Emerging market debt risks drive US, China to work together

As 28 countries, including Pakistan, Laos and Sri Lanka, suffer from a debt trap, despite past criticism and amid high US interest rates, Washington is asking China to help mitigate the debt risks.

Tekef Tekef
Mar 5, 2024 - 21:02
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Emerging market debt risks drive US, China to work together

As 28 countries, including Pakistan, Laos and Sri Lanka, suffer from a debt trap, despite past criticism and amid high US interest rates, Washington is asking China to help mitigate the debt risks.

March 05, 2024

The US and China, who are competing for influence over the developing world, are partnering to resolve a growing debt risk in emerging markets. Ironically, US politicians have accused China of laying debt traps in developing countries, where countries default on Chinese debt and are allegedly forced to yield assets to China.

In a speech to the Hudson Institute on October 4, 2018, then US vice president Mike Pence said, “In fact, China uses so-called “debt diplomacy” to expand its influence. Today it is offering hundreds of billions of dollars in infrastructure loans to governments from Asia to Africa to Europe and even Latin America. Yet the terms of those...

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