Belt and Road Projects must be subjected to transparency, economic assessment –Opposition Leader

May 03, 2019 News

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By Kiana Wilburg
Any project Guyana pursues via China’s Belt and Road Initiative (BRI) must be subjected to a transparent process and a rigid economic assessment says Opposition Leader, Bharrat Jagdeo.

Jagdeo, who is also the PPP General Secretary, made this declaration during a press conference at his Church Street Office yesterday.
There, Kaieteur News asked the Opposition Leader if he agrees with recent statements by the Managing Director of the International Monetary Fund (IMF), Christine Lagarde on BRI. The official noted that BRI should only go where it is needed and where it is sustainable.
Jagdeo told this publication that he agrees with Lagarde. Asked to say if he believes BRI is needed in Guyana, the PPP General Secretary said, “It depends on what you use the resources for… You have to use resources to either increase welfare so that the social return is greater than capital or use it in a manner that it can give you an economic return.
“So definitely, a careful examination of the Public Sector Investment Programme (PSIP) (is needed), looking at all the investment needs, mapping this out…”
He added, “We are supposed to have a rolling PSIP that is supposed to be four years ahead. And it should be underpinned by a vision of where you want to go and unfortunately, this government has had an ad hoc approach to the PSIP.”
The Opposition Leader said he is in favour of any initiative that is designed to help develop investment capital but how the country develops those resources is important. He emphasized however that it must be done transparently and an economic assessment must be conducted.
SUSTAINABILITY
While China’s Belt and Road Initiative (BRI) has the potential to stimulate infrastructural development, Lagarde says it should only go where it is needed and where countries can “sustainably” handle the debt that will follow.
Lagarde made these and other remarks to nearly 40 world leaders and other high-ranking officials at China’s second Belt and Road summit in Beijing. The three-day event ended on April 27, last.
The summit sought to encourage discussions on opportunities for growth that are possible for nations involved in the Belt and Road Initiative. There were also talks on ways to further promote trade, foster greater financial inclusion, and facilitate more people-to-people connections through BRI.
Lagarde’s presentation however, was focused on exposing that BRI is only successful in countries that need it and can subsequently service the debt that will be incurred.
The Managing Director said, “To borrow from a Chinese proverb, ‘It is easy to start a venture — the more difficult challenge is what comes next.’ That is where we find ourselves today, at the more difficult challenge. The BRI is clearly having an impact. From stimulating infrastructure investment to developing new global supply chains, some of the promises of BRI are being realized.”
Lagarde added, “Consider Kazakhstan, where a new manufacturing zone is beginning to unleash previously untapped economic potential. Or look at Senegal, where robust economic growth of over six percent in each of the last four years was supported partly by BRI-linked investment projects, including the construction of a new highway linking the airport to three large cities.”
At the same time, the IMF Managing Director alluded to the fact that other nations have not been so lucky. She said, “History has taught us that, if not managed carefully, infrastructure investments can lead to a problematic increase in debt.
“I have said before that, to be fully successful, the Belt and Road should only go where it is needed. I would add today that it should only go where it is sustainable, in all aspects…”
Locally, Kaieteur News has been at the forefront of exposing how the debt burden from China’s BRI has been breaking the backs of nations which signed up for it.
Sri Lanka for example was forced to sign over its strategically important Hambantota port to a Chinese state-owned company on a 99-year lease in 2017. The transfer of the port was to lift some of the enormous billion-dollar debts Sri Lanka owed to Beijing, debts which came from loans that helped fund Hambantota in the first place.
Other countries which have landed in the same boat with Sri Lanka include Pakistan, Djibouti, the Maldives, Fiji and Malaysia. (See link for further details: https://www.kaieteurnewsonline.com/category/chinas-modus-operandi/).
In spite of the revelations made by this newspaper and the international reports warning countries about the BRI being nothing more than a debt trap, Guyana still signed up. Other Caribbean nations which have done the same include Jamaica, Barbados, Venezuela, Costa Rica, Panama, Trinidad and Tobago, Dominica, and the Dominican Republic.

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