Need To Know: May 10
How China Undermines Democracy
China’s influence has increasingly eroded democratic institutions in at least 20 countries throughout Central Europe and Central Asia, weakening oversight and bolstering authoritarian leaders.
Washington-based Freedom House came to that conclusion in its Nations in Transit 2020, an annual report on democratic governance in 29 countries spanning Central Europe, the Balkans, and Eurasia.
The report discusses how China’s diplomatic corps, “tailors its approach to each individual country,” exploiting institutional weaknesses, and “embedding itself into corrupt political and economic structures.”
“The aggregate impact of these measures is the further degradation of good governance, transparency, and the rule of law, and the creation of additional avenues for predatory, local political elites to remain in power and further bend the system to their advantage,” it said.
The report says China has captured influence in the region with “debt diplomacy.”
China doesn’t give aid. It makes long-term loans that must be repaid. Beijing extends excessive credit to debtor countries for dubious projects to extract political concessions from the debtor country when it becomes unable to pay. But unlike the E.U., which requires rights reports and transparency, Chinese loans start with no strings attached.
As a result, foreign-held debt in the region is increasingly found in the hands of the Chinese government.
Freedom House noted that Tajikistan, Montenegro, and North Macedonia owe 41, 39, and 20 percent of their debt, respectively, to China. In April 2020, Kyrgyzstan—which owes as much as two-fifths of its foreign debt to China’s Eximbank—was forced to ask for debt relief amidst fallout from the Covid-19 pandemic, which was generated in China.
“Elites” in Cambodia and Thailand have already cozied up to Beijing and diminished democracy at the expense of their people to line their own pockets. The Soviet Union didn’t offer to make local elites billionaires. The People’s Republic of China does. That’s what makes it very dangerous.
Weekly Cost Of Covid-19 Shutdowns
Australia estimates that for every extra week Covid-19 restrictions remain in place, close to $4 billion (US$2.5 billion) will be lost in economic activity, from a combination of reduced workforce participation, reduced productivity, and reduced consumption.
Australia has enjoyed success in curbing the spread of virus, with new daily cases slowing to single digits or zero across most regions; but, the measures have dealt a heavy blow to the economy, with GDP forecast to fall 10% in the second quarter.
The estimate came as the Australian Bureau of Statistics (ABS) reported a 7.5 percent drop in jobs during the crisis – affecting 700,000 workers out of a workforce of 13 million. A third of workers in hotel and hospitality industries lost their jobs, along with 27 percent of people in the arts and recreation sectors. The Treasury has previously estimated the unemployment rate will double to 10 percent, leaving about 1.4 million people out of work.
The ABS also reported that 31 percent of households nationwide had seen their finances worsen.
The Reserve Bank of Australia (RBA) has already cut interest rates to a record low 0.50 percent.
Australian Treasurer Josh Frydenberg said the figures showed Australia "must get people back at work" but the country had only met 11 of the 15 health conditions for lifting restrictions – though work was ongoing to fast-track the remaining four.
Cambodia Uses Covid-19 As Cover For Crackdown
Human rights groups say Cambodian leader Hun Sen is using Covid-19 to tighten his grip on power by carrying out arbitrary arrests of opposition supporters and government critics.
Since January, at least 30 people have been detained for spreading “fake news” and other petty offenses. That includes a dozen people with ties to the opposition Cambodia National Rescue Party (CNRP), which was banned by the Supreme Court in November 2017 for its role in an alleged plot to topple the government. (Heavy emphasis on the word alleged.)
The arrested also include a journalist quoting a speech by Hun Sen, and ordinary Cambodians who criticized the government’s response to the outbreak.
While the number of Covid-19 cases has held steady at 122 with no deaths for more than two weeks, Cambodia’s one-party parliament recently approved legislation authorizing a state of emergency that observers warned could be used to unnecessarily increase already heavy restrictions on freedoms of expression, association and peaceful assembly.