All mistakes for the crisis in both countries cannot be placed above Beijing’s shoulders as the majority of them rely on the leadership of Mielis from these countries.
Eighteen kilometers from the Port Hambantota owned by China in Sri Lanka located Mattala Rajapaksa International Airport, which unfortunately gets Sobriquet into an airport that is mostly used in the world. Built during the presidency of Mahinda Rajapaksa, both ports and airports, which are built from high flowering loans from Bank Exim China, are monuments for fiscal profligations practiced by the ruler of the island country is currently shaken in deep economic and political crises.
Like Sri Lanka, Pakistan is also the largest beneficiary of economic assistance from China and it has also dropped into political and economic chaos. Instead of Chinese loans make both more resilient economies, Beijing client countries have literally folded after the global economic crisis caused by a pandemic, which is ironically coming from Wuhan, China.
Sri Lanka is currently shaken in protest because of a raging inflation; Pakistan was dropped freely with Imran Khan Niazi now the prime minister was only in the name after truly exposing the fragility of democracy in the Islamic Republic for his own survival.
The media of the Chinese Communist Party (CCP) fired the Predator’s Predator’s economic policy as Western propaganda and confirmed that loans provided to countries such as Pakistan and Sri Lanka were only a small part of their overall debt portfolio. This Chinese claim is proven by information available openly about government loans to the government from China. But this is only half of the story as information about the actual obligations or outflows of loan countries due to investment returns, commercial loans etc. Not available.
As in the case of Pakistan, Beijing has stated that the loan consists of 10 percent of Sri Lanka’s overall foreign debt. This managed to become USD five billion of total debts nearly USD 51 billion. But this figure does not include swap currencies, large-term foreign currency facilities, and loans provided by Chinese state-owned companies. The wise loan of the project provided by the Bank Exim China is estimated at USD 4.8 billion, where only USD one billion brings a two percent concession rate while the rest brings a six percent defeat level.
In Pakistan, the Bank Exim Tiorghum has lent USD 11 billion (soft) with an interest rate of 1.6 percent for infrastructure projects and USD 15.5 billion (commercially) which brought a 5-6 percent interest rate for power projects under China . Pakistani economic corridors, parts of BRI and are designed to provide Beijing access to the Arab Sea and so on. All debts are denominated in USD dollars, which avoid Chinese exposure to exchange rate fluctuations but increases the cost of harsh currency for borrowers. In Pakistan, the debt burden consistently increases due to regular depreciation of Pakistani rupees with an average of six percent per year. In Sri Lanka, Lankan Rupees collapsed in a matter of days, increasing the cost of dramatically hard currency.