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That's what China is doing: they invest in infrastructure in many countries, and this solves significantly more problems and ties countries to China more deeply
by dmitriid 5y ago
That's what China is doing: they invest in infrastructure in many countries, and this solves significantly more problems and ties countries to China more deeply than the current vicious circle that Western countries employ: give out large grants and credits to largely corrupt governments, that money gets mostly stolen, give more money (and also more money to cover the interest rates from previous credits), repeat.
- yorwba 5y agoChina's development finance has had plenty of the same problems, which is why loan volume has drastically dropped since the 2016 peak [1], China adopted debt sustainability criteria similar to those used by World Bank and IMF [2] and the chairman of China Development Bank was relieved of his post and arrested for corruption [3]. [1] https://www.bu.edu/gdp/2020/12/13/scope-and-findings-chinas-overseas-development-finance-database/ https://www.bu.edu/gdp/2020/12/13/scope-and-findings-chinas-... [2] https://www.scmp.com/news/china/diplomacy/article/3007714/china-seeks-allay-belt-and-road-debt-trap-concerns-standard https://www.scmp.com/news/china/diplomacy/article/3007714/ch... [3] https://www.reuters.com/article/us-china-bank-idUSKBN2070PA https://www.reuters.com/article/us-china-bank-idUSKBN2070PA
- inglor_cz 5y agoChinese investments into infrastructure are hardly corruption-free. Look at the case of the new port in Sri Lanka, which was a fairly obvious debt trap from the beginning. https://en.wikipedia.org/wiki/Hambantota_International_Port https://en.wikipedia.org/wiki/Hambantota_International_Port Or at the highway in Montenegro, a small and poorish Balkan country that cannot really afford a $1 bn project going through the worst mountainous terrain in Europe. https://www.npr.org/2021/06/28/1010832606/road-deal-with-china-is-blamed-for-catapulting-montenegro-into-historic-debt https://www.npr.org/2021/06/28/1010832606/road-deal-with-chi... This kind of bad investments tend to be signed by corrupt politicians and sometimes backfire spectacularly.
- dnautics 5y agodid you not read the article? It is the best road in montenegro.
- inglor_cz 5y agoI can buy a Porsche and have the best car in my neighbourhood, but does it make sense if I go broke from the purchase? Same with Montenegro. The road does not make economic sense, either for Montenegro itself, or for a connection between Belgrade and Bar. The demand that would justify building and maintenance of such a behemoth in the wildest Balkan mountains just isn't there. If the region was flat, there would have been a (much cheaper) highway a long time ago, but it isn't. It is an engineering hell, much like most construction tasks in the mountains. Heck, even California dropped its plans for a bullet train from SF to LA because it was too expensive to cross the mountain ranges that stand in the way. And California is orders of magnitude richer than Montenegro. Mountains are best avoided when building roads. If you absolutely can't, the viability of the project needs a long, hard look.
- dnautics 5y agoShould have put more emphasis on the word "best"
- Bishizel 5y agoThey also do it via loans, so instead of paying aide every year, they just hold loans over their heads to get those countries to fall in line.