CMB's first time! Pakistan has officially declared
“A country’s wallet is empty, what to do?”
Pakistan’s answer is straightforward, looking for China and sending out panda debt.
When a country’s wallet is empty, will someone really lend it money? and without asking for interest, without setting a threshold, no matter if you have food or electricity?
On September 12, the Pakistani government officially announced that it would issue $25 billion in panda debt to China.
First, let's talk about how difficult it is in Pakistan at this time. We ordinary people can find relatives to turn around when we have no money at home. It's a big deal that the country has no money.
Pakistan now has $14 billion in foreign exchange reserves, $131 billion in foreign debt, and $22 billion to expire at the end of this year, which is like a home owed a ass debt, at the end of the month, a large amount will be paid, and the money in the hand is not enough to buy food.
There are power outages in the streets all the year round, and there is a shortage of medical care and medicine in hospitals. 44% of people are below the poverty line, and one in 20 people has no job. This life is really at a critical juncture.
Their economy has long been unbearable, exports rely on the sale of fabrics and agricultural products, can not earn a few money, but the annual purchase of oil and natural gas has to spend $14.2 billion, 70% of foreign currency are crushed on this, power generation can not recover the cost, more and more indebted, forming a vicious cycle.
They first looked for money from the International Monetary Fund, that is, the IMF, but the money there was not good at all.
To borrow money, you have to promise people's conditions: cutting people's subsidies, raising tax rates, and also cutting public servants, these things, the people are harder, the government is difficult to be people, and no one wants to be affected by this, Pakistan naturally turned its eyes to China.
Someone may want to ask, what is the panda debt in fact? to say it is that Pakistan borrowed the yuan in China, the expiration of the current interest rate to repay the yuan, the same as us ordinary people seek bank loans in essence, but the scale is countless times larger.
The $2.5 billion panda debt to be issued by Pakistan, approximately RMB 1.8 billion, 3 years of expiration, interest rate is approximately 3% to 4% per year, not that there is really no interest, but only compared to those high-interest loans internationally, this interest rate has been low conscience.
And this money can not be spent at will, clearly said to go to hospitals, power plants, water projects these most urgent places, each penny must be spent on people's livelihoods, which is borrowed money, clearly to friends gave the rope of life, also helped to plan how to use this rope to climb up.
No, Pakistan's credit rating has not yet reached the investment level, it's a bit difficult to issue debt according to the regulations, so they have to look for the AIIB or the Asian Development Bank to make a guarantee, this is the threshold, but China has not added a bunch of political conditions like the West.
We always do things really, not forcing people to change this change that, only look at whether you really need it urgently, will not spend the money in the right place, this way than the kind of "fires robbed" too much, people are fast without food, where is the energy to deal with those additional requirements?
China's willingness to help this favor is by no means a whim, but the confidence accumulated by decades of friendship. In the past, we helped Pakistan build roads and bridges, and built Thar Coal Power Station and Sahiwal Power Station. These two projects can meet the needs of 20 million people. People's electricity demand has reduced their dependence on imported energy from 72% to 58%, saving US $3.5 billion in foreign exchange every year.
Following the construction of the port of Guadalupe, the routes to the Middle East were shortened by 40 percent, and the cost was reduced by 18 percent, all of which are real benefits.
Pakistan also knows how to thank, before the prime minister came to China, intentionally put 100 billion rubles in advance into the Chinese account, this mutual trust, not a day or two can save out.
More importantly, this is good for both countries, not to pay unilaterally, for Pakistan, to get this yuan, do not have to work hard to exchange for dollars to buy things, can directly use the yuan from China or other countries that accept the yuan to buy food and energy equipment, just solved the problem of not enough foreign currency.
And this money invested in people's livelihoods projects, can let the factories start work, let hospitals operate, people have work and food to eat, the country can slowly "create blood", in the future earn the RMB to repay the debt, form a good cycle, if the money is broken on the old debt, that is really no hope.
For China, this is also an important step towards the world, now the panda bond market has almost 300 billion in scale, the cumulative issuance has broken 1 trillion, Hungary, Egypt and Mercedes, BMW and other large companies have issued debts.
Pakistan joined, showing that more and more countries recognize the value of the RMB, are willing to trade with the RMB, and so on, more countries will use the RMB to make debts and do business, we will not need to look at the face of the dollar, which is a long-term good thing.
Of course, we must also say the truth, $2.5 billion can not save the roots, only to solve the hurry, Pakistan to really turn, also have to rely on their own economic structure, can not always rely on the sale of primary products to spend the day, must solve the energy problem thoroughly, so that the factory can stabilize production, in order to truly earn money.
But backwards, if even the difficulties ahead are not overcome, what is the long-term development?The Chinese gang has given them a chance to breathe, so that they can have energy to solve the fundamental problems.
Now internationally, there are people who say that China borrowed money is a "trap", but if you look at the situation in Pakistan, you will know that we have never forced people to do what they do not want to do, but instead help build power plants and repair ports, and actually improve people's livelihoods.
This time the panda debt is even clearer, where the money is spent, how to repay, how much interest, all put on the table, than those with aid flagship to interfere with other domestic affairs more clean.
In the final analysis, the exchanges between countries are the same as those between people. Sincerity exchanges sincerity. When Pakistan thinks of China in the most difficult time, China is willing to reach out and give a hand. This is either a so-called "strategic calculation" or a reliable friend. What should be done.
Behind this panda debt, a country's desire for livelihood, the mutual trust of two countries, is a different form of international cooperation - no high presence, no additional conditions, this way of helping, more than any gorgeous slogan.
