June 17, 2022
2 mins read

German Chancellor warns against China’s debt traps

Highly unsustainable levels of debt created by China in the developing world allow it to create economic dependencies and political leverages in these countries….reports Asian Lite News

Pointing at the serious danger posed by China’s lending spree in poorer countries, particularly Africa, German Chancellor Olaf Scholz warned that this could plunge the world into the next financial crisis.

“There is a really serious danger that the next major debt crisis in the global south will stem from loans that China has granted worldwide and doesn’t have a full overview of because there are so many players involved,” Scholz said.

“That would then plunge both China and the global south into a major economic and financial crisis and, incidentally, would not leave the rest of the world unaffected, to put it politely. So, this is a serious concern,” he added.

China’s infamous “debt-trap” policy is singularly responsible for the dire economic situation in many countries. Highly unsustainable levels of debt created by China in the developing world allow it to create economic dependencies and political leverages in these countries.

China has always maintained that its overseas lending follows a “no-strings-attached” approach and respects other countries’ right to select “their own development path” with a focus on developing countries’ control.

“One of the very, very big ambitions we have is to bring China in, as a country that is lending a lot in new ways,” he said, reported Hong Kong Post.

It is interesting to note that while criticizing China for its loan lending approach to the poor economies, Scholz pointed to the European Union’s recently unveiled Global Gateway initiative, which is in part aimed at countering China’s influence.

As per this initiative, the EU aims to invest over 150 billion euros in Africa. The investment is set for many key areas ranging from renewable energy to transport, vaccine production and education.

The ambitious scheme is widely seen as a response to China’s mammoth Belt and Road infrastructure project. Though there is worldwide condemnation of China’s debt-trap policy, Beijing disputes the charge. China argues saying that with the help of its loans the country is trying to alleviate poverty, as per the media portal. (ANI)

ALSO READ: Global outrage over China’s Xinjiang abuses

Previous Story

Pakistan pins hopes on US to revive IMF deal

Next Story

Afghan child labour on the rise in Iran

Latest from -Top News

Netaji’s Ashes Await Return Home

Today, 78 years after India gained independence in 1947, Bose remains physically separated from the country he fought to free. The Indian government has in the past considered repatriating his remains, but

Moscow turns into BRICS+ cultural capital

Moscow is set to stage twin cultural showcases, with BRICS+ filmmakers at the Library’s Film Night and young theatre actors joining an expanded InteRussia fellowship for creative exchange….reports Asian Lite News The

‘West’s anger means India’s right’

Russia has blasted US sanctions on India as “unlawful competition,” pledging uninterrupted crude supplies, market access, and unwavering support for New Delhi amid Western pressure and tariffs….reports Asian Lite News Russia has

Delhi & Washington keep defence bond strong

India and US officials push forward defence and trade ties despite Trump’s tariff hike, balancing strategic cooperation, energy security, and congressional outreach in a turbulent geopolitical landscape….reports Asian Lite News Indian and
Go toTop

Don't Miss

Biden, Xi to hold virtual meet next week

The President, in recent days, has rebuked China, saying President

Taiwan VP Frontrunner Says No War With China

The upcoming January 13 presidential and parliamentary elections are pivotal