NEWS & ANALYSIS

Beware of Chinese bearing R370bn 'gifts' - Alf Lees

DA MP says he will submit questions as to the precise terms and conditions of the offer

DA to question Ramaphosa's R370 billion Chinese 'gift'

The DA will submit parliamentary questions to the Presidency as well as the Minister of Finance, Nhlanhla Nene, to establish the full details of the terms and conditions that are attached to the “gift” of R 370 billion that President Ramaphosa has apparently “negotiated” with China, the big brother in BRICS.

Recent media reports indicate that the Chinese government has promised this multi-billion rand “gift” to South Africa as some sort of stimulus package.

It would be naive in the extreme to think that this “gift” from the Chinese comes with no strings attached.

The Chinese have a history of getting more than their pound of flesh is worth out of African and other countries that they make funds available to.

This is well illustrated by the debt trap that China lured Sri Lanka into by offering funding for a port development that everyone, including the Chinese, apparently knew would not be viable and that Sri Lanka would not be able to repay. This resulted in Sri Lanka apparently being forced to hand over its Hambantota Port plus 6 070 hectares of land around it to the Chinese when they defaulted on repayments of the loans.

The Chinese now have their foothold on a strategic international commercial and military waterway.

The Chinese modus operandi is clearly to initially offer good terms, knowing that more money will be asked for and then, as more money is requested, the terms and conditions become more and more onerous until the borrowing country finds itself in a debt trap. Once it cannot pay China what is due, the debt-ridden country is forced to give up assets and sovereignty that were included as the terms and conditions got more and more strenuous.

President Cyril Ramaphosa is desperate for the $ 100 billion in foreign investment funding that he promised to South Africa.

Despite his protestations to the contrary, Ramaphosa is highly likely to accept the Chinese terms and conditions that could very quickly result in a debt trap where repayments cannot be met and the Chinese start to take ownership of South Africa like they have done in Sri Lanka.

Statement issued by Alf Lees MP, DA Shadow Deputy Minister of Finance, 16 September 2018