Sri Lanka’s economic crisis continues to run out of control and the country is requesting an emergency bailout from the International Monetary Fund. However, the major debts the country has racked up in borrowing from China are standing in the way of a bailout being agreed.
Chinese money has flooded into many developing countries over the past few years but some claim that these loans are designed as ‘debt traps’. It’s claimed that if a country can’t repay then China is entitled to seize critical infrastructure such as ports and thereby strengthen it’s global influence.
Others suggest that China is not in fact exploiting developing nations but their investment may facilitate more local level corruption.
Newsnight’s economics editor Ben Chu went to Sri Lanka to investigate the impact of Chinese money and what implications this may have for the global cost of living crisis.
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