Is the Belt and Road Initiative a blessing or a trap?

Spoiler: The Belt and Road Initiative (BRI) is often described as blessing for the countries that are part of it. The BRI is supposed to increase trade and growth. China provides the funding, the expertise and often much of the labour force.

But it might be a good idea to ask why China wants to pursue these infrastructure project when other international lenders don’t. There is no shortage of global capital, on the contrary. Infrastructure projects are long term and often yield low returns. Low and uncertain returns in the far future in combination with very high capital costs scare most lenders away.

But Chinese lenders seem willing to take on high risks. The reason Chinese lenders undertake projects that may not be profitable is that they can call Beijing to pick up the tab. And Beijing can put pressure on the borrowers.

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Bolivia – another socialist president gone rogue.

Spoiler: It wasn’t a coup. Morales’s manipulation of the vote-counting in the Presidential election turned people against him. This was his last, of many, attacks on democracy in Bolivia. Since 2006, Morales has concentrated power, placed lackeys in the Constitution court, limited the independence the judiciary, attacked the media and oppressed civil society organisations. But Morales shall have credits for improving the lives of many Bolivians. Since he became president in 2006, extreme poverty has been halved, inequality has decreased and GDP per capita has on average grown by some 3.2% per year. At the same time has life expectancy increased by five years and neonatal mortality decreased by almost 50%.

The reality is not black and white even if one sometimes gets that impression from reading the news. The opponents to Morales are no angels and I would not accept an invitation from the interim president who abuses her interim presidential powers to the extent that security forces’ killings of pro-Morales demonstrators can go unpunished. The security forces’ killings and detentions of Morales supporters are of course unacceptable. If she doesn’t keep her promises of new and fair elections, sanctions should be imposed.

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Maybe Chile isn’t so bad after all

Spoiler. The current demonstrations and riots in Chile that started as protests against a 3.75% increase in public transportation tariffs. The focus of the demonstrations seems to have turned into demands of a fairer society. The protests may be justified. And the rage over military forces patrolling the streets, reminding people about Pinochet’s brutal regime is understandable.  But contrary to what we read and hear from the often-ill-informed media, and what Leftists want us to believe, the people of Chile are not subject to oppression and impoverishment by neo-liberal policies. In fact, if one looks at Chile over time, incomes have increased, and inequality decreased.

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