US Treasury Demands More Transparency on “New Silk Road”

New Silk Road

WASHINGTON (Dow Jones) – US Treasury Secretary Steven Mnuchin has called on the International Monetary Fund (IMF) and the World Bank to launch a “joint action plan” to better illuminate China’s credit-financed infrastructure projects. “Increasingly, we are seeing cases where low-income countries are over-indebted and permanently unsustainable to sovereign creditors such as China or private creditors,” Mnuchin said in a statement at the IMF’s Spring meeting.

Mnuchin’s call for an action plan to clarify the documentation of rising debt is directly addressed to the Chinese initiative “One Belt, One Road”, also called “New Silk Road”. China will be better connected with 64 other countries in Asia, Europe and Africa via infrastructure projects such as motorways, railways, ports and airports.

China has started projects so fast and on such a scale that international observers are struggling to keep an eye on the amount of credit that is being spent by a variety of Chinese local governments and state-controlled institutions, but in the end they are based on one source: Beijing.
According to a report by the Center for Global Development, Djibouti, Tajikistan, Kyrgyzstan, Laos, the Maldives and Mongolia are among the countries that will soon account for more than half of their foreign debt to China. Chinese President Xi Jinping has made the “New Silk Road” a core piece of his plans to expand Beijing’s influence on the global economy.
IMF fears financial problems

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Takata, injured drivers reach deal to end U.S. bankruptcy and sell viable operations

takata

Takata Corp’s U.S. unit  has reached a settlement with its creditors, lawyers for victims injured by its deadly air bags and automakers that paves the way to end its Chapter 11 bankruptcy and sell its viable operations, according to court papers.

The Japanese company’s air bags can explode with too much force and have been linked to at least 21 deaths and hundreds of injuries, prompting the largest recall in automotive history and forcing Takata and its U.S. unit, TK Holdings Inc, into bankruptcy.

The U.S. unit was gearing up for a court fight starting on Tuesday to get approval for its plan to exit bankruptcy over the opposition of a committee for injured drivers and a separate committee of unsecured creditors.

But those two committees, automakers and Key Safety Systems, which is acquiring the viable business lines of Takata, reached a deal that resolves the biggest objections to the plan, according to court documents sighted  on Saturday.

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