Some people may hope that China and Pakistan scale down the China-Pakistan Economic Corridor (CPEC) amid Pakistan‘s increasing debt problems, but those people are going to be deeply disappointed.
Pakistani Prime Minister Imran Khan‘s visit to China, which is scheduled to run until Wednesday, offers an opportunity for the two countries to upgrade their cooperation involving the economic corridor.
China has never thought about slowing down the CPEC. It seems that Pakistan takes the same view. A senior Pakistani official was quoted by Indian news agency PTI as saying recently that Pakistan “would engage China at the highest level for talks on several big projects in the fields of hydropower, oil refinery and steel mills.”
There has been no slowdown of CPEC projects. China will continue to support the Pakistani side‘s efforts to promote the initiative as it enters a “new phase.”
Some mistakenly think the CPEC stalled for two reasons: First, the project has inflicted a debt burden on Pakistan, and second, the US wants Pakistan to slow the CPEC in exchange for financial support. However, such speculation is unfounded.
Pakistan‘s debt problem wasn‘t caused by CPEC projects. Noor Ahmed, secretary of the Economic Affairs Division of Pakistan, was quoted by the Xinhua News Agency as saying that Chinese loans account for a mere 10 to 11 percent of Pakistan‘s total foreign debt.
Although there has been much controversy about so-called debt-trap diplomacy by China, those most qualified to evaluate the CPEC are the people of Pakistan. Pakistani Minister of Planning, Development and Reform Khusro Bakhtiar said recently the CPEC has great potential to boost Pakistan‘s economy and help reduce poverty in the country. The Pakistani economy is at a critical crossroads as its public debt piles up. It‘s impossible for the country to give up opportunities for economic development brought by the CPEC at this crucial moment.
While the first phase of the CPEC concentrated on infrastructure projects, the second part is expected to focus on setting up special economic zones and establishing mutual connectivity. The second phase of the program has already started and it will help support Pakistan‘s economic reform agenda.
The US has historically been one of Pakistan‘s important partners. It‘s natural that Pakistan is developing its relationship with the US. However, Washington is unable to derail China-Pakistan cooperation on the CPEC. It is unlikely that China and Pakistan will change their support for the project due to outsiders‘ criticism.