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After Doling Out Loans, China Is Now Bailing Out Countries
- Overtonwindow 4y agohttps://archive.is/WL692 https://archive.is/WL692
- RcouF1uZ4gsC 4y agoAs the saying goes: If you owe someone $100 l, that is your problem. If you owe someone $100 Billion, that is their problem. My guess is that the Chinese economy cannot afford to have those loans go bad so they need to do a bailout. This is a move of desperation, not a move of dominance.
- toomuchtodo 4y agoChina bet Africa was the future, and while China might be early, early is the same as wrong if you can’t stay solvent until your investment is liquid (China economy slowing, manufacturing moving elsewhere, rapidly aging population, etc).
- seanmcdirmid 4y agoThe Chinese banks that made the loans can’t take the losses on their balances sheets, even if they are state owned their shares are traded on the market (and SOE debt is technically not counted as national debt), so a bail out has to occur at least on paper.
- fspeech 4y agoDoubt that public traded banks made these kind of loans. Policy banks are not public traded.
- qikInNdOutReply 4y ago? That share market in china is a inhouse market, and completely state-controlled. There is no "free" market as in its public and free of influence. It already collapsed once and was propped up.
- fspeech 4y agonot the point. just like svb, ownership is only relevant to how management is incentivized by how compensation (monetary and otherwise) is structured.
- hakfoo 4y agoWe tend to think of "soft power" as "They watch our TV and eat our fast-food franchises, so they'll implicity love us." Did we underestimate the soft power of actual wads of limited-strings-attached cash? This is a pretty obvious and direct way to buy friends, and it seems odd the West can't figure out how to execute it just as efficiently. Maybe it's not considered an option because it provides neither a punitive angle nor a lever to demand privatization and austerity measures. Maybe the state can't lean hard enough on the bankers to get them to cooperate with the plan.
- Panzer04 4y agoIt costs money? Most democratic countries have issues giving away too much money in foreign aid, especially given the budgetary deficits the vast majority of countries are running nowadays. China doesn’t have to deal with any of that, the government can spend money with very little oversight.
- hakfoo 4y agoIf we didn't have such siloed mindsets, you'd expect that foreign aid would come right out of the limitless "national security" spigot. How many incredibly expensive "peacekeeping" and "regime change" adventures could have been prevented by removing debt burdens that were preventing countries from stabilizing and advancing up the economic food chain 5-10-20 years prior?
- deleted 4y ago[deleted]
- defrost 4y agoPretty much all of them. The US doesn't have a great record on use of diplomatic soft power, it appears from afar that military hardware lobbyists achieve their goal of getting at least a factor of 10x more spent on war toys than on diplomatic programs that would circumvent the need to use said toys. ( I suspect the overspend factor on hardware Vs HR approaches is way more than 10 )
- 4y ago
- NicoJuicy 4y agoChina already earned these loans back, because most of it was used for ... Chinese workers and not local ones. ( Exporting excess Chinese building capacity, because the internal market struggled). Most of these infrastructure projects weren't needed in the first place and just didn't generate any revenue for those countries.
- seanmcdirmid 4y agoThose workers still needed to be paid and supplies needed to be procured. They could have used those resources else where, except construction in China is a huge jobs program for the lower middle class and isn’t really run very efficiently to begin with. Those countries actually do need infrastructure, but not necessarily prestige projects like a new fancy airport that no one wants to use.
- alphabetatheta 4y agoChina picks which loans to give based on geopolitical importance. This is a fantastic way to wield soft power of the US, India, and other Eurasian countries. Moreover, it also reduces reliance on the dollar.
- data_maan 4y agoWhile increasing reliance on authoritarian countries?
- defrost 4y agoThis is the basis of "debt trap diplomacy" and was predicted a good ten years (more?) ago when China started with the "global silk belt road" program. China is gaining 100 year (at least) leases on ports and ground stations around the planet, supplanting the UK as an empire on which the sun never sets.
- slowmovintarget 4y agoThis is the McKinsey strategy in action. That consulting company laid out how to do it, then seeded all their other consultation gigs with "you've got to outsource to China."
- Garvi 4y ago[flagged]
- random314 4y agoHacker news promotes neolib views with the occasional neocon agenda. These are programmers with strong and uninformed media massaged opinions. Chomsky is unfortunately relevant even today.
- jack1243star 4y agoInstead of meta-complaining, why don't you provide your own opinion on China?
- Garvi 4y agoBecause I have better things to do than writing pages on political debate, rich with links and sources, only to have them shadow-hidden and not seen by anyone. Happens regularly on this forum... I would go on, but discussions on moderation are punished the same way.
- mindslight 4y agoSome of us read comments with showdead: yes, and vouch for comments that seem insightful. But there are no such comments on this thread. And for the most part dead comments are dead for a reason. And for reference, simply being against the prevailing narrative without making any substantive point does not make for a worthwhile comment.
- random314 4y agoGo through his comment history. Oliver Stones documentary on Ukraine has been heavily suppressed and blocked by tech companies, 1st amendment not withstanding.
- pjc50 4y ago"China bad" is downvoted not because it's "wrongthink" but because it simply doesn't add anything to the conversation any more than "USA bad" does.