China's debt trap diplomacy on developing countries: the case study of Angola
Date
2023
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Publisher
Tartu Ülikool
Abstract
China has been focusing on advancing its foreign policy toward developing countries through aid, loans, and investments since 2008. However, concerns have been raised about the amount and rate of these loans and the potential risks for debtor countries, as seen in cases like Sri Lanka and Uganda. This study investigates China's debt trap diplomacy on developing countries, with Angola as a case study. The study aims to determine the extent to which China has advanced its foreign policy goals towards Angola and how Angola's decision to borrow has advanced its interest. The study adopts a qualitative research approach, leveraging the liberalism theory. The findings reveal that China has indeed advanced its foreign policy goals toward Angola through its lending foreign policy which accounts for 75.9% of Angola's gross domestic product on average from 1995 to 2021. This development implies that Angola will show more loyalty to China's government and its counsel than any other international country lender. Moreover, Angola's borrowing decision has advanced its interest, as evidenced by the series of executed developmental projects, leading to rapid economic, social, and technological development. Despite increasing debt, this progress indicates a clear indication of progress, particularly after enduring years of the Cold War. Contrary to popular belief, the study concludes that China-Angola debt diplomacy is a win-win foreign policy relationship, benefiting both countries. Therefore, countries seeking financial aid from foreign sources should be cautious of the source of funds and the terms of return to prevent becoming trapped in debt unnecessarily. It is crucial for nations to consider all available possibilities when looking for financial assistance to maximize the likelihood of a successful conclusion for all parties involved.