West sowing discord between islands & China: analysts

Loan problems among Pacific island countries are a political issue induced by Western countries for their own interests, Chinese analysts said on Tuesday after Tonga pressured Beijing to write off debts for countries in the region.

Tongan Prime Minister Akilisi Pohiva has urged Pacific island nations to use the upcoming Pacific Islands Forum in Nauru to lobby China to write off their debts, ABC Radio Australia reported.

Pacific Islands Forum Chairman and Samoan Prime Minister Tuilaepa Sailele Malielegaoi objected, saying it was embarrassing for Pacific island nations to want their loans written off, Radio New Zealand reported.

Yu Lei, a research fellow at the Australian Studies Center of Beijing Foreign Studies University, told the Global Times on Tuesday that South Pacific nations were “bewitched” by Western countries including Australia and the US, who sought to gain political leverage in the region.

By inciting South Pacific nations to come up with the idea of writing off loans, Western countries were trying to sow discord between China and South Pacific nations, Yu said.

Tonga’s complaints center on $160 million borrowed from China’s Export-Import Bank, the ABC report said. But Yu said countries in the region own a relatively low debt ratio compared to Western loans and the loan offered by China has low interest rates and flexible repayments.

Unlike Western aid, which always comes with political and economic conditions, Chinese aid has been widely welcomed by South Pacific nations as it has no political conditions, Yu noted.

“China will continue to do its best to support and assist Tonga and other Pacific island countries in their pursuit of sustainable development,” Chinese foreign ministry spokesperson Lu Kang said on Monday.

Tonga and China will properly resolve the issue through friendly consultations, Lu said.

Concessional loans cannot be written off based on China’s rules on foreign aid and international rules, Song Wei, an associate research fellow at the Chinese Academy of International Trade and Economic Cooperation in Beijing, told the Global Times.

Reducing or canceling loans applies to interest-free loans given to the most underdeveloped nations, Song said, not to concessional loans issued by China’s Export-Import Bank.