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Debt trap diplomacy

debt trap diplomacy

Elaboration

This claim suggests that extending credit to another country that is unlikely to be able to repay, thus creating an obligation for the recipient country to favor the country giving credit in geopolitical issues. China is often accused of “debt-trap diplomacy” – strategically ensnaring recipient countries with loans they can`t repay. This is said to increase Chinese leverage, and when recipients default, China can seize strategic assets. Although China`s “debt-trap diplomacy” is a myth that has been thoroughly debunked, world figures continue to use the phrase as a pejorative.

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