Foreign companies slam claim of Chinese 'debt trap'
Published: Apr 26, 2019 01:13 PM
Company representatives at the Second Belt and Road Forum for International Cooperation (BRF) have pushed back against accusations that the Belt and Road Initiative (BRI) creates a "debt trap," calling such a claim unjustified and defending their agreements with Chinese counterparts as "neutral and beneficial."

"Chinese companies have offered terms that are very respectable to Greece even it is an indebted country. The Greek people are very satisfied with the result," Iason Rousopoulos, deputy chief financial officer of ADMIE (Independent Power Transmission Operator), Greece's power grid operator, told the Global Times on Friday. 

In 2017, China State Grid Corporation purchased a minority share of 24 percent in ADMIE for $320 million under a loan contract with Bank of China, marking a landmark deal in Chinese companies' increasing presence in countries and regions involved in the BRI. 

Rousopoulos said the deal sealed at the time has been neutral and beneficial. "Chinese partners did not come and buy in distress prices [at a time when Greece is ridden with debts]. They respect the need for consultations and respect the local community, and they have a minority participation for fair value," he noted. 

"[Such an attitude] is not only [applied to] Greece, but also to Portugal, Italy, and other countries, so I don't see how the accusation of Chinese companies [raising debt risks] is justified," he stressed. 

During the ongoing BRF, ADMIE has also signed a Memorandum of Understanding (MoU) with the Bank of China (BOC) who will provide financial support for future connection projects in Greece, including a submarine cable project from Greece's capital of Athens to its islands, a spokesperson from the BOC told the Global Times on Thursday.

"The BRF provides a fair platform for China to promote good and balanced economic relations with both developing countries like those in Africa and the developed Western world," Rousopoulos commented.

The executive said that Greece, as a beneficiary of the BRI, welcomes more Chinese investment, specifically in further energy cooperation not only limited to renewable energy but also in other fields like storage and electric vehicles, which Chinese firms have a competitive advantage in providing cost-effective prices because of the scale of production.

Renewable energy now accounts for about 80 percent of Greece's energy consumption, according to media reports.  

"Chinese companies [could also help] in installing wind farms in Greece's islands to supply energy to the [Europe] continent," Rousopoulos noted.