The Debt Trap Diplomacy A case study of China Debt-trap diplomacy is a type of diplomacy based on debt carried out in the bilateral relations between countries. It involves one creditor country intentionally extending excessive credit to another debtor country with the alleged intention of extracting economic or political concessions from the debtor country when it becomes unable to honour its debt obligations. The conditions of the loans are often not made public and the loaned money is typically used to pay contractors from the creditor country. This is an extension of the well-known strategic foreign policy which openly uses economic aid and investment between countries to curry diplomatic favours. China’s Belt and Road Initiative (BRI) can be said as the leading example of Debt Trap Diplomacy. BRI hopes to invest an estimate of US$ 8 trillion in infrastructure financing to 68 countries in Asia, Europe and Africa most of which are under developed. Critics of Chinese lendin...
