipedia
Editor’s Note: This article was originally published by Multipolarista.
Facing a deep economic crisis and bankruptcy, Sri Lanka was rocked by large protests this July, which led to the resignation of the government.
Numerous Western political leaders and media outlets blamed this uprising on a supposed Chinese “debt trap,” echoing a deceptive narrative that has been thoroughly debunked by mainstream academics.
In reality, the vast majority of the South Asian nation’s foreign debt is owed to the West.
These structural adjustment programs clearly have not worked, given Sri Lanka’s economy has been managed by the IMF for many of the decades since it achieved independence from British colonialism in 1948.
As of 2021, a staggering 81 percent of Sri Lanka’s foreign debt was owned by U.S. and European financial institutions, as well as Western allies Japan and India.
This pales in comparison to the mere 10 percent owed to Beijing.
According to official statistics from Sri Lanka’s Department of External Resources, as of the end of April 2021, the plurality of its foreign debt is owned by Western vulture funds and banks, which have nearly half, at 47 percent.
The top holders of the Sri Lankan government’s debt, in the form of international sovereign bonds (ISBs), are the following firms:
BlackRock (U.S.)
Ashmore Group (Britain)
Allianz (Germany)
UBS (Switzerland)
HSBC (Britain)
JPMorgan Chase (U.S.)
Prudential (U.S.)
The Asian Development Bank and World Bank, which are thoroughly dominated by the United States, own 13 percent and 9 percent of Sri Lanka’s foreign debt, respectively.
Less known is that the Asian Development Bank (ADB) is, too, largely a vehicle of U.S. soft power. Neoconservative DC-based think tank the Center for Strategic and International Studies (CSIS), which is funded by Western governments, affectionately described the ADB as a “strategic asset for the United States,” and a crucial challenger to the much newer, Chinese-led Asian Infrastructure Investment Bank.
“The United States, through its membership in the ADB and with its Indo-Pacific Strategy, seeks to compete with China as a security and economic partner of choice in the region,” boasted CSIS.
Another country that has significant influence over the ADB is Japan, which similarly owns 10 percent of Sri Lanka’s foreign debt.
An additional 2 percent of Sri Lanka’s foreign debt was owed to India as of April 2021, although that number has steadily increased since. In early 2022, India was in fact the top lender to Sri Lanka, with New Delhi disbursing 550 percent more credit than Beijing between January and April.
Together, these Western firms and their allies Japan and India own 81 percent of Sri Lanka’s foreign debt – more than three-quarters of its international obligations.
By contrast, China owns just one-tenth of Sri Lanka’s foreign debt.
The overwhelming Western role in indebting Sri Lanka is made evident by a graph published by the country’s Department of External Resources, showing the foreign commitments by currency:
As of the end of 2019, less than 5 percent of Sri Lanka’s foreign debt was denominated in China’s currency the yuan (CNY). On the other hand, nearly two-thirds, 64.6 percent, was owed in U.S. dollars, along with an additional 14.4 percent in IMF special drawing rights (SDR) and more than 10 percent in the Japanese yen (JPY).
Western media reporting on the economic crisis in Sri Lanka, however, ignores these facts, giving the strong, and deeply misleading, impression that the chaos is in large part because of Beijing.
Sri Lankan Economic Crisis Driven by Neoliberal Policies, Inflation, Corruption, Covid-19 Pandemic
This July, Sri Lanka’s government was forced to resign, after hundreds of thousands of protesters stormed public buildings, setting some on fire, while also occupying the homes of the country’s leaders.
The protests were driven by skyrocketing rates of inflation, as well as rampant corruption and widespread shortages of fuel, food, and medicine – a product of the country’s inability to pay for imports.
In May, Sri Lanka defaulted on its debt. In June, it tried to negotiate another structural adjustment program with the U.S.-dominated International Monetary Fund (IMF). This would have been Sri Lanka’s 17th IMF bailout, but the talks ended without a deal.
By July, Sri Lankan Prime Minister Ranil Wickremesinghe publicly admitted that his government was “bankrupt.”
Sri Lankan President Gotabaya Rajapaksa, who spent a significant part of his life working in the United States, entered office in 2019 and immediately imposed a series of neoliberal economic policies, which included cutting taxes on corporations.
These neoliberal policies decreased government revenue. And the precarious economic situation was only exacerbated by the impact of the Covid-19 pandemic.
Facing an out-of-control 39.1 percent inflation rate in May, the Sri Lankan government did a 180 and suddenly raised taxes again, further contributing to popular discontent, which broke out in a social explosion in July.
Media Falsely Blames China for Sri Lankan Debt Default
While 81 percent of Sri Lanka’s foreign debt is owned by Western financial institutions, Japan, and India, major corporate media outlets sought to blame China for the country’s bankruptcy and subsequent protests.
The Wall Street Journal pointed the finger at Beijing in a deeply misleading article titled “China’s Lending Comes Under Fire as Sri Lankan Debt Crisis Deepens.” The newspaper noted that the crisis “opens a window for India to push back against Chinese influence in the Indian Ocean region.”
U.S. media giant the Associated Press also tried to scapegoat China, and its deceptive news wire was republished by outlets across the world, from ABC News to Saudi Arabia’s Al Arabiya.
VOA accused Beijing of “pursuing a kind of ‘debt-trap diplomacy’ meant to bring economically weak countries to their knees, dependent on China for support.”
