MANILA, Philippines — Malaysia Prime Minister Mahathir Mohamad on Thursday cautioned the Philippines to carefully deal with loans from China, drawing from his country’s experience after his government scrapped what he calls “unfair” Chinese-backed infrastructure projects. In an interview with ANC Television, Mahathir, who is in Manila for a two-day visit, said the Philippines should avoid repeating the mistakes made by other countries that suffered from unsustainable debt by accepting Chinese infrastructure investments. “This is something that of course China has been accused of, but it is also the country’s concern which can regulate or limit all these influences from China,” Mahathir said. Last year, London-based think tank Capital Economics said given the "corruption problems" associated with Chinese infrastructure projects and the Philippines’ current account gap "already approaching unsustainable levels,” Chinese investment “could make problems worse” for the Southeast Asian nation. “The upshot is that while improvements to the country’s infrastructure are desperately needed, the pace of increase needs to be managed properly in order to avoid further balance of payments strains,” Capital Economics said.

Source: Philippine Star March 07, 2019 06:22 UTC