The Finance Minister, Asad Umar stated that Pakistan has a debt problem for sure; however, it does not have a China debt issue any more.
Talking to the China Global Television Network (CGTN), at the China International Import Exhibition (CIIE), his comments arose in reply to allegations that China was using debt tactic to increase its impact globally.
Umar has said that the China-Pakistan Economic Corridor (CPEC) was an outstanding specimen of collaboration in between two countries which was advantageous for them both. Replying to the notion of CPEC being a suspicious move by China to lead monetary problems to Pakistan, he said it was “absolute nonsense”.
He made a remark in response to statements that China was using “debt diplomacy” to expand its influence worldwide.
Under CPEC, a trial scheme of the Belt and Road Initiative (BRI), the Pakistan was given Chinese loans to construct billion dollar groundwork projects, from railways to roads. Furthermore, Umar stated that China’s debt was not more than 10% of the total, which was surely not a huge number.
He said the proportion of debt-to-GDP of the country was high but still controllable. “The reason why debt sustainability is a problem in Pakistan is that we don’t have enough exports; we are not generating enough foreign currency inflows to be able to service the debt, and that’s the fundamental problem,”