Bangladesh Finance Minister warns developing countries, says - think twice before taking Chinese loan

Bangladesh Finance Minister warns developing countries, says - think twice before taking Chinese loan

Bangladesh Finance Minister Mustafa Kamal has warned developing countries to take loans from China through the Belt and Road Initiative. He said that China should think twice before taking a loan as Beijing's bad credit decisions have put these countries in a debt crisis.

warned China

Kamal Mustafa also cautioned Beijing to follow a more robust process for valuing its loans, saying such bad loans put pressure on indebted emerging markets. He said that a project needs a thorough study before lending it.

Everyone must be thinking twice to agree to the BRI scheme

The Bangladeshi Finance Minister made these important remarks in an interview with the Financial Times. Referring to BRI, the minister said, "Whatever the situation is going on around the world, everyone must be thinking twice to agree to this project."

'Everyone is blaming China

He said, 'Everyone is blaming China. China cannot disagree. This is their responsibility. After Sri Lanka, we realized that the Chinese authorities are not paying attention to this particular aspect, which is very important.

Last month, Bangladesh became the latest country in Asia to approach the International Monetary Fund (IMF) for funds as the economy is under strain due to rising commodity prices after the Russia-Ukraine war, which has taken a heavy toll on the country's foreign reserves. is inserted.

China gave a loan of 4 billion US dollars to Bangladesh

Bangladesh is also a participant in China's BRI and currently, Dhaka owes Beijing about US$4 billion, or 6 percent of its total external debt. Amazing remarks came when Chinese Foreign Minister Wang Yi visited Bangladesh over the weekend for a meeting with officials, including Prime Minister Sheikh Hasina.

China calls itself Bangladesh's most reliable long-term strategic partner

In a statement, China described itself as "Bangladesh's most reliable long-term strategic partner" and said the pair agreed to strengthen "cooperation in infrastructure". Despite approaching the IMF for the fund, Kamal said Bangladesh is not at risk of default like Sri Lanka.

IMF's $62 billion debt on Bangladesh

According to the IMF, Bangladesh had a total foreign debt of US$62 billion in 2021, with most from multilateral lenders such as the World Bank.

The Bangladeshi government inaugurated the USD 3.6 billion Padma Bridge near Dhaka in June. The project was Chinese-built but was financed domestically after international lenders withdrew money over a corruption scandal, although the allegations were never proven.

However, the government has responded to the economic slowdown by canceling a series of planned infrastructure upgrades, including investments in building 5G networks and upgrading highways.

(with language input)