Australia's reaction to concerns about China's loan to Pacific | Pacific Beat

Australia's reaction to concerns about China's loan to Pacific

Australia's reaction to concerns about China's loan to Pacific

Updated 15 February 2012, 12:38 AEDT

As you would have heard on Pacific Beat this week, a new report from the Sydney-based Lowy Institute says China is becoming the new banker to the Pacific Islands.

China is one of the biggest aid donors in the Pacific, pledging 600 million US dollars in loans between 2005 and 2009.

And the Lowy authors found that China has been shifting from grant aid to soft loans and that those loans are leading to increasing problems of indebtedness.

There are also fears the loans could make make Pacific governments more vulnerable to political pressure from Beijing.

We put to Richard Marles, Australia's Parliamentary Secretary for Pacific Island Affairs whether Australia should be concerned about China's increasing loans to the Pacific.

Presenter: Bruce Hill

Speaker: Richard Marles, Australia's Parliamentary Secretary for Pacific Island Affairs

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