China the world's biggest debt collector, report shows

Tuesday, 7 November 2023 (16:11 IST)
China is owed over $1 trillion (€935 billion) through its Belt and Road Initiative (BRI), making it the world's biggest debt collector, a report has said. 
The report, published on Monday by researchers at AidData, showed the world's biggest bilateral lender switching from infrastructure to rescue lending, with an estimated 80% of the loans supporting countries in financial distress.
"Beijing is navigating an unfamiliar and uncomfortable role — as the world's largest official debt collector," AidData said in its report. 
"Total outstanding debt — including principal but excluding interest — from borrowers in the developing world to China is at least $1.1 trillion," said the research institute that tracks development finance at Virginia's College of William and Mary.
According to China, more than 150 countries have signed up to the BRI, a mammoth global infrastructure thrust launched by President Xi Jinping in 2013. 
Based on data collected  on Chinese financing of almost 21,000 projects in some 165 countries, AidData said Beijing had now committed aid and credit "hovering around $80 billion a year" to low and middle-income nations.
Overseas finance has won the Asian giant allies from across the developing world.
At the same time, there has been criticism from the West and in some recipient nations, like Sri Lanka and Zambia, that infrastructure projects China-funded burdened them with debt they were unable to repay.
Last month, at a summit that marked a decade since the initiative was first unveiled, Xi said that China would put more than $100 billion of new funds into the BRI.
However, a joint report by the World Bank and other institutions, including AidData, released this year said China had been forced to give out billions of dollars in bailout loans to BRI countries in recent years.

Read on Webdunia

Related Article