THE HIDDEN DEBT TRAP: THE POLITICAL PROPAGANDA OF CHINESE DEVELOPMENT ASSISTANCE TO JAMAICA
In light of recent default on Chinese Infrastructure loans why most Jamaicans are of the opinion that China is in Jamaica as a Good Samaritan with their so-called investments hidden from public oversight and scrutiny? Or perhaps the more fundamental question is, what steps the government has taken to safeguard our Strategic asset from falling into the hands of China in the event of a default?
We have seen where the deception in China business and investment practices have led to several countries defaulting on their infrastructure loans from Africa to Asia and can’t help thinking when will this wave of default hit Latin America and the Caribbean. Jamaica in particular with one the highest debt to GDP ratio in the region, just below 100%. Chinese cannot be blame entirely, but they must have figured that the financial risk was very high before they engage in dispersing billion of dollar in infrastructure loans.
According to reports to date, “China gave billions to Djibouti, they were unable to pay back. Now China has confiscated their harbour as collateral damage. China gave Maldives a loan they were unable to pay. Now 38+ percent of the state owned resorts belong to China, Madagascar couldn’t pay, lands were used as collateral damages, Zambia can’t pay their loan china is taking over their airport and airspace next month (military jets included), Ethiopia couldn’t pay back the loan, now the rail way system belongs to Chinese and Kenya, 70% of their mineral resource mines belongs to China, because they couldn’t repay the loan.”
It was also reported that “Chinese nationals are gradually taking control of the economy of most African countries. For example in Zambia, Chinese nationals have become powerful and influential such that they can get anything they want at the expense of the citizens. Really, their influence is so strong and evident that a few months ago, the Inspector General of Police Kakoma Kanganja appointed eight (8) Chinese into Zambia Police Service, an act that brought out a national outcry.”
Data available reveals that the loans that Zambia has contracted from China in the last 5 years are so enormous that Chinese nationals are taking advantage and behaving with impunity. Just over five years the government of plunge Zambia into a debt trap with China by accumulating over US$7.8 billion in infrastructure loans.
In the case of Jamaica the extent of our default risk is unknown as there exist a “cover of darkness” on the overpriced Chinese projects not monitored by the Office of the Contractor General. We just have to think about it, Zambia’s Debt to GDP ratio is 56% and they defaulted, Jamaica’s is just under a 100%, should we not be worried? and why hasn’t the people of Jamaica given the opportunity to know what is the state of Jamaica’s risk exposure?
