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Kazakhstan Protests

Kazakhstan’s Economy Feeling the Pakistan-Sri Lanka like Crisis

 

Ugly side of Debt Trap of China

In 2019, Protests broke out in the oil-producing city of Zhanaozen in southwest Kazakhstan in early September, over purported plans to move 55 factories from China to Kazakhstan.

Protesters complained that Chinese immigrants were taking all the jobs, that Chinese enterprises were polluting the environment and buying up land, that the Chinese authorities were persecuting Kazakhs in Xinjiang.

In early 2021, protests were held in Almaty, and in the capital Nur-Sultan, as well as Oral, Shymkent, and Aqtobe against China.

What Kazakhstan authorities couldn’t fathom, was the steady decline of their economy, and mounting debts they owe to China.

Fast forward to this week, That has all culminated in the wildfire that hit the town of Zhanaozen. On Sunday, demonstrators took to the streets after a sudden doubling in the price of liquefied petroleum gas, a fuel used by the majority of motorists in the western region of Mangystau.

Over the past three years, under pressure to pay up the Chinese loans, Kazakhstan has been removing subsidies on LPG and setting the price at market rates.

Silk Road or A Road of Thorns?

When will the Development and Profits Arrive?

On the Kazakh China border, a museum of cranes, railways, and buildings rises out of a barren stretch of desert surrounded by towering mountains. The Chinese promise of the glitter: Khorgos Gateway with the flashy nomenclature “dry port” maintains a desolate wry look, seven years after Xi Jinping sold that dream to Kazakhs.

Here Chinese freights were to be reloaded onto Kazakh trains to make the 5,000-plus-mile journey to Europe; across Eurasia. Beyond the logistics hub, Xi Jinping also sold the dream of a special economic zone to attract investors to build factories and warehouses, and a free-trade border zone that aims to increase commerce with China.

On the Kazakh side of the border, Nurkent houses the area’s workers, with ambitious plans to grow it in the coming decades to complement its sister city in China, also called Khorgos, which already features shopping malls, hotels, and a population of more than 100,000.

All is now barren and empty, giving Nil revenues and in turn putting the inexplicable burden on the Kazakhstan government, to pay back to China.

There are No Profits in BRI/CPEC

There will never be!

There are no takers of the Rail/Road link between China and Europe.

Rail transport is still only a meagre percentage of global trade; sea and air routes, which are cheaper and faster, respectively, form the bulk of goods moved between China and Europe.

Nargis Kassenova, a Central Asia expert at Harvard who focuses on China’s role in the region, is sure on  Khorgos not delivering as advertised. “Khorgos is not a game-changer and might never become one, it is uneconomical”.

Hilariously, the Communist party has been haranguing the Rail officials to keep the empty trains moving. Many of the cargo containers returning by rail from Europe to China through Kazakhstan are empty, due to a trade imbalance.

The Chinese government is promising significant subsidies to encourage the use of rail links, and a recent report by the Chinese Business Journal found that many exporters transported empty containers from China to Europe just to receive those subsidies.

Just like the Galwan Photo Operations and poster campaign, China’s Communist CCP (China Communist Party) believes in the showmanship of the highest pedigree. Except it’s all hollow and false, just to sell more of its shady deals with governments.

Viewpoint

Since BRI was launched, in 2013, China has sunk hundreds of billions of dollars into irrelevant ports, railways, and energy projects across Asia, Africa, and Europe.

None of them are free.

All of them have a high rate of interest.

Coming with undisclosed terms, they have been eating away at those susceptible country’s Forex reserves (like Pakistan and Sri Lanka) and sucking the economies dry.

Citizens in these countries feel the stress Chinese Debts creates directly in their pockets.

$62 billion China-Pakistan Economic Corridor has been curtailed amid Pakistan’s increasing debt problems.

Using India’s support, a major port deal in Myanmar was slimmed down from roughly $7 billion to $1.3 billion.

The new Malaysian government renegotiated a major rail project at a significantly reduced cost and cancelled $3 billion worth of plans to build new pipelines following a graft scandal.

The Maldives is seeking debt forgiveness following corruption allegations connected to Belt and Road projects green-lit by its previous government, and Chine is pouring in millions to tarnish this government along with it paid “Go Back India” campaign, using Pakistan Army’s ISI network of Radicals.

Russia had to extend a helping hand to Kazakhastan, and in the future, we shall see Russia inviting India to be on board to get the Stans( Kazakhstan, Uzbekistan, Turkmenistan) out of this mess, the way India is standing by the Sri Lankans.

Russia doesn’t see China’s dirty play in its backyard with welcome eyes.

However, questions regarding the commercial value of all projects and concerns over the initiative being a backdoor for more sinister geopolitical ambitions have now come out in the open for all to see.

Beijing’s official rhetoric of “win-win” cooperation has been proved to be a blatant lie and Kazakhstan’s economic slide after Sri Lanka and Pakistan has illustrated the uncertainty surrounding China’s intentions with BRI.

07 Jan 22/Friday                                                                         Written By: Fayaz

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