For some time now, I have been closely following the developments in the China Belt and Road Initiative; to be frank with you, I am no longer comfortable with the feelings am having.
As a professional accountant who understand some bankruptcy and insolvency rules and fundamentals of economics, I cannot keep quiet any longer. The bankruptcy rule as it applies to individuals and companies have human face compared to what is obtainable when a country defaults in paying for her debts.
Yes, some countries do get their debt written off (Nigeria for example) but I still believe that there is nothing like free lunch especially when it involves international politics. How much does Nigeria owe now? I do not know the terms of the debt forgiveness agreement but I can almost assure you that there are toxic baits embedded- only for the foresighted.
My gut feelings about China belt and road initiative
China in her quest for becoming the big brother of the world is using her excess reserves to tie sovereign nations into debt and then systematically take over the country. No country in our modern economy understands the mechanics of the intricacies that exits between business and politics.
China through its loan for infrastructure strategy have already conquered quite a number of countries and still longing to conquer more countries. Countries like Sri Lanka and New Papa Guinea now understands this trap a little better than most countries. Infrastructures built with borrowed money were taken over by the lenders – Chinese unfortunately.
Nigeria as a country is gradually being entangled in this ‘China rat race cycle’ all in the name of building economic ties.
I recently attended a workshop in organized by the Nigerian government where the theme in my opinion is all about encouraging Nigerians to desire more of the Chinese yuan than the US Dollars.
Who knows what other deals have been finalized or are being finalised at the government level. However, what I do know is that there is serious danger locking if Nigeria do not wake up from its slumber.
How much does USA owe China again? Okay, enough about my gut feelings and rambling.
What is China Belt and Road Initiative?
Accounting to worldbank.org, the belt and road initiative (BRI) is an ambitious effort to improve regional cooperation and connectivity on trans-continental scale. You can refer to the above link for detailed account of the initiative.
To cut long story short, the basic idea is that China wants to connect to Africa through Europe by a combination of roads, railways, shopping malls and possibly seaways with the sole aim of creating/ finding more markets for their products and services.
Potential benefits of BRI
But wait a min, I see the light and the end of the tunnel if this white elephant project happens to see the light of the day. Here are some of the potential benefits of the China Belt and Road Initiative (BRI).
- Redistribution of wealth
- Promotion of world peace
- Cheaper cost of capital
- Reduced trade cost
Nothing wrong with stimulating the economy by way of creating credits. What is however wrong is having an ulterior motive behind the numbers. Is it time for the world to have a governing body in charge of policing the world rather than a country taking that role at any point in time.
The Ancient Greek to the Roman Empire to the Egyptian era to the USA and now gradually shifting to China, all have one thing in common; conquer the world at all cost.
If by chance you are looking for a foreign language to learn, you better think Mandarin or any variant of Chinese language