Chinese-financed railways in Asia and Africa have sparked enormous controversies over whether it was wise for countries like Kenya, Indonesia, Nigeria and Laos to put themselves in so much debt for infrastructure that will take decades to become profitable, if it ever does.
While a lot of stakeholders in these countries have raised those concerns, Chinese officials and scholars are especially piqued when these barbs come from critics in the U.S. and Europe.
The issue was on many people’s minds last week during Cambodian Prime Minister Hun Sen’s state visit to Beijing when he was widely expected to call on China to finance an upgrade of its existing rail lines to high speed railways.
This prompted Xu Liping, director of the Center for Southeast Asian Studies at the Chinese Academy of Social Sciences (CASS), one of China’s most prestigious think tanks, to write a rebuttal in the nationalist tabloid Global Times against Western accusations that these kinds of rail investments are too costly for low-income countries:
When analyzing high-speed rail revenues, the West, based on its own development experience, speculates on China’s relative revenues in countries along the Belt and Road, which is logically deceptive.
This is because high-speed rail income must calculate not only the income from passenger ticket prices and cargo transportation, but should also include the comprehensive income of commercial development along the high-speed railway.
The West often only calculates the former, but lacks the analysis and judgment from its own experience for the latter, which is a major flaw.
WHY IS THIS IMPORTANT? It’s scholars like Xu from places like CASS who do a lot of the leg work in developing China’s official response to critics in the West and elsewhere over its lending practices. Usually, the Chinese focus more broadly on rebutting the “debt trap” accusation, but this is one of the first times we’re seeing a specific focus on rail financing.
SUGGESTED READING:
- Global Times: ‘Debt trap’ rhetoric a replica of Western-centric thinking, won’t affect China-Cambodia cooperation by Xu Liping
- South China Morning Post: Cambodia’s Hun Sen to head to China in search of high-speed rail support by Kawala Xie
