These two African railway megaprojects tell us a lot about China’s development model
After extensive negotiations, the Chinese government in January agreed to let Kenya defer $245 million in repayments on loans from state-owned China Exim Bank. The reprieve was likely a relief to Kenya’s government, which borrowed over $4.7 billion to build the 298-mile Standard Gauge Railway project connecting the port of Mombasa with the capital, Nairobi.
But some economists question the financial viability of the project, along with the high costs. To critics, Kenya’s railway project represents another example of Chinese-owed debt, and China’s growing influence in Africa. Indeed, many commentators point out that Kenya has an estimated $9 billion in China-financed debt — and note their concerns that a growing number of projects under China’s Belt and Road Initiative, in Africa and elsewhere, may be upending a Western development financing model based on rule of law and high environmental standards.… Seguir leyendo »