“A country’s wallet is empty, what to do?”
Pakistan’s answer is straightforward, looking for China and sending out panda debt.
When a country’s wallet is empty, will someone really lend it money? and without asking for interest, without setting a threshold, no matter if you have food or electricity?
On September 12, the Pakistani government officially announced that it would issue $25 billion in panda debt to China.
First, let's talk about how difficult it is in Pakistan at this time. We ordinary people can find relatives to turn around when we have no money at home. It's a big deal that the country has no money.
Pakistan now has $14 billion in foreign exchange reserves, $131 billion in foreign debt, and $22 billion to expire at the end of this year, which is like a home owed a ass debt, at the end of the month, a large amount will be paid, and the money in the hand is not enough to buy food.
There are power outages in the streets all the year round, and there is a shortage of medical care and medicine in hospitals. 44% of people are below the poverty line, and one in 20 people has no job. This life is really at a critical juncture.
Their economy has long been unbearable, exports rely on the sale of fabrics and agricultural products, can not earn a few money, but the annual purchase of oil and natural gas has to spend $14.2 billion, 70% of foreign currency are crushed on this, power generation can not recover the cost, more and more indebted, forming a vicious cycle.
They first looked for money from the International Monetary Fund, that is, the IMF, but the money there was not good at all.
To borrow money, you have to promise people's conditions: cutting people's subsidies, raising tax rates, and also cutting public servants, these things, the people are harder, the government is difficult to be people, and no one wants to be affected by this, Pakistan naturally turned its eyes to China.
Someone may want to ask, what is the panda debt in fact? to say it is that Pakistan borrowed the yuan in China, the expiration of the current interest rate to repay the yuan, the same as us ordinary people seek bank loans in essence, but the scale is countless times larger.
The $2.5 billion panda debt to be issued by Pakistan, approximately RMB 1.8 billion, 3 years of expiration, interest rate is approximately 3% to 4% per year, not that there is really no interest, but only compared to those high-interest loans internationally, this interest rate has been low conscience.
And this money can not be spent at will, clearly said to go to hospitals, power plants, water projects these most urgent places, each penny must be spent on people's livelihoods, which is borrowed money, clearly to friends gave the rope of life, also helped to plan how to use this rope to climb up.
No, Pakistan's credit rating has not yet reached the investment level, it's a bit difficult to issue debt according to the regulations, so they have to look for the AIIB or the Asian Development Bank to make a guarantee, this is the threshold, but China has not added a bunch of political conditions like the West.
We always do things really, not forcing people to change this change that, only look at whether you really need it urgently, will not spend the money in the right place, this way than the kind of "fires robbed" too much, people are fast without food, where is the energy to deal with those additional requirements?
China's willingness to help this favor is by no means a whim, but the confidence accumulated by decades of friendship. In the past, we helped Pakistan build roads and bridges, and built Thar Coal Power Station and Sahiwal Power Station. These two projects can meet the needs of 20 million people. People's electricity demand has reduced their dependence on imported energy from 72% to 58%, saving US $3.5 billion in foreign exchange every year.
Following the construction of the port of Guadalupe, the routes to the Middle East were shortened by 40 percent, and the cost was reduced by 18 percent, all of which are real benefits.
Pakistan also knows how to thank, before the prime minister came to China, intentionally put 100 billion rubles in advance into the Chinese account, this mutual trust, not a day or two can save out.
More importantly, this is good for both countries, not to pay unilaterally, for Pakistan, to get this yuan, do not have to work hard to exchange for dollars to buy things, can directly use the yuan from China or other countries that accept the yuan to buy food and energy equipment, just solved the problem of not enough foreign currency.
And this money invested in people's livelihoods projects, can let the factories start work, let hospitals operate, people have work and food to eat, the country can slowly "create blood", in the future earn the RMB to repay the debt, form a good cycle, if the money is broken on the old debt, that is really no hope.
For China, this is also an important step towards the world, now the panda bond market has almost 300 billion in scale, the cumulative issuance has broken 1 trillion, Hungary, Egypt and Mercedes, BMW and other large companies have issued debts.
Pakistan joined, showing that more and more countries recognize the value of the RMB, are willing to trade with the RMB, and so on, more countries will use the RMB to make debts and do business, we will not need to look at the face of the dollar, which is a long-term good thing.
Of course, we must also say the truth, $2.5 billion can not save the roots, only to solve the hurry, Pakistan to really turn, also have to rely on their own economic structure, can not always rely on the sale of primary products to spend the day, must solve the energy problem thoroughly, so that the factory can stabilize production, in order to truly earn money.
But backwards, if even the difficulties ahead are not overcome, what is the long-term development?The Chinese gang has given them a chance to breathe, so that they can have energy to solve the fundamental problems.
Now internationally, there are people who say that China borrowed money is a "trap", but if you look at the situation in Pakistan, you will know that we have never forced people to do what they do not want to do, but instead help build power plants and repair ports, and actually improve people's livelihoods.
This time the panda debt is even clearer, where the money is spent, how to repay, how much interest, all put on the table, than those with aid flagship to interfere with other domestic affairs more clean.
In the final analysis, the exchanges between countries are the same as those between people. Sincerity exchanges sincerity. When Pakistan thinks of China in the most difficult time, China is willing to reach out and give a hand. This is either a so-called "strategic calculation" or a reliable friend. What should be done.
Behind this panda debt, a country's desire for livelihood, the mutual trust of two countries, is a different form of international cooperation - no high presence, no additional conditions, this way of helping, more than any gorgeous slogan.