Jakarta –
Shocking news came from Uganda. The East African country is reported to have failed to pay its debt to China so that it gave up its infrastructure, namely Entebbe International Airport.
Uganda is not the only country in debt with China. Some countries have also suffered a similar fate so that they must accept the consequences.
Here’s the list as summarized detik.com, Monday (11/29/2021):
1. Sri Lanka
In the news detik.com In 2018, Sri Lanka gave up its ports and airports to be managed by China. China is known to finance the Hambantota port project located on the southern coast of Sri Lanka through debt assistance of US $ 1.5 billion. The assistance was given in 2010.
However, in 2017 Sri Lanka had to give up the port to China because it was unable to pay its debts. The decision was made by signing a contract to serve China’s state-owned company for 99 years.
The reason, at that time Sri Lanka was recorded to have a debt of US $ 8 billion to China. If calculated, to pay foreign debts to China and other countries will spend 94% of Sri Lanka’s gross domestic product (GDP).
Malcolm Davis, a senior analyst at the Australian Strategic Policy Institute, said that China’s move to take over the port was profitable. Because then China can have the advantage to export goods to India more easily.
“The port is not only a strategic route to India for China, but also gives China an advantageous position to export its goods into the Indian economy, thereby achieving a number of strategic objectives in that regard,” he explained.
2. Zimbabwe
Rizal Taufikurahman, a researcher at the Institute dor Fevelopment of Economics and Finance (Indef), revealed that several countries are in debt to build infrastructure. These countries include Angola, Zimbabwe, Nigeria, Sri Lanka, South Korea, Japan and China.
He said that not all of the debts that support infrastructure development in the country seem to give positive results. There are several countries of which it ended in failure alias bankrupt.
“So there are bad stories and success stories. The bad stories are Angola, Zimbabwe, Nigeria, Pakistan and Sri Lanka,” he said, March 21 2018.
Indeed, the debt is not only used for infrastructure development. As is known, since 1998, Zimbabwe has sent troops and purchased equipment from China to help President Laurent Kabali fight Ugandan and Rwandan rebels.
To finance all these activities, Zimbabwe must owe China with an accumulated value of up to US$ 4 million or Rp. 54.8 trillion (exchange rate of Rp. 13,700).
However, due to not being able to manage its debts properly, Zimbabwe could not pay its debts and finally had to follow the wishes of the bamboo curtain country by changing its currency to the yuan in exchange for debt relief. This has been in effect since January 1, 2016 after being unable to pay the debt due at the end of December 2015.
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