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W. Gyude Moore Profile picture
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31 Mar, 6 tweets, 2 min read
This research is an excellent addition to the body of knowledge around Chinese lending practices, especially as we think through the implications of the pandemic on the fiscal position of indebted low income countries - mainly in Africa. cgdev.org/blog/secretive…
In a lot of ways, it brings systematic evidence to what we knew anecdotally. Questions about the opacity of Chinese lending have been a constant refrain in critiques of China's lending practice. We know now that it is a feature, not a bug.
Borrowing from Chinese policy banks have always meant that the funding was deployed to achieve policy ends - we now know that these objectives are secured through "broadly written cancellation and default clauses".
Chinese apparently indiscriminate lending seemed to indicate a creditor unconcerned with the ability of debtors to repay. We now know that China extensively uses "escrow accounts and other forms of non-asset collateral." That sounds like someone who wants to get paid.
One hopes that the focus on this scrutiny of a studiously opaque creditor who now dominates the bilateral lending market doesn't obscure the other finding of the paper: secrecy of bilateral lending agreements is par for the course, even among "transparent" nations.
It's not as if German, French or UK citizens have easy access to their countries' bilateral loan documents. This paper ought to focus our attention on ensuring that public debt information ought be public. China might be the least transparent, it's definitely not the only.

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More from @gyude_moore

W. Gyude Moore Profile picture
20 Jan
Congratulations to @POTUS. Joining my voice to other Africans at home and in the Diaspora who hope for a better, more substantive engagement. We're rooting for you and hope you can achieve your agenda - both for the American people and for the world. THREAD
In his prepared remarks for his committee hearing @ABlinken promised "engage the world not as it was, but as it is.” WE will hold you to that. US Africa policy should, in intent and practice, seek mutual prosperity between Africa and America. 1/
The world as it is recognizes that Africans have interests that are unique and separate from any Great Power competition. We want partners in fulfilling aspirations for ourselves & our children. Finding fulfillment in our homeland. That our culture, economy, societies can thrive.
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W. Gyude Moore Profile picture
11 Jan
China and African Debt - A short thread
Continuing a 30-year tradition, the Chinese Foreign Minister began his year with a trip to Africa. There is no better indication of the importance China attaches to its relationship with the continent. 1/
Which is why it is so disappointing that very little of note was achieved. Up to now, Africa has suffered more from the economic fallout of the pandemic. Debt servicing and a liquidity crunch has backed us against the wall and one would have expected this to be addressed. /2
China’s role in Africa’s current debt crisis is limited to a few countries – but those few countries have such an outsized role in their sub-regions that any default event there could end up having a domino effect elsewhere in Africa. 3/
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W. Gyude Moore Profile picture
10 Aug 20
Last week, I published a thread on what Africa's position ought to be in the rising tension between China and the West. I attempted to lay out arguments against why Africa would choose the West, as a "partner of choice" over China. This week, I want to focus on China. THREAD
China's partnership pitch to African states is compelling. It presents itself as a brotherly nation with the shared experience of the ills of colonialism, yet has no colonial baggage. It offers to assist in financing and building infrastructure to advance African prosperity. 1/
China also presents an alternative development model backed by the unprecedented achievement of lifting over 800 million out of poverty in four decades. For a continent mired in poverty, and low productivity, the Chinese model can be attractive. 2/
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W. Gyude Moore Profile picture
5 Aug 20
Africa's position in the New "Cold War" - Thread

As deputy chief of staff to President Sirleaf, I once took my team to one of the urban slums to talk about the government's programs. I highlighted our human rights, anti-corruption and road building record. 1/
When I was done, one of the listeners raised his hand to ask a question. He wanted to know if he could "cook these things and feed them to his children." He was unimpressed with my response. Bread and butter issues, meeting people's direct needs can never be substituted. 2/
Which brings me to the coming confrontation - economic first, but increasingly dangerous, between China and the West. Africa will be drawn into this as China will definitely continue to look to Africa's 54-bloc for support and legitimacy for its actions. 3/
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W. Gyude Moore Profile picture
18 Apr 20
A few thoughts on the USG's posture toward @WHO: Between Nov. 2002 & March 2003 UN inspectors conducted more over 900 inspections at more than 500 sites across Iraq and found no chemical or biological weapons. There was no evidence of a nuclear weapons program. 1/
Dissatisfied with Iraq's level of cooperation, however, the US United States abandoned the inspections process and initiated the invasion of Iraq on March 19. The whole Middle East is still paying steep price for this decision. It's important to note what did not happen after. 2/
Not a single member state held @UN or @iaeaorg responsible and threatened to withhold funding because the organization did not "demand" the the US remain in the process or "prevent" the US from invading Iraq. And as any adult knows, this made sense. 3/
Read 10 tweets
W. Gyude Moore Profile picture
22 Dec 18
This is a thread: Having been in the position of policymakers who negotiate such financial agreements, I am sympathetic to policymakers in Africa who have the impossible task of using very limited resources to close gaping deficits in infrastructure and social services. 1/
Borrowing carries the dual risk of closing the fiscal space while debt overhang & servicing crowd out everything else. Then there's the time issue: For governments in the tropics, there are only 6 mos. in the year, since no civil works can be done during the raining season. 2/
The 24 to 36 months it takes to develop projects create still more pressure, especially going into elections. Chinese financing, which doesn't insist on building systems, institutions and processes as conditions precedent to lending, is infinitely more practical. 3/
Read 8 tweets

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