Never worry about any ‘debt trap’: Beijing to Dhaka

Chinese Ambassador to Bangladesh Li Jiming has said Bangladesh should never worry about bad debt or so-called debt trap, noting that Bangladesh has managed foreign debt very well with an excellent system in place.

"I would say that you've managed foreign debt very, very well, and there's no such bad debt so far at all. You've earned a very, very high credit internationally in terms of [managing] international debts. So, never worry about that," Ambassador Li said.

The Chinese ambassador also said China will continue to serve as a "bridge of communication and try its best to facilitate early results" as Bangladesh seeks early repatriation of Rohingyas to Myanmar.

"We fully understand the keenness of Bangladesh to start repatriation, and our determination to help the two friendly neighbours resolve this long-standing issue will never change," he told an online symposium titled "Bangladesh-China Relations: Prognosis for the Future" hosted by the Cosmos Foundation on Thursday evening.

Cosmos Foundation Chairman Enayetullah Khan delivered the opening and concluding remarks at the event while Dr Iftekhar Ahmed Chowdhury, renowned scholar-diplomat and adviser on foreign affairs to the last caretaker government, chaired the session.

Ambassador (retd) Tariq A Karim, Centre for Policy Dialogue Distinguished Fellow Dr Debapriya Bhattacharya, former foreign secretary Shamsher M Chowdhury, Assistant Researcher of the Institute for International Studies at Yunnan University Dr Zou Yingmeng, Assistant Research Fellow at China Institute of International Studies Dr Ning Shengnan, former ambassador Serajul Islam and Dhaka University Professor Dr Rashed Al Mahmud Titumir comprised the panel of discussants.

The example of Sri Lanka came up in the context of a country that fell into a "debt trap" as a result of public investment projects financed by China.

Ambassador Li, who delivered the keynote address at the symposium, however, said there is no proven evidence that China created any "debt trap" in any country, including Sri Lanka and Bangladesh.

"I think you've an excellent system and you've excellent officials and ministers to take care of that. So, never worry about that," said the ambassador.

Referring to an article he read regarding Sri Lanka's debt situation, the Chinese envoy said the total Chinese debt accounts for less than 8% of the whole debt of that country and of this 8% Chinese debts, much less is related to the Belt and Road projects.

The ambassador also said there is government-to-government debt, which is normally a soft, concessional loan with a very low interest and for a very long period of time.

Dr Debapriya of the CPD said China has emerged as a big financial investor in Bangladesh involving major projects and those projects have major infrastructural implications.

Now there is a debated issue across the world whether this kind of financial flow is a "debt trap" for countries like Bangladesh as it happened in Sri Lanka, he said.

"Thankfully, Bangladesh's external debt remains moderately manageable and most of the country's debts are from the multinational agencies and at this moment it is not China," said the economist.

Dr Debapriya, however, said they should be really mindful about the debt repayment issue although they are in a comfortable position at this stage. Bangladesh's total outstanding debt burden is well under 40% of GDP.

"But there are projections that this debt issue would be a challenging point for the Bangladesh-China relationship beyond 2024," he added.

Ambassador Li said the two countries – Bangladesh and China – need to advance the Belt and Road Initiative (BRI), noting that there is no doubt that closer cooperation under the BRI will strengthen strategic partnership of cooperation.

Bangladesh is the first South Asian country to sign up for the BRI, which was first proposed by President Xi Jinping in 2013.

Ambassador Li said last year, braving the huge threat of Covid-19, many Chinese managers, engineers, technicians and workers in Bangladesh chose not to leave for home, thus ensuring the steady progress of major BRI projects in Bangladesh.

Statistics show that the accumulated infrastructure construction contract volume between China and Bangladesh has reached $72.6 billion by the end of 2020, said Ambassador Li.

The Chinese ambassador emphasised that China had never taken India as a "strategic rival" rather they considered India a good neighbour of China.

He, as the Chinese ambassador to India's neighboring country – Bangladesh, hoped that this China-India relationship would be improved more in the future.

Historically, Ambassador Li said, they have more than 2000 to 3000 years of good relationship with India, and "Any Chinese intellectual, who is well-educated, would have a special feeling. A good feeling, towards India – that's something untold publicly probably."

Rohingya repatriation

While delivering the keynote speech, Ambassador Li said the sudden change in Myanmar earlier this year – the coup in February – caught them all by surprise, and created some uncertainties over the repatriation process.

Right now, he said, China is closely observing the situation in Myanmar, hoping the country could return to normal soon.

Former ambassador Tariq Karim said, "I would request China to support us in our efforts to augment regional and sub-regional cooperation on a number of issues which will have consequences with China, particularly in resolving the Rohingya issue, not just in Bangladesh, but particularly in its point of origin where China has the capacity to help us resolve it."

Referring to Ambassador Li's remarks about the Rohingya issue, Shamsher Mubin Chowdhury said Bangladesh had got many promises and assurances of the satisfactory resolution of this issue.

"It's a humanitarian issue which has a potential of becoming a security issue if it's not resolved satisfactorily keeping in mind the dignity, and honour of this community of people who are facing the UN described the textbook example of ethnic cleansing," he said.

The former diplomat thinks the countries that have the leverage to play the right kind of role in finding a solution should step up and look to finding a peaceful resolution without any further delay.

He questioned whether the Rohiganys are the victims of regional geopolitics and geostrategic interests. "I think this is the question Bangladesh needs to ask the major players in the region very frankly and candidly...It's a much more humanitarian issue and I think it has to be faced effectively and timely."

Dr Rashed Titumir said citing the crisis in the Rakhine state as a complex and historic one, China has defended the Myanmar government.

The analyst said India is also competing for influence in Myanmar and is critical of the Belt and Road Initiative of China.

Bangladesh has long been exploring ways with the international community to begin repatriation of the Rohingyas to their place of origin in Rakhine state.

The repatriation, however, could not be commenced in the last four years with two "failed attempts" amid "lack of confidence" among Rohingyas and "lack of conducive environment" in Rakhine State.

Discussions with Myanmar have remained halted for a long time amid Covid situation and subsequent military coup in Myanmar.

Quad and Li's thoughts

As one of the discussants raised the Quad issue – the four-country alliance between the USA, Australia, Japan and India, that is seen as anti-Beijing, the ambassador took the opportunity to explain what he said on the issue of Bangladesh possibly being invited to join, at a particular programme.

"As an ambassador to Bangladesh, the first foreign policy lesson I learned is that Bangladesh adheres to the idea of 'friendship to all and malice to none'. So, I have full confidence that Bangladesh won't be part of that small clique," he said.

"But when I was asked if you would like to see or do you think this is a good idea for Bangladesh to do so, of course, I would say no. What else can you expect from me? Should I say yes? That would have been ridiculous," Ambassador Li added.

He said he has full confidence and China has full confidence in Bangladesh that it would never take part in any small clique, especially involving military or security purposes. "This is the history that already taught us that Bangladesh would never do that."