LATELY there have been discussions in the media, especially a remark attributed to a minister who has stated that China- Pakistan Economic Corridor needed to be reviewed.
Those who are propagating unnecessary fear and despair by arguing that Pakistan would become so entrapped in debt burden that it would lose its economic sovereignty and forced to cede its territory i.e. Gwadar port-to-China are sadly mistaken. However, we also need to look at parallel developments elsewhere.
Debate in Myanmar now focuses on plans for a $7.3 billion deep water port at Kyaukphyu on the Bay of Bengal. Western economists struggle to see what Myanmar gains from Kyaukphyu, which is far from the country’s commercial capital, Yangon. They have no trouble seeing what China gets: an opening to the sea for its landlocked south-western province of Yunnan.
They point to the precedent of Hambantota, a port built by China in Sri Lanka that passed into Chinese hands in 2017, along with 69 square kilometres of land, after the Sri Lankan government could not service debts incurred in its construction. Former Sri Lankan officials have told the New York Times of other, secret Chinese terms, for instance a demand to share intelligence about all traffic through the port.
Immediately, China does not systematically report lending overseas, which heightens the mystery and unease about goals that may stretch well beyond the economic.
Money spent building coal-fired power stations, notably in Pakistan, is also a concern.
In March 2018, the Centre for Global Development published a paper naming eight countries at high risk of debt distress, including Pakistan.
During a visit to Beijing in August, Malaysia’s Prime Minister Mahathir Mohamad said his country would shelve three China-backed projects, including a $20bn railway.
The above analysis shows that CPEC projects are most likely to bring positive economic and social benefits to Pakistan, provided we strengthen our response and absorptive capacity in terms of business model, institutions, policies and transparency. As such a review is quite necessary by the present government in consultation with Chinese authorities.
Shahab Afroz Khan
Karachi
Published in Dawn, September 28th, 2018
