All countries must pay their share — especially when it comes to debts. Yet, China seems to believe it is exempt from this rule.
According to The Hill, the U.S. currently owes China $850 billion and is making interest payments on this hefty sum.
However, China is currently in debt to bond holders in the United States and has now defaulted on its debt. But that hasn’t stopped China from continuing trade with the U.S. in a business-as-usual fashion.
The question now is: Will President Biden demand the Chinese to pay?
Past U.S. administrations have ignored China’s debts, allowing trade and business to continue with no consequences. But times have changed, and as the Hill noted, “the [U.S.] relationship with China has soured, and the People’s Republic of China has become the greatest adversarial threat to the U.S. and Western security.”
Today, we know China to be one of the biggest economies in the world. The Chinese market is so vast that American companies such as
As the Hill reported, China’s economic power is strong because before 1949, the Chinese government issued a large set of long-term sovereign gold bonds that were secured by Chinese investors in order to build infrastructure and finance governmental activities.
In 1938, during the Second Sino-Japanese war, China was essentially divided into three factions — Nationalist China under government control, Communist China, and other Japanese-occupied areas.
The Nationalists eventually defeated by the communists, making the People’s Republic of China the country’s official government.
Under international law, the “successor government,” currently the Chinese Communist Party, must pay for the defaulted bonds.