Daily US Times: China owed at least $385bn to165 countries for “belt and road initiative” (BRI) projects, with loans systematically underreported to international organizations such as the World Bank.
US-based research lab AidData said this in a study report it has been working on for four years. The debt were kept off the public balance sheets through the use of semi-private and special purpose loans, and were “substantially larger than research institutions, credit rating agencies, or intergovernmental organizations with surveillance responsibilities previously understood”.
The AidData study found that China owed from 42 low-to-middle income countries (LMICs) exceeding 10% of their GDP, including the Maldives, Brunei, Laos, Papua New Guinea, Cambodia and Myanmar.
Laos had significant proportions of its debt to China classed by the research lab as “hidden”, the report revealed. The $5.9 billion China-Laos railway project is funded entirely with unofficial debt equivalent to about a third of its GDP.
The BRI was launched in 2013 as Chinese President Xi Jinping’s signature international investment programme. Hundreds of predominately low-to-middle income countries have signed up for loans from China towards massive infrastructure projects, but Beijing is now facing competition from the G7’s “build back better world” infrastructure initiative.
AidData examined more than 13,000 BRI projects in the report, worth more than $843 billion in 165 countries between 2000 and 2017. The report found China’s overseas lending had dramatically shifted from government-to-government loans during the pre-BRI era, to almost 70% now going to state-owned companies and banks, private institutions, joint ventures and special purpose vehicles (SPVs).
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