Country, estimated to be owed up to $1.5trn, is increasing penalties for late payments and cutting back on infrastructure projects

Country, estimated to be owed up to $1.5trn, is increasing penalties for late payments and cutting back on infrastructure projects

China has become the world’s biggest debt collector, as the money it is owed from developing countries has surged to between $1.1tn (£889bn) and $1.5tn, according to a new report. An estimated 80% of China’s overseas lending portfolio in the global south is now supporting countries in financial distress.

Since 2017, China has been the world’s biggest bilateral lender; its main development banks issued nearly $500bn between 2008 and 2021. While some of this predates the belt and road initiative (BRI), Beijing’s flagship development programme has mobilised much of the investment in developing countries.

But a new report by researchers at the AidData research lab at William & Mary, a public university in Virginia, found that China, the world’s second largest economy, is now navigating the role of international debt collector as well as being a bilateral funder of major infrastructure projects.

  • hanekam@lemmy.worldEnglish
    1·
    1 year ago

    I’ve looked at all of the sources you provide, and they all point out the fact that countries experience bad outsomes after an IMF intervention, which nobody’s disputed. My argument is that countries in similar dire straights will experience even worse outcomes if there is no such intervention. As an example, I could name Venezuela, which experienced an extreme increase in child mortality, your favored metric, after leaving the IMF. The root cause is economic distress, not the IMF intervention.

    Minimizing the negative effects of government failure is absolutely worth examining. Identifying the mistakes made by the IMF in past interventions is a noble goal. But we should not blame international organizations when poor governance causes countries to fail.

    • livus@kbin.social
      1·
      1 year ago

      I understand your argument but it doesn’t really apply. With all due respect I don’t think you can have looked at my links very well.

      The TB one for instance found that TB gets worse whenever there is an IMF loan but not in the same circumstances when there is a loan from somewhere else.

      But we should not blame international organizations when poor governance

      You don’t seem to realize that IMF loan conditions have very specific governance requirements which directly impact governmental decisions around health spending.

      These are called Structural Adjustment Programs.

      There have been a bunch of these types of finding. Like I said, it’s well known in NGO circles.

      There is a reason China’s loans are so popular. I think being able to govern your health system as you see fit is a much more compelling reason for choosing a particular loan style, than some vague ideological mumbo jumbo.

      • hanekam@lemmy.worldEnglish
        1·
        1 year ago

        The TB one for instance found that TB gets worse whenever there is an IMF loan but not in the same circumstances when there is a loan from somewhere else.

        Yes, because the countries taking those loans aren’t distressed.

        There is a reason China’s loans are so popular.

        They are popular because they come with very little oversight. Countries with higher transparency do not find them very appealing, as Italy’s recent withdrawal from the program attests.

        You don’t seem to realize that IMF loan conditions have very specific governance requirements which directly impact governmental decisions around health spending.

        They come with very specific governance requirements which impact governmental decisions about a whole host of things, because those governments have proven incapable of sound fiscal management.

        Again, the IMF is in no way perfect and I’m sure there is a myriad ways the conditions of their loans can be tailored to minimize negative outcomes. But that does not mean they cause these problems any more than every cancer death being a failure of medicine means doctors cause cancer.