Lapidary column of The WASHINGTON Post against CHINA

A recent column in The Washington Post newspaper was highly critical of the causes of the current health, economic, social and humanitarian crisis that is being suffered globally by the coronavirus pandemic, where it is recharging everything against China.

Under the title “This crisis has taught us the true cost of doing business with China”, the note signed by Charles Lane, is forceful in giving his diagnosis of what happened: “Through the coronavirus crisis, everyone is learning , the hard way, the real cost of doing business with China. “

“Reflectively reserved, the country’s communist rulers withheld or downplayed critical information about the virus until it was too late to prevent the pathogen from spreading from Wuhan through the transportation systems and industrial supply chains that link the People’s Republic to any other place“he warned.

“Public health is not the only area in which China’s insistence on playing by its own non-transparent rules can threaten international stability. Global finances, especially those of the world’s poorest countries, also face what might be called risk of Chinese secrecy, “he argues.

According to The Washington Post, Beijing used its money to co-opt wills in the least developed nations for a total of “hundreds of billions of dollars in loans that China has provided in the past two decades, possibly more than the World Bank and other multilateral banks of development combined, with little or no exposure to the kind of public scrutiny that Western governments, multilateral institutions and private banks generally accept when making loans. “

He also referred to the near future that the debtor countries will have to face: “CWith their commodity exports plummeting amid the global economic crisis, debtors to China in Africa and Asia will soon face a horrible choice: impoverish their people to pay off debt service to China or default and lose key national assets, which they issued as collateral for Beijing. ”

“The origins of China’s wave of overseas lending lie in its need to find profitable uses for its vast reserves of dollar export earnings, while seeking to gain political influence in strategic and resource-rich regions of the world,” points out.

“In a sense, China’s behavior resembles previous US-led Western development finance efforts, with one crucial exception. Overall, the West maintained a distinction between ‘soft’ official loans made under concessional terms, and loans from private banks, which included market interest rates and guarantees. However, China uses state banks to lend to governments, or often government corporations, at market rates. So far, confident that they could pay China through future growth, African and Asian nations accepted the deal. Corrupt officials may have considered China’s secret ways, including confidentiality clauses in loan agreements, such as an added attraction. Fraud and waste plague many China-backed projects. “

“Chinese state bank loans are beyond the reach of two key international monitors: the Paris Club for government-to-government loans and the Institute of International Finance for private bank-to-government financing … Harvard economist Carmen Reinhart and Two colleagues, Sebastian Horn and Christoph Trebesch, from Germany’s Kiel Institute for the World Economy spent two years cleaning up previously untapped data sources and found that China had lent $ 400 billion to 106 developing and emerging market countries through 2017 , half of which does not appear in the data on the debt burden of multilateral organizations and credit rating agencies, “he adds.

“CWith so much darkness surrounding what nations really owe China, there is a real risk to creditors of the United States and the West, public and private, that the cash debt relief they provide to poor countries will end. channeled to Beijing banks. And a broader restructuring would still require major changes in Beijing’s policies. There can be no coordinated and effective international response to the financial crisis facing the entire world, especially its poorer nations unless and until China agrees to fully clarify its foreign loans. By failing to meet its global public health responsibilities, Beijing should not be allowed to escape with nondisclosure and self-centeredness in global finance, “he concluded.

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