There is mounting concern in the United States that calls for debt relief from Africa and other developing regions that have been hit hard by COVID-19 and the subsequent economic crisis will only help those countries to pay back loans to China.
A group of U.S. Senators led by Banking Committee Chairman Mike Crapo and Finance Committee Chairman Chuck Grassley wrote a letter last week to Secretary of the Treasury Steve Mnuchin and Secretary of State Mike Pompeo that any financial assistance should also include disclosures of a country’s debts to China or other legal obligations as part of Beijing’s Belt & Road Initiative.
“Short of this, U.S. and other Western taxpayers would be in essence bailing out Chinese financial institutions and enabling China’s debt-trap diplomacy,” the senators wrote.
Read more on the story by Reuters on the Asahi.com website and also a story on the Nikkei Asian Review website about how the COVID-19 in Djibouti “increases risk of China debt trap.”
