Monday, October 15, 2018

Five eyes alliance could become many more, we hope.

"With little fanfare, Trump signed a bill a little over a week ago that created a new foreign aid agency -- the US International Development Finance Corp -- and gave it authority to provide $60 billion in loans, loan guarantees and insurance companies willing to do business in developing nations." "China's biggest investments are targeted to countries, like Pakistan and Nigeria, with a goal of expanding Beijing's geopolitical power and gaining access to natural resources like minerals and oil." "The investments have raised concerns that poor and emerging nations like Djibouti and Sri Lanka could be increasingly beholden to China, which can seize assets if countries default on loans." Sri Lanka gifted the Hambantota port to China on a 99 year lease which is largely avoided by commercial shipping. Much to India's worry China's long term plan is to convert the port into a naval base for Chinese warships. Pakistan is forced to seek financial support from the International Monetary Fund (IMF), for up to $10 billion, as it has done 10 times since 1990. But it will not be easy because of the enormous costs of the China-Pakistan Economic Corridor. "In fact, it's likely that CPEC's cost to Pakistan are much higher than would make sense for the projects in question. Worse, currently these costs are opaque and some are hidden by the security establishment behind a veil of secrecy," wrote M Sharma. "The IMF doesn't operate like that; it will expect to be told, transparently, what the actual costs are for the CPEC projects. That's the point at which Khan's backers in the military will begin to worry, because if the terms are as ruinous as suspected, support for the CPEC -- and by extension, for China's paramountcy in Pakistan -- will wither." Pakistan has vowed to share all CPEC details with the IMF team which flies in on 7 November. Politicians in the US have asked the IMF to ensure that none of its money is used to pay off Chinese bondholders. In response, China denied that Pakistan's debt problems are due to the CPEC project. Donald Trump has imposed tariffs on Chinese imports worth $250 billion, increased military support for Taiwan, accused China of interfering in US elections and cut China's access to US nuclear technology. Political commentator Hua Po "doubted that the United States would enjoy the support of its allies, especially in Europe..." At least, the US has allies, China has none. A 'Five Eyes' alliance of Australia, Britain, Canada, New Zealand and the United States is sharing classified information on China with Germany and Japan and with each other. All countries are waking up to China's predatory practices and "China's free ride could be coming to an end", wrote Prof B Chellaney. We absolutely hope so.

No comments: