Prime Minister Gaston Browne has defended Antigua and Barbuda’s relationship with China, saying access to affordable development financing drives the partnership rather than involvement in geopolitical rivalry with the United States.

Speaking on the Browne and Browne Show on Saturday, Browne said small island states faced expensive borrowing costs and short repayment periods that limited their ability to finance development.

He said the government had explained to Washington that its relationship with Beijing served the country’s economic needs.

“We’re not involved in any geopolitics between China and the United States,” Browne said. “Our only interest is that we want to see them cooperate as the two largest economies in the world.”

Browne contrasted loans carrying interest rates of approximately 10% or 11% with concessional financing he said China offered over 20 years at about 2%.

He said the longer repayment periods and lower interest rates were important for countries that could not readily obtain comparable terms elsewhere.

“All we’re trying to do here is to leverage our foreign policy to get cheap money,” he said.

Browne also identified Saudi Arabia as a more recent source of concessional financing, citing support for the University of the West Indies on similar terms.

The prime minister argued that Antigua and Barbuda’s relatively high income per person restricted its access to some cheaper financing, despite its vulnerability as a small island developing state.

He said wealthy countries could borrow at lower rates and refinance their debts, while smaller states were often required to repay principal within five to seven years.

“What we need are long-term instruments over 20 years, probably about 2% money,” he said.

Browne also criticized the cost of private-sector financing available through international development institutions. He said he raised the issue with World Bank President Ajay Banga during his visit to Antigua and Barbuda.

“How do you expect a company borrowing at 10%, 11% to make a profit?” Browne said, recounting their discussion.

He argued that such costs made it harder for businesses in small island states to operate successfully and urged development institutions to provide more affordable financing with longer repayment periods.

Browne presented the issue as part of Antigua and Barbuda’s longstanding advocacy for reform of the international financial system.

He maintained that cooperation with China should be viewed in that development context and said the relationship posed no threat to the United States.

This article was originally published by Antigua News Room. Read the original article here: Antigua and Barbuda defends China ties as source of cheaper development loans.