A WIN Discussion, January 2024. China’s Belt and Road Initiative (BRI) has probably channelled the biggest export of capital in the post WWII period. Although it started with great promise, a 10 year review now finds that developing countries are in as much debt to China as they have been to the IMF.
BRI has been characterized by loans rather than grants. China’s state-owned commercial banks have assumed an increasingly important role during the BRI era by organizing lending syndicates. Debts, accumulated from a number of “mega-projects”—financed with loans worth $500 million or more—tripled each year during the first five years of BRI. A review has found some 35% of the BRI infrastructure investments are characterized with corruption scandals, labour violations, environmental hazards, and public protests against displacement of indigenous people. The high-risk, high-reward credit allocation strategy is now reviewed as mounting debts cannot be repaid during a time of international crisis bearing most heavily on developing countries. The working conditions of Chinese firms are degraded in the extreme in the effort to achieve higher profitability and to repay loans.
Is all such aid fundamentally destructive of the prospects for economic development?
How should the international workers’ movement view such investment: how do we differentiate our views from those of western imperialism? How do we help workers in developing countries organize against the cheap labour regime of monopolies and win support from trade unions North and South?
Patrick Bond, professor at the University of Johannesburg, an expert on Chinese investment and a strident critic of imperialist domination of the former colonial world, reviewed the promise of the Belt and Road Initiative against its reality.
Image by Paul Carmona, NSW Ports Authority – CC BY-NC-ND 2.5 AU DEED
FOR FURTHER INFORMATION SEE –
Watch the late John Pilger’s film: https://johnpilger.com/videos/the-coming-war-on-china