- by cnn
- 01 Oct 2023
US Treasury Secretary Janet Yellen is set to ask Congress to lend more money to developing countries to counter China's growing influence, according to a copy of her prepared remarks viewed by CNN.
In addition to increasing lending to other International Monetary Fund programs, Yellen intends to tell lawmakers that the Biden Administration wants to boost involvement in the Inter-American Development Bank group's private-sector investment fund and the African Development Fund.
"These investments will bolster our engagement in these regions at a time of geopolitical competition," Yellen intends to say in her testimony before the House Financial Services Committee on Tuesday. Lending to organizations like the IMF "serves as an important counterweight to nontransparent, unsustainable lending from others like China."
Between 2008 and 2021, China spent $240 billion bailing out 22 countries that are "almost exclusively" debtors in Xi Jinping's signature Belt and Road infrastructure project, including Argentina, Pakistan, Kenya and Turkey, according to a recent study.
But many of the countries it has lent to are struggling to repay the loans, which could put their citizens in deeper levels of poverty. China has called upon the World Bank and IMF to help bail out some of the countries, but it hasn't been transparent about the terms of the loans and other crucial details.
Yellen testified earlier this year that she is "very, very concerned about some of the activities that China engages in globally - engaging in countries in ways that leave them trapped in debt and don't promote economic development."
"We are working very hard to counter that influence in all of the international institutions that we participate in," she said at the time.
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