Montenegro, the latest victim of predatory Chinese economic policies; China to acquire Montenegro land in case of loan default

Montenegro/Beijing: – China has tightened its debt noose around the neck of Montenegro, a tiny country in the Balkan part of Europe, with a population of a mere six hundred thousand. This month, Montenegro is required to pay the first instalment of the loan, of USD 1 billion, taken from China for the construction of a highway in the last decade. But it is being said that the Montenegro government does not have the required funds to pay this instalment. Sources indicated that China might take over a certain piece of land from Montenegro against the outstanding amount.

Chinese President Xi Jinping announced the ambitious Belt and Road Initiative in the last decade. Under this scheme, China started building projects on a massive scale in the African, Asian, Latin American and European countries. In 2014, China signed an agreement to build a highway with Montenegro, a country in the Balkan region. The 270 kilometres long road was to be made from the coastal city of Bar to neighbouring Serbia. Chinese Exim Bank had provided funding of USD 1 billion for this project.

The contract for the road was awarded to the Chinese company China Road and Bridge Corporation. But even 10% of the project work has not been completed. Although the work is progressing at a snail’s pace, the first instalment of the loan has become due to the Chinese bank, and it has to be paid before the end of July. The exact amount to be paid is unclear, but it is revealed that the Montenegro government does not have the funds to pay the Chinese bank.

There is a provision in the agreement signed in 2014 that if the Montenegro government cannot repay the loan or the instalment, China can acquire any piece of land it wants in Montenegro. The agreement also says that the final word will be of the Chinese court if any dispute arises in this matter. Therefore, it is being claimed that China has trapped Montenegro under the debt burden for exploiting political and trade benefits rather than building the highway. Montenegro is still not a member of the European Union, and the Union has refused assistance to Montenegro to repay the Chinese debt.

Montenegro becomes the second victim of predatory economic policies being implemented by the Chinese communist regime. A few months ago, it had been reported that China was preparing to take over the Mombasa port in Kenya against the loan provided to Kenya. It had been revealed that China had provided a loan of USD 9 billion to Kenya. Claims have been published that China has made similar attempts even in Cambodia and Sri Lanka.

Last month, analyst Fabian Bossart had claimed in a news report in The Times of Israel that the loans provided by China to various countries are non-transparent and are a part of its predatory economic policies. Bossart pointed out that 60% of the loans provided by China have been given at commercial rates. The analyst also warned that the loans provided by China to various countries are being used to make these countries dependent and fulfil China’s political objectives.