Bangladesh Finance Minister Mustafa Kamal on Tuesday warned that developing countries must think twice about taking more loans through China’s Belt and Road Initiative. He said global inflation and slowing growth add to the strains on indebted emerging markets.
Kamal pointed to Sri Lanka and the current economic turmoil it is in. He attributed the same to failure of Chinese-backed infrastructure projects to generate returns. He also said that China needed to be more rigorous in evaluating its loans amid concern that poor lending decisions risked pushing countries into debt distress. “Whatever the situation [that] is going on worldwide, everybody will be thinking twice to agree to this project,” he said in an interview, referring to BRI. “Everybody is blaming China. China cannot disagree. It’s their responsibility,” Kamal told Financial Times.
“Whichever projects are essential and are in process and will pay off as fast as possible, we’re only taking care of those. To other projects, we’re saying, no thank you,” the lawmaker added.
Last month Bangladesh approached the IMF (International Monetary Fund) for financial assistance as its economy is under strain. As a result of Russia's invasion on Ukraine, prices of commodities has risen and the countries foreign reserves has taken a hit. China’s foreign minister Wang Yi visited Bangladesh over the weekend and met with several officials including Prime Minister Sheikh Hasina.
Dhaka, a participant in China's BRI, owes China about $4 billion.
