Diplomacy 101: Undiplomatically Speaking
Where Beliefs Clash and Stories Flash
Debt Diplomacy and the Scramble for Influence
The first week of August was defined by rising tensions over global debt and development financing, particularly in the Global South.
China hosted the Third Belt and Road Forum in Chongqing, where it announced $60 billion in fresh infrastructure lending across Africa, South Asia, and Latin America. Critics warned of mounting unsustainable debt, while Beijing emphasized “win-win cooperation” and touted its track record on ports, railways, and telecom projects.
Meanwhile, the IMF approved a $4.2 billion loan package to Egypt, accompanied by sweeping fiscal and subsidy reforms. The deal sparked protests in Cairo, reigniting the debate over austerity-driven conditionality in Western lending models.
India and Brazil launched a new South-South finance initiative under the IBSA framework, signaling middle powers’ intent to shape alternatives to both Chinese and Western debt diplomacy.
In today’s diplomacy, who holds the ledger increasingly decides who holds the leverage.