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Archive for the tag “debt”

This Is How The Coronavirus Will Destroy The Economy

In key ways the world is now as or more deeply in debt as it was when the last big crisis hit. But the largest and most risky pools of debt have shifted — from households and banks in the United States, which were restrained by regulators after the crisis, to corporations all over the world.

Read Here – The New York Times

The COVID-19 Debt Deluge

How long the COVID-19 crisis will last, and what its immediate economic costs will be, is anyone’s guess. But even if the pandemic’s economic impact is contained, it may have already set the stage for a debt meltdown long in the making, starting in many of the Asian emerging and developing economies on the front lines of the outbreak.

Read Here – Project Syndicate

How Much Money Does The World Owe China?

While China’s role in global trade is highly publicised and politically polarising, its growing influence in international finance has remained more obscure, mostly due to a lack of data and transparency. Over the past two decades, China has become a major global lender, with outstanding claims now exceeding more than 5% of global GDP. Almost all of this lending is official, coming from the government and state-controlled entities.

Read Here – Harvard Business Review

The Approaching Debt Wave

The World Bank has warned that a massive debt wave is building worldwide. There is no telling who will be hit the hardest, but if vulnerable countries, from the United Kingdom to India, do not act soon, they may face severe economic damage.

Read Here – Project Syndicate

Debt Looks Like The ‘New Normal’ For The Global Economy – Until The Next Crisis

In the “new normal” economic world, many beliefs have been turned on their head. Trade wars supposedly  do not cause lasting harm, declining corporate output, earnings and investment are no cause for alarm, stock prices can go on rising regardless, and record global debt is nothing to lose sleep over.

Read Here – South China Morning Post

How China Can Offer Pakistan A Path From The Precipice

Introduced under considerable fanfare in 2015, CPEC provides much-needed financing for infrastructure and energy pipelines that Pakistan could not entice other investors to underwrite. However, the expected payoff is unlikely to compensate for the sizable risks to which these investments expose the Pakistani economy.

Read Here – RealClearWorld

Is Sri Lanka Really A Victim Of China’s ‘Debt Trap’?

The economic reality is that Sri Lanka leased out Hambantota port to China largely due to a persistent balance of payment (BOP) crisis resulting from the reduction of trade over the years even while external debt servicing costs have been soaring. Sri Lank faced a severe shortage of foreign reserves in light of the upcoming debt servicing payments, due to the maturity of international sovereign bonds. Therefore, the country had to look for various avenues to obtain foreign currency inflows. Leasing out Hambantota port was one of the ways to increase the country’s foreign reserves.

Read Here – The Diplomat

Africa Is A Continent On The Brink … But Of What?

 

It makes sense that a continent home to 54 countries and 1.2 billion people would also house a mass of contradictory developments. Africa features several of the world’s fastest-growing economies and a burgeoning middle class. But much of the continent remains mired in debt, ravaged by conflict, disease or terrorism, and plagued by elites clinging to power.

Read Here – World Politics Review

The Belt And Road: The Good, The Bad, And The Mixed

Much of the narrative on China’s Belt and Road Initiative (BRI) has been polarised…Neither of these polarised narratives seems to fully account for the complex and heterogeneous variety of activities in the BRI.

Read Here – The Diplomat

‘China’s Manhattan’ Borrowed Heavily. The People Have Yet To Arrive.

Chinese local governments are swimming in debt. By official accounts, that debt totals $4.5 trillion. By unofficial estimates, it could be as large as $10 trillion…China has long borrowed heavily to build and then counted on breakneck economic growth to pay it back. The script: Sell vast amounts of land to developers, borrow to subsidise construction, and jobs and new cities will result. It was a model that helped China build its skyscrapers and high-speed rail lines and ushered in an era of prosperity.

Read Here – The New York Times

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