The Belt and Road Initiative (BRI) will not lead to a debt crisis for countries that borrow money from China to finance infrastructure projects, Li Jiming, director-general at Foreign Affairs Office of Yunnan province of China, said.

He was speaking at a press conference in Yunnan on Friday.

Reacting to criticism that the BRI may become a debt trap for many countries such as Pakistan and Myanmar, which borrow money from China to finance road or rail projects connecting China with neighbouring countries and countries along the Belt and Road route, Li said China’s loans to other governments carry very low interฌest rates so they would not put high pressure on the economy of those countries.

While China’s loans to private companies may carry higher interฌest rates, projects are carefully screened via feasibility studies, he assured.

“The debt crisis is unlikely to happen,” he said through a translator.

He also assured that China would not interfere in the sovereignty of countries or dominate the region via Belt and Road projects. 

The deepening cooperation between China and other countries is aimed at creating mutual benefits and sharing prosperity, he stated.

Yunnan on June 14 hosted the first-ever China-South Asia Forum in parallel with the 5th China-South Asia Expo and the 25th China Kunming Import & Export Fair. Yunnan province has been actively promoting trade and investment with South Asia and Southeast Asia.

The first China-South Asia Cooperation Forum (CSACF) concluded on Friday with participants promising closer cooperation in key areas including inter-connectivity, business, local government, poverty reduction and alleviation, finance and people-to-people exchanges, he said. 

Senior officials from South Asian countries Afghanistan, Bangladesh, India, Maldives, Nepal, Pakistan, Sri Lanka and Southeast Asian countries like Myanmar and Vietnam attended the two-day CSACF meeting held on the Yunnan’s Fuxian Lake side. The parties agreed that the CSACF would be held annually for policy dialogue, he said.

Li said that the parties also agreed to create a CSACF Secretariat in Yunnan to better serve the development of the forum.

“The forum is a new platform for serving the high-level policy dialogues between the government of China and South Asian countries,” said Li.

He explained that China had many forums and each served a specific region and priorities. For example, China has a mechanism for facilitating closer cooperation with African countries and the European Union.

All mechanisms are built upon the BRI, as China has committed to opening up for trade and investment, he said.

Businesses from 80 countries are participating at the expo event at Dianchi International Convention and Exhibition Centre in Kunming, which ends on June 20.

Pichaya Siewkornburee, the owner of By Heart Cosmetics brand from Thailand, said she had received good feedback from Chinese consumers for her cosmetics herbal products. She is among 147 Thai businesses that showed and sold their products at the event.

In a related development, Yunnan authorities on Thursday announced the setting up of an international commercial arbitration service centre in Kunming, the capital of Yunnan, for dispute settlement purposes which aims to smoothly facilitate trade and investment with other countries.

Source: http://www.nationmultimedia.com/detail/Economy/30347952