On social media, the Western propaganda narrative surrounding the July protests in Sri Lanka was even more detached from reality.
A veteran of the Central Intelligence Agency (CIA), Defense Intelligence Agency (DIA), and National Security Agency (NSA), Derek J. Grossman, portrayed the unrest as an anti-China uprising.
“China’s window of opportunity to one day control Sri Lanka probably just closed,” he tweeted on July 9, as the government announced it was resigning.
After working for U.S. spy agencies, Grossman is today an analyst at the Pentagon’s main think tank, the RAND Corporation, where he has pushed a hawkish line against Beijing.
China’s window of opportunity to one day control Sri Lanka probably just closed. pic.twitter.com/WOLIb3SUTf
— Derek J. Grossman (@DerekJGrossman) July 9, 2022
BBC Reluctantly Admits the ‘Chinese Debt Trap’ Narrative in Sri Lanka Is False
China has funded several large infrastructure projects in Sri Lanka, building an international airport, hospitals, a convention center, a sports stadium, and most controversially a port in the southern coastal town of Hambantota.
The UK government’s BBC sent a reporter to Sri Lanka to investigate these accusations of supposed “Chinese debt traps.” But after speaking to locals, he reluctantly came to the conclusion that the narrative is false.
“The truth is that many independent experts say that we should be wary of the Chinese debt trap narrative, and we’ve found quite a lot of evidence here in Sri Lanka which contradicts it,” BBC host Ben Chu acknowledged.
He explained, “The Hambantota port, well, that was instigated by the Sri Lankans, not by the Chinese. And it can’t currently be used by Chinese military naval vessels, and actually there’s some pretty formidable barriers to that happening.”
“A lot of the projects we’ve been seeing, well, they feel more like white elephants than they do Chinese global strategic assets,” Chu added.
In our latest film from Sri Lanka, which faces financial collapse as the global Big Squeeze bites, Ben Chu examines the effect that Chinese loans and investment are having on the country:#Newsnighthttps://t.co/GBFZ1ItP0G
The British state media outlet interviewed the director of Port City Colombo’s economic commission, Saliya Wickramasuriya, who emphasized, “The Chinese government is not involved in setting the rules and regulations, so from that standpoint the government of Sri Lanka is in control, and it’s up to the government of Sri Lanka’s wish to flavor the city, the development of the city, in the way it wants to.”
“It is accurate to say that infrastructure development has boomed under Chinese investment, Chinese debt sometimes, but those are things that we’ve actually needed for a long, long time,” Wickramasuriya added.
Chu clarified that, “Importantly, it’s not debt but equity the Chinese own here.”
“So is the debt trap not all it seems?” he asked.
Mainstream U.S. Academics Debunk the ‘Chinese Debt Trap’ Myth
Mainstream Western academics have similarly investigated the claims of “Chinese debt traps,” and come to the conclusion that they do not exist.
Even a professor at Johns Hopkins University’s School of Advanced International Studies, which is notorious for its revolving door with the U.S. government and close links to spy agencies, acknowledged that “the Chinese ‘debt trap’ is a myth.”
Writing in 2021 in the de facto mouthpiece of the DC political establishment, The Atlantic magazine, scholar Deborah Brautigam stated clearly that the debt-trap narrative is “a lie, and a powerful one.”
“Our research shows that Chinese banks are willing to restructure the terms of existing loans and have never actually seized an asset from any country, much less the port of Hambantota,” Brautigam said in the article, which was co-authored by Meg Rithmire, a professor at the stridently anti-socialist Harvard Business School.
The Chinese "debt-trap" narrative is a false one which wrongfully portrays both Beijing and the developing countries it deals with, Deborah Brautigam and Meg Rithmire write: https://t.co/FagExsdeNT
Brautigam published her findings in a 2020 article for Johns Hopkins’ China Africa Research Initiative, titled “Debt Relief with Chinese Characteristics,” along with fellow researchers Kevin Acker and Yufan Huang.
They investigated Chinese loans in Sri Lanka, Iraq, Zimbabwe, Ethiopia, Angola, and the Republic of Congo, and “found no ‘asset seizures’ and, despite contract clauses requiring arbitration, no evidence of the use of courts to enforce payments, or application of penalty interest rates.”
They discovered that Beijing cancelled more than $3.4 billion and restructured or refinanced roughly $15 billion of debt in Africa between 2000 and 2019. At least 26 individual loans to African nations were renegotiated.
Western critics have attacked Beijing, claiming there is a lack of transparency surrounding its loans. Brautigam explained that “Chinese lenders prefer to address restructuring quietly, on a bilateral basis, tailoring programs to each situation.”
The researchers noted that China puts an “emphasis on ‘development sustainability’ (looking at the future contribution of the project) rather than ‘debt sustainability’ (looking at the current state of the economy) as the basis of project lending decisions.”
“Moreover, despite critics’ worries that China could seize its borrower’s assets, we do not see China attempting to take advantage of countries in debt distress,” they added.
“There were no ‘asset seizures’ in the 16 restructuring cases that we found,” the scholars continued. “We have not yet seen cases in Africa where Chinese banks or companies have sued sovereign governments or exercised the option for international arbitration standard in Chinese loan contracts.”
Benjamin Norton is founder and editor of Multipolarista.
