Friday, May 12, 2017

China Sucks More Countries into OBOR

China has been roping in a broad range of countries to get their support for its "One Belt, One Road" (OBOR) initiative. This is causing increasing concern to Indian strategic experts.

I can see some potential problems happening down the road, which the Chinese leadership's army of Yes-men groupthink followers may be ignoring due to their rose-colored glasses. The lessons of EU loom large for grand schemers who suffer from self-deception.

By pushing high-interest loans onto OBOR collaborators to finance its development, China is basically imposing a mercantilist vendor-financing model to keep its vassals indentured and on the hook to repay Sugardaddy China. The reality is that the populations of these underdeveloped partner countries will ultimately rebel and force their govts to renegotiate - a la Greece. Then China will be on the hook for monies that the others refuse to repay. OBOR could become a big Ponzi scheme. If only Goldman-Sachs were to get involved, as it did in helping Greece rack up bad debt.

Nextly, while Pakistan may be an asset for China militarily, it's a liability for economic trading purposes. This is because of Pakistan's irredentist obsession with India and Kashmir - which may be consistent with war-mongering ambitions, but is entirely contrary to the needs of trade and economic growth, which require peace to be successful. We can already see China experiencing similar problems with its other irredentist client state North Korea, which cannot refrain from its Pak-like obsession against South Korea. Remember the cautionary tale of the Fox and the Scorpion:

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