Sri Lanka has recently witnessed an unprecedented economic crisis. Sri Lanka took a huge loan from China. Currently, along with Sri Lanka, Pakistan and Maldives are China’s biggest debtors. According to Forbes, Pakistan’s external debt to China is $77.3 billion.
The Island Online reports that the Maldives has a debt of 31 percent of its gross national income. By the end of 2020, the total debt of the Maldives is 86 billion Maldivian rupiah. Out of this, the amount of foreign debt is 44 billion rupees.
Pakistan has the largest external debt to China, amounting to USD 77.3 billion. On the other hand, Angola 36.3 billion, Ethiopia 7.9 billion US dollars, Kenya 7.4 billion US dollars and Sri Lanka 6.8 billion US dollars.
Collecting data from the 2020 World Bank report, Forbes said that 97 countries around the world are under Chinese debt. Most of the countries borrowing from China are located in Africa. However, Chinese debt also extends to Central Asia, Southeast Asia and the Pacific.
China is reaching most of the countries under the One Belt and Road project. The world’s low-income countries took 37 percent of their total debt from China in 2022. The amount of which is only 24 percent compared to the rest of the world.
According to a report by The Island Online, China has chosen the construction of port, rail and land infrastructure in various countries for global financing.
Pakistan has the largest external debt to China, amounting to USD 77.3 billion. On the other hand, Angola 36.3 billion, Ethiopia 7.9 billion US dollars, Kenya 7.4 billion US dollars and Sri Lanka 6.8 billion US dollars.
Maldivian media reported that by the end of the first quarter of 2022, the Maldivian debt had increased to MVR 99 billion, which is 113 percent of the country’s GDP, according to figures released by the Ministry of Finance.
Djibouti and Angola are burdened with the highest debt burden in relative terms. China’s debt to the two countries exceeds 40 percent of gross national income.
China has faced criticism for its approach to lending to poor countries. Allegedly, countries that borrow from China often suffer. Pressure from Beijing makes it even more risky.
However, China rejected this criticism. On the contrary, it has been termed as ‘propaganda/narrative of vested interest countries’ to tarnish their image.
(September 13)