this post was submitted on 12 Jul 2023
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So... No citation, right?
https://time.com/6266658/china-emerges-major-global-lender/#:~:text=China%20typically%20offers%20rescue%20loans,the%20IMF%2C%20the%20study%20said.
First result in Google. You cant even Google so im pretty sure you dont know what the hell you are talking about lol.
Rescue loans are not the type of loans being used to build these railway networks lol. It's pretty funny watching someone not understand the problem they're talking about.
Also, the US fed rate is 5% right now... That means loaning money to the safest and most stable economy in the world pays 5% today. Even in your (misguided) context, 5% is a fucking bargain.
Do you even know how IMF rescue loans work? Did you try Google buddy?
I wont even entertain your dumbass ramble about different countries because we arent talking about that.
Great, so you neither understand project funding nor interest rates. Good to know.
You cant even provide facts. Stop arguing in bad faith. Now go schizo post about US loans.
A rescue loan is not a loan used to build infrastructure. They're used to cover for existing debt, not to take on new debt.
The interest rate of loans is dependent on the international market. A loan with an interest rate of 5% is charity because China could get that exact same return from the US (which is much more stable, etc. etc.)
A 5% interest rate loan isn't predatory in this economic environment. It's a fucking donation. Ever heard of risk-adjusted returns?
[citation needed]
Here's some reading for you:
https://www.imf.org/en/Topics/imf-and-covid19/COVID-Lending-Tracker
https://www.adamsstreetpartners.com/insights/covid19-rescue-finance/#:~:text=Rescue%20Finance%20Overview,credit%20and%20pureplay%20distressed%20credit.
Rescue loans are used to service existing debt. That's literally the entire point.
https://www.investopedia.com/terms/r/riskadjustedreturn.asp
These are BASIC concepts. Come on, man.
https://lemmy.ml/comment/1508218
We were talking about this. I said IMF loans are cheaper than china loans. And you proved me correct so the next best thing was nitpicking my comments? Who cares if a loan directly or indirectly benefits a nation.
Go grab some tea, revisit your nonsense and write a proper reply. Im not going to do the same thing as last time in which you refused to read the article everyone except you was discussing.
African countries aren't taking IMF loans to fund this project lol. That's the misunderstanding I think you have. They would be taking World Bank loans.