It’s not surprising that a lot of people, including the U.S. Secretary of State, remain mistaken in their belief that the Chinese seize physical assets in the event of a loan default, given that it continues to appear in news reports — including yesterday’s Wall Street Journal.
The headline and sub-head of the WSJ imply that the report is about how Zambia’s state-owned mining company took a very risky decision to take on $1.5 billion in debt to acquire Mopani Copper Mines from the Anglo-Swiss mining giant Glencore. But the story barely mentions the Chinese, except for making the dubious claim that because China is Lusaka’s largest bilateral creditor, if the mine encounters financial difficulties it could be forfeited to Chinese creditors.
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